Video Transcript:
Hey everyone, it’s Dale here, and in this video, I’ll show you the strongest Volume Profile levels to trade this week. We’ll take a look at a couple of intraday levels on GBP/USD, AUD/USD, and USD/CAD. So, let’s get to it.
What you see in front of you here is the NinjaTrader 8 platform with my custom-made Volume Profile and VWAP indicators. This is a 30-minute chart of GBP/USD. Here, I want to talk about a support level that formed on Friday. Here is the support. It is at 1.3423, and it is based on this sharp rejection that occurred on Friday.
A sharp rejection, if you look only at the price action chart, means that the price was dropping rather aggressively, and then buyers stepped in, completely reversed the price, and pushed it upwards. When you see a sharp rejection like this, you want to look inside the rejection with Volume Profile and identify a significant volume cluster somewhere around the place where the price turned from the sell-off and started moving upwards.
In this case, we have this significant volume cluster, and it represents a place where buyers started to jump in. This is an important place because a lot of buyers were active here. What I want to do now is wait for a pullback, and when the price hits this level, I expect those buyers to jump in again and push the price upwards from there. Right? So, that’s the whole setup.
In addition to that, I also like that we have a rather huge Fair Value Gap from Smart Money Concepts here. Right? The Fair Value Gap begins right at our level, and that adds strength to the level. Okay? We have the beginning of a Fair Value Gap as well as the beginning of that heavy volume zone.
For those reasons, I think that if the price drops to this level, there is a solid chance that it will reverse there again, as the buyers from here will want to defend this place, which was important to them in the past. Right? So, that’s the long level on GBP/USD.
Let’s now take a look at AUD/USD. Here is a 30-minute chart of AUD/USD, and I want to talk about a support level that is here. It also formed on Friday, and this one is at 0.6983. By the way, we are still looking at the 30-minute time frame.
Back to the level, we have this strong uptrend here on Thursday. This volume cluster inside that uptrend tells us that the buyers who were pushing the price upwards were adding to their long positions here, in this place, as they were pushing through this rather strong high.
This was probably a strong resistance level in the past, and the buyers were pushing through it. That’s why we have those volumes here. Now, that resistance failed and turned into support, and we still have those volumes that were traded there. So, when the price drops to this level, it is likely that the buyers from this volume cluster will become active and push the price upwards from there again.
What adds strength to the level is that it was a resistance level in the past and has now turned into support. That is a price action confirmation. Another price action confirmation is this huge Fair Value Gap.
Again, as in the previous example, this one begins here. It is a bullish Fair Value Gap, so that’s why it begins here, and it nicely aligns with the volume cluster we have here. Right? So, all the setups nicely align and point to this level. That’s why I think there will be a reaction and why I want to trade this. Okay?
So, that’s the Trend Setup, a setup that I trade when there is a trend. Now, let’s take a look at USD/CAD.
On USD/CAD, I want to talk about a resistance level that is here, at 1.4091. This one is based on the fact that if you look at this area with Volume Profile, you can see that there were heavy volumes traded inside this little rotation. Afterwards, a strong sell-off started from that rotation.
That means sellers were accumulating their short positions, and then they pushed the price downwards. They manipulated the market. So, we have this heavy volume zone where we know that sellers were active. If the price makes a pullback to this level, I believe that those sellers will become active again and will want to push the price downwards. Right? So, that’s the main logic behind this short level.
This setup is called the Volume Accumulation Setup because sellers were accumulating their short positions here before pushing the price downwards. The level is at the beginning of that heavy volume zone. However, it is not only there. It is also at the beginning of this bearish Fair Value Gap.
See, this is the Fair Value Gap. Because this is a bearish Fair Value Gap, it begins here. This is the beginning of the Fair Value Gap, and that’s a place I like to trade from. So, again, we have this little confluence between the Volume Profile level and the beginning of the Fair Value Gap.
Now, I’m just waiting for the pullback. When the price hits this level, I’m going to enter a short trade from there. Right?
If you guys are interested in learning more about Volume Profile trading, and if you want to learn my whole strategy from A to Z and get your hands on my custom-made Volume Profile and other indicators, you should visit my website. It is trader-dale.com. If you click the button that says “Trading Course and Tools” it will bring you to a page where you can browse all that stuff.
All right, so that’s it for today. Thanks for watching the video, and I’ll see you next time. Until then, happy trading.
Now, before I wrap the video up, I’d like to announce the winner of the contest we held last time. The prize in the contest was my custom-made Volume Profile and VWAP indicators for the TradingView platform. Right now, on your screen, you can see the name of the person who won the contest. So, congratulations to the winner.
Next, I’ll run another contest for the coming 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 it. Thanks for watching the video. I’m looking forward to seeing you next time. Until then, happy trading.
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