Video Transcript:
Hello everyone, it’s Dale here with a new video. Today I’m going to show you the best volume profile levels to trade this week. And this time we are going to talk about swing trades. What that means is that we are going to talk about daily charts. So what you see before you is a daily chart of the USD/JPY. I do all my swing trading analysis on daily charts because this is a slow-paced game and those trades take longer to develop, and that’s why I’m trading on the daily charts. So today it’s going to be daily charts only, and this chart is the USD/JPY. In here, I want to show you a strong support which is right here at 154.77
Let me show you how this area looks with volume profile. You can see that heavy volume bump. The level is based on it; it is essentially based on those volumes formed before this aggressive buying activity on the Japanese yen. This is basically telling us that there were buyers adding to their long positions here. We can see that on the volume profile here that’s the volume bump and then those buyers pushed the price aggressively upwards. And that aggressive movement is an important point because it’s telling us about the strength of the buyers, right?
So right now I’m waiting for a pullback and I’m going to trade from here. This is roughly the beginning of that heavy volume cluster. When the price hits this level, I currently have a limit order here and I’m going to go long from there. Now, this is the volume profile setup, but there’s also an additional setup that confirms this level. I need to zoom out a little bit to show you. As you can see, the price was reacting in here in the past exactly to this level. That means that in the past, this worked as a resistance, and the price turned it into a support when it blew past that resistance. So there’s a price action setup confirming this volume profile setup.
As I was saying, I’m currently waiting for this pullback, and if it occurs, then I’m going to go long from there. By the way, I’m currently in a short trade on the Japanese yen from this heavy volume zone. Let me show you with the volume profile like this. I’m short from here. What I’m planning to do is quit my short trade somewhere in here and then enter a long from this place.
All right, so that’s for the Japanese yen. Let’s now move forward and take a look at NZD/CAD. This is a daily chart of the NZD/CAD, and I’m currently in a short trade, but you can still join me because the price is around the place where I entered that short. I entered the short here at 0.8017
Let me show you the reason why I did that. If I use the volume profile like this over this area, you can see that there was a very significant heavy volume zone here. This is a place where sellers were likely active, building up their short positions. And from this heavy volume zone, you can see that the sell-off continued this aggressive selling activity. So I was waiting for that pullback, and when the price reached that level, I went short, and I’m currently in this short. As you can see, the price is just a couple of pips above that level, so you can join me and enter that short as well. There’s still plenty of time, I think.
Stop for this trade is here at 0.8090. The take-profit, at least right now, is at 0.7944. I’m likely to adjust the take-profit, probably to the heavy volume zone which we see here, so I’m probably going to move it a bit lower to this place. This is the beginning of a heavy volume zone and also the beginning of a fair value gap. So that’s where I’m going to move the take-profit, because chances are that there could be a reaction to this level, and I don’t want to risk that. So that’s why I’m going to quit the trade in here.
That’s for the NZD/CAD. Oh, one more thing I forgot to mention: there’s also that price action setup I mentioned with the previous trading example. Right here, there was a reaction, which means it was a support in the past, and it turned into a resistance here. So again, we have a price action confirmation of a level based on this heavy volume cluster.
All right, so that’s for the NZD/CAD. And the next one is AUD/NZD. In here, you see a daily chart of the AUD/NZD, and there’s a new short level that formed recently at 1.1496, right here.
Up until now the AUD/NZD was in a strong uptrend, but now it seems like that uptrend might be over. There was this low in here, and then there was this huge candle forming a fair value gap. Here’s the fair value gap. And that candle closed below this rejection it closed in here. So that might be a signal that the trend is reversing, and we might be able to take some nice shorts here.
The short I’m planning to take is from here. Let me show you with the volume profile. There is a significant volume cluster here in this place, and the level is the beginning of that heavy volume zone. So I’m waiting for the pullback, and when the price reaches the beginning of that heavy volume zone, I’m going to go short. It is not just the beginning of that heavy volume zone; it is also the beginning of a fair value gap. Let me show you. I like to trade from the beginnings of fair value gaps. In this case, this is the beginning of a fair value gap, and this is the whole fair value gap, and this is the beginning of it.
So that’s how I plan to trade this. Right now we just need to wait for a pullback. If it occurs and it doesn’t really matter when but if it occurs, then it is a short from there. Stop for this trade is here at 1.1573. Take-profit, at least right now, is at 1.1419. That’s risk-reward ratio one take-profit, but I might adjust it and move it a little lower so I’m a bit more over risk-reward ratio one.
If you guys are interested in learning more about volume profile trading, then head over to my website. It is Trader-Dale.com, and if you click “Trading Course and Tools” it will take you right to this page where you can browse my trading education and custom-made indicators. You can get them separately here, or scroll down a bit and get them all together for a discounted price.
Now before I wrap the video up, I’d like to announce the winner of the contest we had last time. The prize of the contest was my custom-made Volume Profile and VWAP indicators for the TradingView platform. Right now on your screen, you see the name of the person who won the contest. Congratulations to the winner.
And I’ll do another contest for next week. The only thing you need to do to participate in this contest 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.
So that’s about that. Thanks for watching the video, and I’ll be looking forward to seeing you next time. Until then, happy trading.
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