AKAM: Dark Pools & Pro Traders Patterns Ahead of Earnings TodayAkamai Technologies Inc. reports earnings today with a solid start to a bottoming formation with Dark Pools' and then Pro traders’ footprints. The stock is currently at a completion level for the short term bottom. A Shift of Sentiment™ pattern formed between October and January. AKAM moved lower before finding the final low support from a previous Dark Pool Buy zone while Accumulation/Distribution indicators exposed the positive divergence. The pattern is a setup for a swing trade, not a position trade opportunity yet.
Volume
Identify Impulse and Corrective MovesMarket moves can generally be categorized as either an IMPULSE move or a CORRECTIVE move.
A fast and strong move is described as an IMPULSE move.
A slow and weak move is described as a CORRECTIVE move.
Practical Exercise
1) Pick any currency pair, any timeframe, and identify the IMPULSE and CORRECTIVE moves on the chart.
2) Draw a line on the IMPULSE move; draw a box on the CORRECTIVE move.
3) Post your chart on the comment section below.
4) Repeat this practice on 2 other currency pairs.
Gaps in the volume profileJust a example to show how gaps in the Volume Profile caused during fast falls or rises in price are filled at a later date.
The gap between 4200 down to 3800 during the drop on 24th November was filled just over 24 hours later.
The left window shows the volume profile prior to the drop and up to the bottom of the drop.
The right window shows the volume profile from the start of the rise back up to 4000.
I have displayed the volume profiles back to back to make it easier to visualise.
The range of the gap in the volume profile has been marked with a box extending across both sides.
There are some other boxes in the chart that mark previous volume areas from last year.
This was created on my working chart and I didn't want to spend the time hiding them or opening a new chart for this example.
Going Full Wab with WABIBTC: 20% Gain over 3 Days in 6 TradesDid you know that the word "wab" is a word? Seriously, check it out. Anyway, as much as I love trading high-volatility altcoins, I really don't like doing it on 15 minute periods. For most alts, you're risking getting stopped out due to dumps that are happening in the meantime.
Yet, if you're willing to shoulder some risk and the market is "generally" positive, there's money to be made. That's the case with WABIBTC over the past 3 days. The chart has been mostly sideways, trading within a tight range. But when it exploded earlier today and left me with a >10% gain , I figured I'd share the results with my fellow traders.
As you can see, my indicator signaled 6 profitable trades. Although two of them were for virtually nothing, when you are automating and have things set up correctly you can get out without too much trouble.
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List of Entry Signals + Trades Captured with the AllCryptoSignals Volume Pressure Gauge
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Here's a quick list of WABIBTC trades over the past three days. These exact trades can be made with the following two tools:
1) My AllCryptoSignals Volume Pressure Gauge Indicator ( )
Chart period: 15 minute, VP Gauge setting: 12, Alert Crossing Up over -1
2) An automated trading bot that buys on my signal and sells using a trailing stop once hitting a specific price gain (Gunbot + Trailing Stop - Stop Limit or any other bot that supports a trailing stop is perfect!)
Trade #1 - 3.5% (3 hours)
Trade #2 - 1% (4 hours)
Trade #3 - 1% (2.5 hours. Exited manually)
Trade #4 - 1% (3 hours. Automated exit due to the recent negativity)
Trade #5 - 4.5% (1.5 hours. Finally a decent gain!)
Trade #6 - 11% (There's the pump! Got out right on time.)
There are pros and cons to setting my VPG indicator to a high setting. On the plus side, the trades are generally safer and function better with low-volume altcoins. On the downside, the signals come a bit later so you end up missing potential gains. Oh well!
What are your thoughts? Have you been trading WABIBTC or just sitting this round out?
AllCryptoSignals
(Learn more about the AllCryptoSignals Volume Pressure Gauge indicator here: )
Liquidity Pool / Stop Loss Explanation POE SignalA group member had a question about why the stop loss was "so low" being 23% under the buy price. The reasoning is you need to avoid the liquidity zone, where price could easily be pushed.
The purpose of our stop is to exit the trade if its no longer valid (not get stopped out only to see a pump happen afterwards). This could be another accumulation cycle, so we want to ride out the potential for a dip.
As normal traders we normally dont have to deal with extremely large positions. But the whales/institutions who do have to think about liquidity very differently than you or I. Order flow intersections are what they look for. They have to go TO the liquidity - which is many times where people end up placing their stops. They cannot simply accumulate or distribute a large position whenever and wherever they wish. Rather, they must look to those levels where liquidity is aggregating, and stops are helping them in an indirect way.
Without a Support/Resistance Finder (SRF) to help you, you can also/alternately use a volume profile as shown. SRF auto plots the S/R lines for the current range (all the horizontal dashed red and green lines are done by SRF). You want to place your stop BELOW where the liquidity is likely located - and also where your trade idea is invalidated.
In the opposite sense there is a liquidity zone above as well. Many times you will see price probe the same levels over a few days. This is testing the resistance and seller appetite. You can see this here in the 210+ area as price has been probing the upper resistance.
Fundamentals of the Head and Shoulder BottomMany of the educational posts out there are mere examples of past chart patterns that have already completed themselves. Which this is an excellent way to study data and to help predict future movements, it tends to create over-confident traders.
As many of us know that there is no 100% guarantee to any chart pattern. However many people, myself included, sometimes become too stuck on one pattern and its outcome, and to not fully recognize the fact that it can fail.
Leading to why I decided to make this educational post, whether this pattern completes itself or not, it is here to show you what trading is actually like.
The chart above displays a textbook Head and Shoulders Bottom (also called Inverse Head and Shoulders) pattern forming. However, this pattern has yet to fully complete itself, and even if it does, it may or may not hit our preferred target.
But lets break down the fundamentals of a Head and Shoulders Bottom.
Prior Trend : The reason it is called a head and shoulders bottom pattern, is because it occurs after a previous downtrend. So we first must check that the trend is down before considering this pattern.
The Body : The reason it is called a head and shoulders pattern is due to its shape. The head is ALWAYS the lowest point in this pattern, while the left and right shoulders sit at similar levels above the head. All three of these points then share the same resistance level know as the neckline.
Neckline : The neckline forms by connecting the highs following the left shoulder and the head of the pattern. This line can slope up, slope down, or be horizontal. This is the key level to break in this pattern.
Right Shoulder : There seems to lots of controversy with the right shoulder, some believe that this level must at the exact same or higher level than the left shoulder. However this is not the case. While symmetry is preferred, sometimes the shoulders can be out of whack, and the right shoulder will be higher, lower, wider, or narrower.
Volume : Since this pattern forms on the bottom of bear trends, there should be heavy selling volume on the left and right shoulders, while the right shoulder should be accompanied by light selling pressure.
The most important moment for volume occurs on the advance from the low of the right shoulder. For a breakout to be considered valid, there needs to be an expansion of volume on the advance and during the breakout.
Neckline Break : In order for this pattern to complete itself. There MUST be a break above the neckline . Otherwise the neckline remains resistance the the trend continues downwards.
Confirmation : Some believe the the neckline break serves as confirmation. However the real confirmation is once the neckline which once acted as resistance, later acts as support.
Target : The preferred target may be measured by taking the distance from the bottom of the head up to the neckline. While this is just a preferred target, one must consider other possible resistance levels.
Remember, even with all the patterns out there, there is never a 100% guarantee in trading.
I wish you all the best of luck!
I Hope you all found this educational post intresting and maybe even a little helpful!
DISCLAIMER:
Please note I am only providing my own trading information for your benefit and insight to my trading techniques, you should do your own due diligence and not take this information as a trade signal.
ETH potential long levelsI have mentioned a few times that ETH is my favourite fundamental pick in the complex. I wouldn't pretend to know details about the technologies, but the resilience of ETHUSD in the latest selloff further boosts my conviction. Presenting some chart analysis here.
There is a new significant zone emerging at the 735-740 level. I would stay flat below that level in order to preserve capital. I still place value in the 755 level which was the last PoC, would get half long above that and add to it on a breakout of the 775 level. It can be quite difficult to be patient to buy at a higher level, but that is the key to capital preservation imho. Should the complex sell off further, even the strongest tickers will follow lower. The key is to wait for the market to stabilize, and then get behind the strongest of the bunch.
“Do not anticipate and move without market confirmation—being a little late in your trade is your insurance that you are right or wrong.” -Jesse Livermore
Volume Profile - Fixed Range/Session Volume/Visible RangeVolume Profile (The explanation here is extremely detailed. The actual use I explain is the second bottom half)
1. Introduction
2. Use Options
3. Terminology
4. Example
5. Conclusion
1. Introduction
The Volume Profile is an extremely useful tool that can give you an expanded view of actual price pressure if you struggle to find support levels.
There are a number of strategies the Volume Profile was designed to be used for, but I have found over the years most of it is useless in Crypto or it can be found with better methods. I will cover what I use it for in this educational piece.
Most traders use the default Volume indicator that measures Volume based on time instead of price levels. While this is semi useful, I remove that on all of my charts and use Volume Studies that are based on price levels for a more accurate view.
The Volume Profile can be found in the indicators section on TradingView shown in the link below.
imgur.com
As a note, I do change my settings depending on how I am using this indicator. I do enable Show Values, so I may see a detailed look at actual numbers. Also, I do change the amount of rows (Row Size) depending on how detailed of a look I need for the current situation. For the most part, I disable the P.O.C., Developing P.O.C., and Developing VA. I have found these features to clutter what I am looking at and not provide me with any kind of accurate or useful information. Some traders will disagree, but in reality they are just added features that rarely apply to crypto trading as a strategy. However, there may be times when they are useful and there is actual strategies that can be used, but I will not cover them because it will waste everyone's time.
2. There are 3 different ways to use it:
Fixed Range- This is used for a set number of candles. Upon clicking this, you then select the area you would like to study. This is extremely useful when studying past fractals and how they would apply to current price action. Also, they are useful when studying how a catalyst or black swan affected the price of an asset for future theories and trading preparation.
Shown below is a Fixed Range from December 10th to the 19th for Ethereum. ($415-$861)
Session Volume- This measurement takes the Daily close no matter what time frame you are viewing and sets individual measurements for that 24 hours.
Shown below is a the last 3 days as of this writing for Ethereum.
Visible Range- This option is useful for quick views of price levels that automatically adjust as you zoom in and out of the chart. Whatever candles are visible on the chart, it shows trading Volume at those price levels.
Shown below was Ethereum's last rally from $300-$1,425 and current correction. (Values have been disabled & row amount/size is set at 100)
3. Terminology
Point of Control (P.O.C.) – The price level for the time period with the highest traded volume.
Profile High – The highest reached price level during the specified time period.
Profile Low – The lowest reached price level during the specified time period.
Value Area (VA) – The range of price levels in which a specified percentage of all volume was traded during the time period. Typically, this percentage is set to 70%. However, it is up to the trader’s discretion.
Value Area High (VAH) – The highest price level within the value area.
Value Area Low (VAL) – The lowest price level within the value area.
BTCEUR, example of a trend break after active accumulation.Example of a trend break after active accumulation.
The analysis was performed using the X-volume indicator. Thin vertical dashed lines indicate candles with active accumulation. The blue dashed lines indicate the process of redistribution. For details, refer to the instructions for the indicator. It should be noted that it is not true to speak of a trend change analyzing only a few bars.
How to enter a trade (entry signals) for CTR/BTC price spikeHi all.
I've had some PM's about the price spike we had for CTR/BTC over the last 24 hours, given that I did some analysis on this a few days back.
I've recorded this vid to provide some context around what you should have been looking for! There's also some time spent on what not to do, which will hopefully be useful for newer traders.
Hope it's useful. Let me know any feedback or other things that you would like covered.
Cheers and good luck,
RJR
THE IMPORTANCE OF VOLUME ANALYSIS: Part IIThe wave is currently finalized and is working as planned:
I ended the previous post pointing at the lack of the volume required to confirm trend reversal at supposed point 5.
And in fact, for quite a while the price kept slowly drifting up and down without substantial moves in any direction.
This situation lasted until bearish volume spike on 07/11 that initiated real trend reversal.
It is also necessary to point out that though that spike was only medium in nature, but the change in its volume compared to previous data was sudden and drastic.
Later the volume changes were driving the price accordingly up and down, but most importantly the local bearish trend was established and continued successfully.
Currently, the price is close to the crossing of the line 2-4 at which volume dynamics should be carefully monitored as this may provide a good tip if this is really the end of the analyzed downtrend.
If you have any questions, feel free to ask in comments or PM me.
Wkly BTCE - normal consolidation after big surgeToday's tutorial session was all about long term viability. While it is one thing to have a sound fundamental idea, it is quite another to have a good trade setup. Ideally, as rational investors, we only want to buy when both fundamental and technical indicators are pointing in the same direction. Unfortunately, while the fundamental story for BitCoin still seems to be sound, technically the story is not. Supply has overwhelmed demand of late (With news of China's forced liquidation and ban of BitCoins that adds further supply over the short term) and as a result price has made lower highs and lower lows.From a cyclical perspective, if the bull/bear cycles repeat then one ought to expect to see about six months of consolidation before any new move can begin in earnest. Based on volume alone I believe that signal will be quite clear. Should we get a weekly bullish session where volume surpasses the recent down bar peaks then we will know buyers have once again taken over.