Skip to main content

NZD/USD: Volume Profile and Price Action Analysis

 

Hello guys,

in today’s day trading analysis, I would like to have a look at the NZD/USD.

There hasn’t been too much important action on the NZD/USD in the last couple of days, as it was only rotating sideways. But before that, there was a strong buying activity – a strong uptrend last Wednesday.

This uptrend area hasn’t been tested yet (the price did not make a full pullback there) and there is one nice Support I wanted to share with you.

Volume Profile Analysis

I used my Flexible Volume Profile to look in the trend area that formed last Wednesday.

It showed that there were two significant volume areas.

1st Volume Cluster (0.6950)

The first one was around 0.6950. However, the price has already made a pullback to this volume area and made a reaction to it. This makes that Support “tested” and spent. This means that I don’t consider it a Support anymore and I won’t be trading it.

NZD/USD; 30 Minute chart:

2nd Volume Cluster (0.6928)

The second Volume Cluster however, has not been tested yet. The price has not reached this area and haven’t made the “touch”. For this reason, this Volume Cluster is “active” and I consider it a viable Support to trade.

What this Volume Cluster (around 0.6928) represents is strong institutional Buyers who were adding to their Long positions as they were pushing the price upwards (into the uptrend).

When the price makes it back into this area again, then those Buyers will want to defend it. The reason being is they placed a lot of their Long orders there and this makes that zone important for them.

This is what makes this zone a significant Support.

The Volume Profile setup I used here is called the “Trend Setup“. It is called like this because I like to look for it when there is a trend – like the one I have been talking about today on the NZD/USD.

I hope you guys liked my analysis! Let me know what you think in the comments below!

Happy trading,

-Dale

Comments

Post a Comment

Popular posts from this blog

Bitcoin is Dropping Hard! Here’s Where Smart Money Will Buy Again

Video Transcript: Hello everyone, it’s Dale here. In today’s video, I’d like to talk about Bitcoin. The reason is that Bitcoin has been dropping like crazy, and a lot of traders are wondering where Bitcoin will go and what to expect. If I look at the chart and use Volume Profile, I would say that it’s pretty straightforward because Volume Profile very clearly shows the strongest support and resistance levels. So, let’s take a look at the chart, and let me show you. What you see before you is the daily chart of Bitcoin. This is the big picture, and as you can see, from the all-time high here, Bitcoin experienced quite a significant sell-off and is currently dropping. Right now, I don’t really see any strong support that would stand in the way of this strong sell-off. Let me use Volume Profile and show you what could actually stop the sell-off of Bitcoin. All right, so what I’m going to do is apply Volume Profile over this whole area to see the volume distribution. As you can see, there ...
Post a Comment
Read more

Quick In & Out Trade on USD/JPY – Smart Money Concepts & Volume Profile

Video Transcript: Hello everyone, it’s Dale here. Welcome to the next video of the new series, where I’ll talk about my recent trades. Today’s trade is on the  USD/JPY . It was a very quick in-and-out trade, so let’s check it out. What you see before you is the 30-minute chart of the  USD/JPY , and the level I was trading from was this short level at  149.63 . The reasoning behind this level—let me zoom in a little so you can see this better—was the volumes that formed here. From this place, there was a sharp sell-off. Even though the volumes do not particularly stand out, what’s important is that from this zone, there was a strong sell-off. There was also a  Fair Value Gap . My software highlights that, but when the gap is filled, it’s not highlighted anymore. If I mark it for you, this was the Fair Value Gap, which is a setup from Smart Money Concepts. I like to trade from the beginning of the Fair Value Gap, which is here. This is also the beginning of a heavy vol...
Post a Comment
Read more

ORDER FLOW: How to Trade the Absorption Setup (Trade Entry Confirmation)

Video Transcript: Hello everyone, and in this video, I’d like to talk about order flow and one of my favorite confirmation setups in order flow. The confirmation setup is called the absorption, and I’ll show you an example of a trade I made a couple of days ago. I think this is the perfect example of how you can use the absorption setup to confirm your trade entry. So, let’s take a look at it. First, let me start by showing you the level I wanted to trade, and then I’ll show you the absorption setup. You’re looking at the  EUR/USD  30-minute chart, and I had a long level here, marked by this line. This was a long level based on a Volume Profile setup, focusing on those heavy volumes formed within this important rejection. So, this was the long level. What happened was that the price started to go into a sudden sell-off, and there wasn’t really any strong macro news behind this. I wasn’t really sure what was going on, but there was this sudden sell-off, this spike move. Because...
Post a Comment
Read more