You are using an out of date browser. It may not display this or other websites correctly.
You should upgrade or use an alternative browser.
You should upgrade or use an alternative browser.
anyone using volume indiactor for intraday trading
- Thread starter hermit_trader
- Start date
Quote from Trader273:
There is a formula on Tradestation's forum, that will give you an approximation of what what the volume bars equal in time. ( example, 1200 volume bars would equal about a 3 min chart.) Ill look later to see if I can find it.
Be careful trying to adjust VBC's (Volume Bar Charts) to time. Time is irrelevant to you but time is is irrelevant to the markets when using VBC's. As you know from applying VBC's to the Futures market, each market is slightly different as far as the size of the VBC for Intraday, Swing or Position trading.
VBC's eliminate a great deal of noise from price charts but they should be built accurately. Tradestation isn't consistent in they way they build them though.
Example: Lets say you have designated your chart as a 1200 VBC and the current bar already contains 1150 contracts and the next transaction (tick) consists of a 200 contract order. Tradestation will tack all 200 contracts onto the current bar making it a 1350 volume bar instead of the 1200 volume bar you designated. Tradestation should tack 50 contracts onto the previous bar and start a new bar with the remaining 150 contracts. Tradestation refuses to add the feature to "CAP" each bar to the exact user designated amount. It isn't that this is hard to do because Ensign and MultiCharts have done it successfully for a few years. If you can program in Easy Language or know someone that can, you can create a fix too.
VBC's eliminate the noise by eliminating the variable aspect of price movement. Time charts are the worst for noise. Tick charts are an improvement but only slightly. If consistent, VBC's are perfect because each bar is exactly the same size. The only variable is the range in price of those bars which is the very aspect that makes them perfectly readable.
Quote from ProfLogic:
Be careful trying to adjust VBC's (Volume Bar Charts) to time.
I couldn't find what I was looking for on the TS forums, but the idea is that for comparative purposes. If I'm used to using a 3-minute chart, I'm not going to want to use a volume chart that looks more like a 20 minute chart. I am in no way advocating using a formula to duplicate a "x" minute chart with "X" volume bars. What would be the point of that? So basically I used the formula as more of a guide than anything else.
Quote from Trader273:
I couldn't find what I was looking for on the TS forums, but the idea is that for comparative purposes. If I'm used to using a 3-minute chart, I'm not going to want to use a volume chart that looks more like a 20 minute chart. I am in no way advocating using a formula to duplicate a "x" minute chart with "X" volume bars. What would be the point of that? So basically I used the formula as more of a guide than anything else.
I understand.
A "3 minute" chart is made up of 130 "3" minute bars between 9:30 am EST and 4:00 pm EST. This being the case, find the average daily volume of a particular market and divide by 130. This will give you the average VBC you want.
I go about it a little differently. I build my charts where each chart is "7" times faster than the next one. This gives me complete control over watching each market in a sequential intervals.
Example: 7 vbc, 49 vbc, 343 vbc, 2401 vbc, 16807 vbc, 117649 vbc & 823543 vbc. For the QQQ's and stocks that trade with more volume I even go further out than this. Build the charts and "SEE" which chart fits your style of trading.