Skip to main content

CHF/JPY: Volume Profile and Price Action Analysis

Trader Dale - Free Book

In my yesterday’s video, I showed you how to use Volume Profile when there is a trend.

Today, I am going to give you one more example. I will show you this on the recent development of CHF/JPY.

Yesterday, and today the CHF/JPY is trending strongly. There is an uptrend and Buyers are clearly in control.

When there is such a trend, then I use my Flexible Volume Profile to look into the volume distribution within that uptrend.

What I want to see there is some significant volume area (I call these “Volume Clusters”).

Such area often represents a strong Support/Resistance zone.

Volume-based Support Around 118.31

In this case, there was a really strong volume area formed around 118.31. This area indicates, that the Buyers who are pushing the prices upwards were adding massively to their Long positions there.

This is what tells me that this is an important place for them.

CHF/JPY; 30 Minute chart:

When the price comes back into this area again, it will still (most likely) be an important place for them.

This means they will want to defend it. So, when there is a pullback to 118.31 at some point in the future, then those Buyers are likely to start buying aggressively in order to help the price stay above 118.31 and to push it upwards again.

This is what should make this area a strong Support.

This setup is one of the basic Volume Profile setups, and I call it the “Trend Setup“.

What do you guys think? Did you spot this Support too? Let me know in the comments below!

Happy trading!

-Dale

P.S. There is an upcoming FREE WEBINAR this Thursday 18th Feb. You can enroll by clicking the banner below. See you there!

Comments

Post a Comment

Popular posts from this blog

Beginners Guide to Order Flow PART 1: What Is Order Flow?

DEFINITION: Order Flow is an advanced charting software which enables you to read all trading orders that are processed in the market. It helps to track the BIG financial institutions through the trades they make. Most people get confused when they open up a chart with Order Flow for the first time. There is no shame in that. Order Flow shows so many information and it is easy to get overwhelmed and confused if you don’t know what to look for! This Beginners Guide will teach you how to understand how Order Flow works and how you can use it in your trading! In this 1st part of the Order Flow Guide I will show you around the Order Flow interface. Footprints The Order Flow does not show standard candles, but it shows FOOTPRINTS . A footprint shows not only Open, High, Low, Close (as standard candles) but it also shows orders traded in that candle. Orders can be...
Post a Comment
Read more

NZD/CHF – How To Trade The “b-Shaped” Profile

Today’s intraday analysis will be on  NZD/CHF  and I will start by talking about the structure of the  Weekly Volume Profile . Weekly Volume Profile structure In the previous week, there was a  “b – shaped” Volume Profile histogram formed. b – shaped histogram means that the shape of the histogram  looks like the letter “b”. It says that the market sees the value at the bottom half of the profile while rejecting the upper half. If you look at the picture below, you can see that there was a  rotation  (Monday, Tuesday), then strong  buying activity  (Wednesday), and then an immediate  rejection and a sell-off  (Thursday). Then again a  rotation  on Friday. One of the most important things to notice in a b – shaped profile is a  volume cluster created in the rejection area. In this case, there were two of them. Such a  volume cluster  indicates a place where the  sellers were...
Post a Comment
Read more

How To Trade The Point Of Control (POC)

DEFINITION: Point Of Control (= POC) is a price level at which the heaviest volumes were traded. The most important thing that the Volume Profile indicator shows is the POC. I dare say that if you used Volume Profile only for the purpose of identifying the POC, you would be a way better and trader then 99% of the retail traders. No matter what trading strategy you trade. Why do I say this? Why is POC so important? Point Of Control is so important because it shows the place where the most trading took place – where the biggest trading positions were accumulated. POC shows the BIG guys! Who accumulates those huge trading positions? The BIG guys – that’s the big financial institutions like hedge funds, pension funds, huge banks, etc… It is those BIG guys who move and manipulate the markets. It would be a huge advantage to know where they placed most of their positions, right? The good news is th...
Post a Comment
Read more