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USD/JPY: Volume Profile & VWAP Analysis (24th July 2024)


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Video Transcript:

Hello everyone, it’s Dale here with a new day trading analysis. Today, I’d like to talk about the USD/JPY. What you see before you is the NinjaTrader 8 platform with my custom-made volume profile and VWAP indicators, and you’re looking at a 30-minute chart of the USD/JPY. Today, I’d like to discuss a newly formed resistance at 155.25.

This resistance is based on a couple of factors. The first is a volume profile setup. If you examine the trading activity using the volume profile tool, you can see a significant volume bump here. It’s not as strong as it could be, but with the confluence of other factors that I’m going to show you, this makes for a pretty strong zone. We have a downtrend with a significant volume bump here. Another factor that adds strength to this level is that this aggressive sell-off started from this heavy volume bump. If you’re familiar with smart money concepts, this is known as a fair value gap, and from there, we saw a strong sell-off. We have aggressive sellers who may have been building up their short positions here or adding to their positions, then aggressively pushing the price downwards. It is likely that when the price reaches this zone, the beginning of that heavy volume zone, there will be a reaction from those aggressive sellers again.

This is not the only thing about this level. Another factor is that if you look closely, the price made a very sharp reaction to this zone, not exactly to the level but very close to it. This indicates that it was a support level in the past, which got breached, turning it into new resistance. As you can see, it aligns with the level identified using the volume profile.

Additionally, at the top of all that, is the first deviation of the weekly VWAP, represented by the gray line here. The price tends to react to it when it’s trending. Right now, the price is moving below that first deviation. When this happens, the price tends to pull back to it and react, as shown in these examples. Ideally, the weekly VWAP will stay around the level at the time of the pullback, as this would increase the chances of a strong reaction. If the first deviation continues to trend downwards, the level remains strong, but it would be preferable if the first deviation were around at the time of the pullback.

These are the reasons why I like this level. Hopefully, we will see that pullback soon. To increase your chances of a successful trade, you can use order flow software to better time your trade entry or confirm your trade entry and better time your trade exit when the price approaches the level.

Now, there’s one more thing I wanted to show you. It’s a level on gold that I published a couple of days ago, so it’s an older level. You can find the original analysis on my website. Here, I wanted to show you this support level, which was based on the weekly point of control. This means the heaviest volumes throughout this week on gold were in this area. From there, strong buying activity started, and in the video, I mentioned that this should work as a strong support, and here’s the reaction. I hope you guys are trading it; it was a very nice reaction. Everyone who saw that analysis had the chance to jump in here and make a nice profit.

If you’d like to identify such levels yourself and get your hands on my custom-made volume profile, VWAP, and order flow indicators, head over to my website, trader-dale.com Click on the “Trading Course and Tools” button, which will take you to a page where I’m currently running a special Independence Day Sale. You can get my best educational and indicator packs at a massive discount. The volume profile pack will teach you everything about volume profile trading, and the VWAP pack will teach you everything about day trading with order flow. There are videos you can watch for more detailed information on what you’re getting. There’s also a special deal where you can get both the volume profile pack and the order flow pack together in a discounted bundle, available until the end of this month when the Independence Day sale ends.

Thanks for watching the video, and I look forward to seeing you next time. Until then, happy trading!

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