Video Transcript:
Hello everyone, it’s Dale here with a new weekly trading ideas video. Today we are going to take a look at the ES, NQ, and USD/CHF, and I’ll show you one particular setup which you can use on all those three pairs. But before that, a very very quick note about a Black Friday sale which I’m currently running on my website. If you go to trader-dale.com and click Trading Course and Tools here, then it will take you to this page where you can get discounted education and indicator packs. You can get the Volume Profile pack, the Order Flow pack, the VWAP pack, and the Smart Money pack. You can get those separately here for a discounted price, or scroll down a bit and here is a special Black Friday deal where you can get all four packs together for a massively discounted price right here. Right, so that’s about that, and now let’s take a look at the charts.
The first chart I would like to talk about is the ES. What you’re looking at now is the ES 30-minute chart. This is the NinjaTrader 8 platform with my custom-made Volume Profile and VWAP indicators. And the setup that I would like to talk about is right here. First step is you need to see a strong rejection, which means the price goes aggressively one way, then suddenly turns and goes the other way. So you need to see something like this. That’s step number one.
Step number two is you need to see a significant volume cluster, and for that you need to use Volume Profile. You need to use the Volume Profile around the area where the price made that rejection, which in this case is this area. All right, so you need to see a significant volume cluster, which in this case is this volume cluster right here. What it represents is a place where buyers started to jump in and they started to buy aggressively, and eventually they turned this sell-off into this buying into this uptrend. Right? So this is the important place where the buyers jumped in, and you want to trade from this place because it is an important place for buyers. So what you do is you print a line here, and it becomes a support line at the place where the heavy volume zone begins, like here. In this case on the ES, the level is 6700. It is the beginning of the heavy volume zone. And when there is a pullback, chances are there will be a reaction from the buyers who were active here.
What I also like to see when there is a rejection setup is a fair value gap. It’s highlighted here in green. Fair value gap and here is its beginning. I like to trade from the beginning of the fair value gap in the long-trade scenario. That’s why the level is exactly at this point. I like fair value gaps because a fair value gap represents a place where the price moved aggressively. It shows aggression so in this case, aggression of buyers. So basically what we have here are three things: strong rejection, heavy volume cluster, and fair value gap. All right, that’s what makes this level a strong one. Now we need to wait for the pullback and take it from there.
Now let me show you something. Let me go to AUD/USD. There was the same thing. I had a long level there and it already played out, so let me show you how it looks when it plays out. There was this strong rejection. There was a significant volume cluster. There was a fair value gap exactly the same thing, right? My long level, which I also published in the members area for all members to trade, was here at 0.6514. All the members have it on their charts like I do with this dotted line. That’s done automatically. But anyway, this was the level, and this is how the price reacted to it. So this is how it is supposed to look. This is how the price is supposed to react to this level, or to this setup.
We talked about the ES, and now let’s go to the NQ where there is a very very similar thing. This is a 30-minute chart of the NQ and we have a strong rejection of lower prices that’s step number one. Step number two is to use Volume Profile. You need to use the Flexible Volume Profile which you can move around like this to select only specific areas of the chart. In this case you are interested in that rejection, and you need to see a significant volume cluster like this one. That’s step number two: significant volume cluster somewhere around the place where the price turned. Third thing is the fair value gap. In this case it is here this huge fair value gap which shows aggression of buyers. And I like to trade from the beginning of the fair value gap in the long scenario, which is here. That’s why the level is at 24,765. All right. So currently I’m just waiting for a pullback, and once the price hits this level I’m going to go long from there. Exactly the same setup, exactly the same logic as with the previous examples.
Now the last one is on USD/CHF. Here it’s exactly the same thing. We have a strong rejection of lower prices that’s step number one for this setup. Step number two is a significant volume cluster. We also have this lower one, but I selected the higher one because it has a fair value gap close to it this being the fair value gap. In this case I also had to think about stop-loss placement. I want to place the stop here at the low of this rejection. So this is going to be the stop. If I placed the long level at the beginning of the fair value gap here, it would be too far from the stop. So that’s why I placed it a little lower, at the heaviest volume peak of this first volume cluster. This is where I plan to take my long from. It is at 0.7897. Currently I’m waiting for the pullback. When the price hits this level, chances are there will be a reaction because those buyers who were active here before should step in and push the price up from there again.
Before I wrap the video up, I’d like to announce the winner of a contest we had last time. The prize of the contest was my custom-made Volume Profile and VWAP indicators for the TradingView platform. And right now on your screen you see the name of the person who won the contest. So congratulations to the winner. And what I’ll do next is another contest for next week. The only thing you need to do to participate is leave a comment below this video which I’ll publish on YouTube. Next week I’ll randomly pick one person to win this set of custom-made indicators.
That’s about that. Thanks for watching the video and I’ll be looking forward to seeing you next time. And until then, happy trading.
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