Video Transcript:
Hello, everyone! It’s Dale here with a new weekly trading ideas video. What you see before you is the NinjaTrader 8 platform with my custom-made Volume Profile and VWAP indicators. The chart before you is the EUR/USD 30-minute chart, and in today’s video, I’d like to focus on showing you how to trade the Weekly Point of Control. Let’s focus on that today because there are currently a couple of very nice levels based on this strategy.
Let me show you an example on EUR/USD. If you look at the Weekly Volume Profile, which is this volume profile on the left, it shows how the volumes were distributed throughout the whole previous week. As you can see, the heaviest volumes were right here, and this is called the Weekly Point of Control. From this Weekly Point of Control, the price made a strong sell-off. This means sellers were building up their short positions in this rotation, forming the Weekly Point of Control here, and then they pushed the price downward. This rotation is a very important zone for the sellers, and for that reason, I think it’s very likely there will be a reaction to it. If there’s a pullback, there’s a chance of a reaction like this.
The reason I have resistance exactly here at 1.032 is because there’s a Fair Value Gap highlighted in red. This entire zone is the Fair Value Gap, a concept from smart money trading. I like to trade from the beginning of the Fair Value Gap, which in this case is right here. That’s the beginning of the Fair Value Gap. Now, we just need to wait for a pullback. When the price reaches the beginning of the Fair Value Gap, at this level, we go short from there.
Alright, that’s for EUR/USD. Now let’s jump into the next trading idea. The next one will be on the ES. This is a 30-minute chart of the ES. The ES is the futures contract for the S&P 500 index. The level I have here is very similar to the one on EUR/USD. If you look at the Weekly Profile, this one shows the volume distribution throughout the whole previous week. The Weekly Point of Control is here. Again, this was formed within a rotation from which strong selling activity started. This strong selling activity indicates that sellers were dominating the market. For that reason, I think those sellers were active in this rotation, adding to their short positions.
Now, very similarly to EUR/USD, I have my resistance level here at the beginning of the Fair Value Gap. Again, this red-highlighted zone is the Fair Value Gap, and the beginning of the Fair Value Gap is at 5942.5. That’s the resistance. As you can see, it is at the beginning of this heavy volume zone where the Weekly Point of Control formed, and also at the beginning of that Fair Value Gap. Now we just need to wait for the pullback, and if it occurs, we take it from there. It’s a very similar scenario to EUR/USD.
Oh, and one more thing I wanted to show you here. Notice how, when the price is trending and moving below the first deviation of the Weekly VWAP, it reacts nicely to the VWAP. It reacted here and also during this beautiful pullback to the first deviation of the Weekly VWAP, with a reaction here. By the way, that’s also one of my strategies for trading with VWAP. But anyway, those are trades that have already played out. Let’s now focus on the levels that haven’t been tested yet and move on to the next trading idea.
The next one will be on the NQ. This is the 30-minute chart of the NQ. Again, let’s start by looking at the shape of the Weekly Volume Profile. This shows how volumes were distributed throughout the whole previous week. This is the Weekly Point of Control. What I have here is a resistance level. It is not exactly at the Weekly Point of Control but slightly before it. The beginning of the Fair Value Gap, highlighted by the indicator, is the key zone. The level is at 22725. Again, it’s the same combination: the Weekly Point of Control (even though it’s not exactly at our level, it’s still in proximity) and the beginning of the Fair Value Gap.
If I use my flexible Volume Profile like this, you can see there were actually heavy volumes formed in this small rotation before the sell-off. Even though the Weekly Point of Control is slightly higher, another significant volume zone was formed here before the selling started. I believe this should create a barrier—or, in other words, a resistance—which the price should react to. Let’s wait for the pullback, and if the price reaches this zone, we’ll go short from there. Chances are the sellers from here will want to defend this area because it’s clearly important to them. They placed a lot of their short positions there and will likely push the price downward again.
If you’re interested in learning more about Volume Profile trading, head over to my website at Trader-Dale.com. If you click the button that says “Trading Course and Tools” it will take you to a page where you can explore my trading education and custom-made trading indicators. There’s the Volume Profile Pack, focusing on Volume Profile trading; the Order Flow Pack, focusing on day trading with Order Flow; and the brand-new Smart Money Pack, focusing on smart money trading. All these packs come with video courses, custom-made trading software, and dedicated tech support. If you scroll down a bit, you can get all three courses together at a discounted price.
If you’re interested in day trading with me and other prop firm traders daily, I recommend checking out my brand-new service called the Funded Trader Academy. You can find it on my website. There’s a video explaining everything in detail, and if you think you’re ready to join us, you can book a one-on-one call to decide whether this service is right for you.
Before wrapping up the video, I’d like to announce the winner of last week’s contest. The prize was my custom-made Volume Profile and VWAP indicators for the TradingView platform. The name of the winner is now displayed on your screen—congratulations! For the next week, I’ll run another contest. To participate, simply leave a comment below this video, which I’ll publish on YouTube. Next week, I’ll randomly pick one person to receive this set of custom-made indicators.
Thanks for watching, and I’ll see you next time. Until then, happy trading!
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