Hey...what about Volume? | Page 33 | Forex Factory

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Hey...what about Volume?

  • #641
  • Oct 6, 2019 7:31pm Oct 6, 2019 7:31pm
Quoting DonPato
{quote} Yes I believe that is the correct one. You need to contact the proprietor and ask him to specifically include the function for Delta volume. It is a toggle switch in the settings. He was very helpful for me and allowed me to demo the indicator before I bought it. The nice thing is that after you buy it any and all further updates are included in the price.
Perhaps I am being slow but I cannot see the Developer’s contact details anywhere. Would you mind PM’ing them over?

If this works well in demo I am happy to purchase.

I have read this thread and hopefully will contribute soon. I found Anna Coulling’s volume analysis book fascinating, it shares some similar principles to this.

I have been using futures charts volume (taken from CME) on tradingview up until now.
  • #642
  • Oct 6, 2019 8:53pm Oct 6, 2019 8:53pm
Quoting Neogenesis
{quote} Perhaps I am being slow but I cannot see the Developer’s contact details anywhere. Would you mind PM’ing them over? If this works well in demo I am happy to purchase. I have read this thread and hopefully will contribute soon. I found Anna Coulling’s volume analysis book fascinating, it shares some similar principles to this. I have been using futures charts volume (taken from CME) on tradingview up until now.
Check the lower right corner of this screenshot...
https://www.forexfactory.com/showthr...2#post12520762
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  • #643
  • Oct 7, 2019 9:31am Oct 7, 2019 9:31am
Hello again friends...its been awhile since I posted here...busy summer for me (away from trading). I am just catching up and wondering if there is any further discussion about this topic. I have tried to answer any questions in my absence but don't see anything regarding order flow/volume...

Anyone have a comment...question...or observation? I am no guru but am more than happy to express my point of view and hopefully we can engage in a productive discussion.
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  • #644
  • Oct 7, 2019 9:47am Oct 7, 2019 9:47am
Hopefully we can get a conversation started with this graphic.
Attached Image (click to enlarge)
Click to Enlarge Name: Screenshot1.png Size: 53 KB

Today's trading (and thus its order flow/volume) has not yet completed but so far it appears an "order flow inversion" is taking place. I will need to revisit this chart again at the end of the day. I am already long with one position but so far me second pending order has not triggered...came close on Friday though. If this inversion holds until the end of the day, we will most likely see a retest of the low seen here...which may trigger my order then when this retest fails, a skyrocket price advance to test at least the top of the previous range.

In any case it appears that buying is trying to assert as the dominant order flow.
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  • #645
  • Oct 7, 2019 5:08pm Oct 7, 2019 5:08pm
Quoting DonPato
Hello again friends...its been awhile since I posted here...busy summer for me (away from trading). I am just catching up and wondering if there is any further discussion about this topic. I have tried to answer any questions in my absence but don't see anything regarding order flow/volume... Anyone have a comment...question...or observation? I am no guru but am more than happy to express my point of view and hopefully we can engage in a productive discussion.
Hi @DonPato hope you had a nice summer & a fantastic break

Thank you for what you have shared thus far, IMO this is one of the best & understated threads here on FF & contains a wealth of great information.

I too trade on cTrader & have been using the volume/delta profile that you use, a great tool! I'm still trying to get a handle on it along with learning the subtleties of volume & order flow, a work in progress but finding it extremely powerful. Don if I may ask please, are you still incorporating your daily analysis technique with climax/absorption/exhaustion? If so, do you then switch to the delta profile for more clarification of a potential order flow shift or are you doing combination of both by having 2 charts up on your screen with a daily + 2hr with delta profile, or are you primarily using the delta profile now?

Also if I may ask a further question please, is there any reason why you decided on the 2hr chart as opposed to 1hr or 4hr for your delta profile use?

Many Thanks,
J
  • #646
  • Oct 7, 2019 7:01pm Oct 7, 2019 7:01pm
Quoting J-j
...Don if I may ask please, are you still incorporating your daily analysis technique with climax/absorption/exhaustion? If so, do you then switch to the delta profile for more clarification of a potential order flow shift or are you doing combination of both by having 2 charts up on your screen with a daily + 2hr with delta profile, or are you primarily using the delta profile now?
Below you can see the price chart and the order flow chart side-by-side and compare the two. I still absolutely use the phases I explained earlier in this thread and now with this tool (volume delta) I can pin point those phases much more clearly.
Attached Image (click to enlarge)
Click to Enlarge Name: Screenshot1.png Size: 100 KB

Note above how the climax and absorption bars are clearly visible. In fact you can actually see the selling that was absorbed in the tails of those lower pin bars. (circled) Also not that the exhaustion bar (when viewed on the price chart) seems clear enough with falling volume while price drops, but underneath that bar in the order flow you can see how mixed the volume was and even though price still continued lower...there was considerable buying mixed in. Finally the bar AFTER this (in the order flow chart) was the type of exhaustion bar I am looking for. Where the majority of the selling occurs late in the day and near the low.

Quoting J-j
...Also if I may ask a further question please, is there any reason why you decided on the 2hr chart as opposed to 1hr or 4hr for your delta profile use? Many Thanks, J
The simple answer to this question is this: I do not evaluate the 2 hr bars at all. I am only interested in the level where the selling and buying occurs. the two hour chart allows alignment with the price chart above it (as best as possible). I do NOT take any action based on any intraday chart or the intraday order flow. I try to allow the day to finish and then look at the order flow of a finished daily candle.

There is one small advantage however...it does allow to determine whether heavier volume was (or is most likely to be) stops being run or profit taking. If you see opposing heavy volume occurring where intraday stops would "naturally" be, then its a safe bet that order flow is STOPS being run. If you seen opposing heavy volume at the end of a bullish or bearish move NOT in the area where stops would likely be...its a safe bet that is profit taking and that any continued move in the same direction is likely to be weak and have no "legs". The intraday charts (2 hr candles) allow you to see the levels where these heavy volumes occur and make more informed conclusions about how the order flow is playing out.
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  • #647
  • Oct 9, 2019 3:14am Oct 9, 2019 3:14am
Hi DonPato,

Thanks so much for your detailed reply & the charts illustrating your explanation, really clarifies a few things mate so very much appreciated

Don those colored candles you use on the daily in cTrader are they coded to be similar to the Better Volume indicator or are they coded for your own representation of normal/climax/absorption/exhaustion?

Cheers,
J
  • #648
  • Oct 9, 2019 7:51am Oct 9, 2019 7:51am
Quoting J-j
Hi DonPato, Thanks so much for your detailed reply & the charts illustrating your explanation, really clarifies a few things mate so very much appreciated ...
You are most welcome and I really hope we can begin a conversation about these concepts to the benefit of both our understandings of the market structure at work.

Quoting J-j
...Don those colored candles you use on the daily in cTrader are they coded to be similar to the Better Volume indicator or are they coded for your own representation of normal/climax/absorption/exhaustion? Cheers, J
you are correct. These are the "Better Volume Indicator" for cTrader. I have been using this indicator for some time (long before I really understood the significance of volume). It is only within the last few years that I have been making some specific observations regarding this subject and found the better volume indicator closely matched (but not exactly) what I was observing in my futures trading (using actual volume). The combination of Better volume and my extrapolated volume delta (that I wrote) helped things a long a bit, but the delta volume histograms has truly exploded my "vision" and allowed a much clearer view of the order flow.

Before you ask...here are the setting I use:
Attached Image (click to enlarge)
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  • #649
  • Oct 10, 2019 5:19pm Oct 10, 2019 5:19pm
Hello again friends...just a follow-up on the most recent trade I posted here: https://www.forexfactory.com/showthr...4#post12544904

In the above post I was watching for buying to become more dominant and today we saw that that indeed did occur.
Attached Image (click to enlarge)
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A buying cascade occurred as shorts stopped out both yesterday and all throughout today. The current position is up 100 pips and I have moved a stop up to a little better than break even. I never did get filled on my second position so it is just this one that is working. I am anticipating that price will rise to challenge the 109 area...but that is still a ways off...so I'll just take it one day at a time...for how we have a working risk free trade.
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  • #650
  • Oct 10, 2019 5:39pm Oct 10, 2019 5:39pm
Quoting DonPato
{quote} You are most welcome and I really hope we can begin a conversation about these concepts to the benefit of both our understandings of the market structure at work.
Thanks once again Don most helpful.
Sounds like a plan mate, will get a little more up to speed & a conversation about these concepts would be great
  • #651
  • Oct 11, 2019 10:47am Oct 11, 2019 10:47am
Hello friends...I just wanted to bring up what I consider a major warning sign for anyone who still has a bearish bias on AUD/USD.
Attached Image (click to enlarge)
Click to Enlarge Name: Screenshot2.png Size: 56 KB

There is some MAJOR selling going on right now at a level that I would anticipate selling to occur. In fact at least 70% of the day's selling is occurring right now as I write this. While I would anticipate that this might happen, what I did NOT anticipate is that price continues to rise even though this selling is going on. Again...in spite of all this selling price's reaction is to continue to rise...

Interpretation. Selling is being absorbed by larger concerns interested in buying. These are not just profit takers closing out weekly positions.

I will revisit this chart again mid week next week to see if this selling (an any further that may occur until then), has any bearish effect on price. Just a heads up (now while it still early). I will be looking to buy dips in the near future and most likely until and through the end of the year.
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  • #652
  • Oct 11, 2019 10:47am Oct 11, 2019 10:47am
Hello friends...I just wanted to bring up what I consider a major warning sign for anyone who still has a bearish bias on AUD/USD.
Attached Image (click to enlarge)
Click to Enlarge Name: Screenshot1.png Size: 56 KB

There is some MAJOR selling going on right now at a level that I would anticipate selling to occur. In fact at least 70% of the day's selling is occurring right now as I write this. While I would anticipate that this might happen, what I did NOT anticipate is that price continues to rise even though this selling is going on. Again...in spite of all this selling price's reaction is to continue to rise...

Interpretation. Selling is being absorbed by larger concerns interested in buying. These are not just profit takers closing out weekly positions.

I will revisit this chart again mid week next week to see if this selling (an any further that may occur until then), has any bearish effect on price. Just a heads up (now while it still early). I will be looking to buy dips in the near future and most likely until and through the end of the year.
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  • #653
  • Oct 11, 2019 8:09pm Oct 11, 2019 8:09pm
Quoting DonPato
{quote} We have a winner!! {image} This appears to be plotting the volume delta in the same way I was calculating it on my spreadsheet. I have added a bollinger band on top to help identify relative climax from exhaustion, although it should be fairly obvious. I'm not really a fan of MT4 and I know its being phased out, but I think with this I can continue my observations and keep moving forward. Thank you Darryl very kindly for bringing this to my attention
Reviewing this indicator.

Darryl/Don, would you kindly explain how the buying/selling calculation is made?

Live example: the indicator in MT4 right now using Oanda states buying power is 54 vs. 0 selling power. A quick review of Myfxbook states retail have a whopping 123,000 short positions active.

The indicator looks good on first glance. Without testing it live my initial thoughts are: does it precede price as we're always taught volume does, or does it proceed price (lag)?
  • #654
  • Oct 11, 2019 8:14pm Oct 11, 2019 8:14pm
Quoting DonPato
Hello friends...I just wanted to bring up what I consider a major warning sign for anyone who still has a bearish bias on AUD/USD. {image} There is some MAJOR selling going on right now at a level that I would anticipate selling to occur. In fact at least 70% of the day's selling is occurring right now as I write this. While I would anticipate that this might happen, what I did NOT anticipate is that price continues to rise even though this selling is going on. Again...in spite of all this selling price's reaction is to continue to rise... Interpretation....
I would say it's short term bullish without having to undertake volume analysis. Given I am familiar with the work of Wyckoff etc, you would expect a short term bullish retracement in order to continue the overarching down trend. Right now it's 'expensive to sell'.

With that said, what gives your conviction based on the order flow? The underlying dominance of bullish blue volume? Trying to understand how to read those blocks, as at first glance my untrained eye could also lead me to think that the red blocks point to substantial selling.
  • #655
  • Oct 11, 2019 8:28pm Oct 11, 2019 8:28pm
Quoting Neogenesis
{quote} Reviewing this indicator. Darryl/Don, would you kindly explain how the buying/selling calculation is made? Live example: the indicator in MT4 right now using Oanda states buying power is 54 vs. 0 selling power. A quick review of Myfxbook states retail have a whopping 123,000 short positions active. The indicator looks good on first glance. Without testing it live my initial thoughts are: does it precede price as we're always taught volume does, or does it proceed price (lag)?
I do not use this indicator so I cannot really tell you about its calculation. But if you have the source code you can see for yourself how the end result is calculated. In answer to your question...yes order flow/volume does precede price movement but it is so fast it is almost indistinguishable.
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  • #656
  • Oct 11, 2019 8:36pm Oct 11, 2019 8:36pm
Quoting Neogenesis
..T.to understand how to read those blocks, as at first glance my untrained eye could also lead me to think that the red blocks point to substantial selling.
This is exactly right. In fact the majority of the selling occurred at that level. Yet price does not fall!! Now to be fair... toward the last few minutes of the day price finally did drop off. Considering that it is Friday and a long weekend many were "book squaring" ahead of the holiday. But the fact remains that with such heavy selling price should have been much lower but it wasn't. The only explanation is "absorption"...deep pockets were buying up those sell orders.

While I do expect a retrace I will be looking for buying opportunity at the dips and my bias is bullish.
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  • #657
  • Oct 12, 2019 7:42am Oct 12, 2019 7:42am
Ah - ok, good to know. The tick volume indicator on mt4 is showing the same (without the same level of insight).

I attempted to read the source code already, wonder if Darryl has any insights. If the data is legitimate and not repainting, I could see it being useful at validating assumptions.

I need to install Parallels again to get the volume profile tool on icmarkets as I am running on Mac, and therefore web client of cTrader. Looking forward to it and will share my thoughts in due course.
  • #658
  • Oct 17, 2019 2:59am Oct 17, 2019 2:59am
EURUSD price came back to previous seller's area. We expect some reaction here
Attached Image (click to enlarge)
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  • #659
  • Oct 17, 2019 3:07am Oct 17, 2019 3:07am
Quoting FXState
EURUSD price came back to previous seller's area. We expect some reaction here {image}
Sure. There are (sell) orders (as well as stop-loss orders) stacked from 1.1085 to 1.1110 (at oanda).
Return To Disorder
  • #660
  • Oct 17, 2019 9:07am Oct 17, 2019 9:07am
Quoting FXState
EURUSD price came back to previous seller's area. We expect some reaction here
It does my heart good to see you using the order flow chart and actually "seeing" the order flow in real time. I will be very interested to hear your review of this kind of charting and also how you think it helps (or doesn't help) your trading.

Upon looking at the EUR/USD I do see that area where the selling had occurred and now that price has risen above, I would like to point out something I consider very important (IMHO). On the chart you posted you can see that, at that point in time there was a great deal of selling (as was to be expected at a major resistance level). However the chart you posted shows, IMO, something extremely important...that price (1.10831) is ABOVE that area of selling and also the selling occurring on the open price is being absorbed by buying. Probably sellers stopping out. Note how "thin" the order flow/volume was right at the quoted price. This is the real battle and it appears the buyers are winning at the point in time you took that screen shot. Result? A true break out.

Now the fundamentalists will come and say, "of course there is a break out...the UK and EU were announcing a Brexit deal." And that is very true. However the fundamentals only explain some of the "why" but with the order flow data in real time you can now execute the "how", with a very high confidence.

This same thing is what I was trying to point out on my post on Friday with AUD/USD. As it turned out I got ahead of myself just a bit, BUT...price is now again back above that point. So there are also times when this kind of observation can truly be "predictive" even if it doesn't occur right away.
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