Video Transcript:
Hello everyone, it’s Dale here with a new Weekly Trading Ideas video. Today, we’re going to take a look at three trading ideas — the first on the euro, then we’ll look at the Canadian dollar, and the last one will be on the Swiss franc. So, let’s check them out. What you see before you is the NinjaTrader 8 platform with my custom-made Volume Profile and VWAP indicators. This is a 30-minute chart of EUR/USD. On EUR/USD, I want to talk about a newly formed resistance here at 1.1613. This resistance is based on a heavy volume zone. Let me show you — this is the heavy volume zone it’s based on. As you can see, there was a sharp sell-off from this area. That tells us sellers were building up their short positions here and then initiated aggressive selling, pushing the price downwards. This heavy volume zone is important for sellers because they placed many of their short positions there. So, if there’s a pullback to this level in the future, it’s likely that sellers from here will want to defend this place and push the price downwards again. I’ll definitely want to trade shorts from this level.
By the way, if you’re already experienced with Volume Profile and using the tool, you might have noticed this heavy volume zone right here. Usually, I’d trade shorts from there — from the beginning of the heavy volume zone — but I’m a bit hesitant this time. If I zoom in, you can see these two highs are at the same level. That’s a failed auction, and price likes to test that. So, if price comes close to this high-volume zone, there’s a risk it’ll test that failed auction — move above this high and the previous one. That’s why I’m not really interested in shorting from that level, since there’s a failed auction right above it.
All right, that’s it for the euro. Let’s check out USD/CAD now. This is a 30-minute chart of USD/CAD. Here, I want to talk about a support level at 1.3899. This support level is based on a Volume Profile setup I call the Rejection Setup. You need to see a rejection first, and here it’s very visible. This is a rejection of lower prices — sellers were pushing the price down, and then buyers stepped in and rejected the lower prices. That’s why it’s called a rejection setup — they pushed the price up from there. So, first, you identify a rejection like this one, but that’s not all. You also need to see a heavy volume zone around where the price turned. For that, we use the flexible Volume Profile to look specifically into that rejection area.
As you can see, there’s this heavy volume bump, and that’s exactly where buyers stepped in, started buying, and reversed the sell-off into a new uptrend. This heavy volume zone is a very important level, and I like to trade from the beginning of it, which is here at 1.3899. I also like to see a fair value gap when there’s a rejection — there’s just a small one here, but better than nothing, right? The fair value gap shows the aggression of buyers who stepped in and turned the price. So now, I’m waiting for a pullback, and when the price hits this level, I’ll go long from there because the buyers from here will likely become active, defend this place, and push the price upwards again.
Now let’s take a look at the next trading idea — this one’s on USD/CHF. This is a 30-minute chart of USD/CHF, and the level I want to talk about is at 1.7989. This is a support level, and it’s based on a heavy volume zone from which a strong trend started. When you see a heavy volume zone followed by an aggressive trend, like here, it’s a sign that buyers were building up positions before pushing the price up. You want to trade from that heavy volume zone. Usually, I trade from the beginning of the zone, which would be here, but in this case, I also want to trade from the beginning of a fair value gap — there’s a very small one, highlighted in green. That’s why I placed the level slightly lower than usual, hoping price will test that fair value gap before reacting.
So, that’s the plan — wait for the pullback, and when price reaches this area, the buyers from this heavy volume zone should become active and push the price up again.
If you’d like to learn more about Volume Profile trading, I recommend visiting my website, Trader-Dale.com. Click Trading Course and Tools, and it’ll take you to a page where you can join us. You’ll find my educational and indicator packs there — the Volume Profile Pack, Order Flow Pack, and Smart Money Pack. You can get them separately, or scroll down to get all of them together in one discounted bundle.
Before wrapping up, 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. You can see the winner’s name on the screen right now — congratulations! I’ll be running another contest this week. To participate, just leave a comment under this video on YouTube, and next week I’ll randomly pick one person to win this set of custom-made indicators.
That’s all for today. Thanks for watching, and I’ll look forward to seeing you next time. Until then, happy trading.
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