how do you recognise when volatility is dead?

Appears to me you've never really traded. Why would I say such a thing? ...Call it a gut feeling...

You said you were in France, and you said you use moving average. I was wondering if you ever use two (2) moving averages? Some traders use two (or more) MAs to help them identify a trend.

I was also wondering if you have ever seen a "French Braid" on any of those gorgeous babes wandering around your neighborhood?

If you know what a French braid looks like and you use two or more MAs. Then you have one of the best indicators to identify ranging price action. If you see "6 hours" of multiple moving averages that look like a French braid winding horizontally across your chart, I'll bet the "market is dead".

Another great indicator I use is a CLOCK, here's a link to help you set one of your watches to New York time and another to Chicago time.

http://wwp.greenwichmeantime.com/

This link (below) may be helpful informing you when to set your alarm clock(s) to the sessions you may want to trade. If you click around on this site you may find a forex economic calendar which may also explain why volatility has decreased, in anticipation of a release.

http://www.fx360.com/commentary/kathy/3650/fx-knowing-when-to-trade.aspx

You also said you didn't "want" to scalp in a ranging market. That's why I get up in the middle of the night (US) to trade the European markets. It might behoove you to adjust your schedule if you are serious about trading.

However, as it happened the "day" you started this thread I got up a little late for the European market. The session was filled with economic data releases. I took 2 signals that went nowhere and was down after a few hours. I don't like scalping either but I can do it. By reading a shorter time frame chart I was able to get ahead within an hour. I've been trading a long time and when the market broke to the downside I had a price where I wanted to enter short. When prices traded near my entry price I jumped in..... I haven't made a trading error for awhile and I guess my time was up,,, I clicked buy instead of sell in a breaking market!!!! When I saw red when the market fell (a few points thank God) I doubled up and covered. I thought,,,, good,,, I only lost 6 points. To make make matters worst when I enter a position I have a target and stop in place and hold on for the ride.... As prices fell and my paper profits started to add up I realized,,,, since I entered by doubling my stop I didn't have a target or stop in the market!!!!! I dumped the trade and made myself another latte'. Of course the market fell another 10 points WITHOUT me. I went short again because I had a reason the 6E would trade under 2600. The market started to drift away and I ended up giving back 1/2 of what I just made!!! Fortunately I was able to refer back to the shorter time frame chart and scalp 2 trades and recoup my loss.

The Forex whores tout the phrase " trade 24 hours 5 days a week" that's true but WINNING is another matter. Scalping may be the only game in play while waiting for a report or after a decent move. When I (have to) scalp the trendless dead times (I call it the forbidden zone) I keep my size at 2 contracts... Fills are "all over the map" and the skid will kill!!!

Your thread title "How do you recognize when volatility is dead?" You said you use B/bands, that's a good one. I can't help to think your efforts may be more productive if focused toward volume. Rather than the deviation of low volume price movements. I have a simple indicator I programed that "lights up" when (x) amount of volume per bar comes into the market (or leaves).

I'll close by restating my opening line. Figure out what's going on here.... The guys that make the money in this business are out to pick your pocket clean... and they will... every time.. Until I realized I had no idea who I was trying to take money from and how I was going to do it I was a LOSER.

<*)))><
 
Quote from Went Fishing:

Appears to me you've never really traded. Why would I say such a thing? ...Call it a gut feeling...

You said you were in France, and you said you use moving average. I was wondering if you ever use two (2) moving averages? Some traders use two (or more) MAs to help them identify a trend.

I was also wondering if you have ever seen a "French Braid" on any of those gorgeous babes wandering around your neighborhood?

If you know what a French braid looks like and you use two or more MAs. Then you have one of the best indicators to identify ranging price action. If you see "6 hours" of multiple moving averages that look like a French braid winding horizontally across your chart, I'll bet the "market is dead".

Another great indicator I use is a CLOCK, here's a link to help you set one of your watches to New York time and another to Chicago time.

http://wwp.greenwichmeantime.com/

This link (below) may be helpful informing you when to set your alarm clock(s) to the sessions you may want to trade. If you click around on this site you may find a forex economic calendar which may also explain why volatility has decreased, in anticipation of a release.

http://www.fx360.com/commentary/kathy/3650/fx-knowing-when-to-trade.aspx

You also said you didn't "want" to scalp in a ranging market. That's why I get up in the middle of the night (US) to trade the European markets. It might behoove you to adjust your schedule if you are serious about trading.

However, as it happened the "day" you started this thread I got up a little late for the European market. The session was filled with economic data releases. I took 2 signals that went nowhere and was down after a few hours. I don't like scalping either but I can do it. By reading a shorter time frame chart I was able to get ahead within an hour. I've been trading a long time and when the market broke to the downside I had a price where I wanted to enter short. When prices traded near my entry price I jumped in..... I haven't made a trading error for awhile and I guess my time was up,,, I clicked buy instead of sell in a breaking market!!!! When I saw red when the market fell (a few points thank God) I doubled up and covered. I thought,,,, good,,, I only lost 6 points. To make make matters worst when I enter a position I have a target and stop in place and hold on for the ride.... As prices fell and my paper profits started to add up I realized,,,, since I entered by doubling my stop I didn't have a target or stop in the market!!!!! I dumped the trade and made myself another latte'. Of course the market fell another 10 points WITHOUT me. I went short again because I had a reason the 6E would trade under 2600. The market started to drift away and I ended up giving back 1/2 of what I just made!!! Fortunately I was able to refer back to the shorter time frame chart and scalp 2 trades and recoup my loss.

The Forex whores tout the phrase " trade 24 hours 5 days a week" that's true but WINNING is another matter. Scalping may be the only game in play while waiting for a report or after a decent move. When I (have to) scalp the trendless dead times (I call it the forbidden zone) I keep my size at 2 contracts... Fills are "all over the map" and the skid will kill!!!

Your thread title "How do you recognize when volatility is dead?" You said you use B/bands, that's a good one. I can't help to think your efforts may be more productive if focused toward volume. Rather than the deviation of low volume price movements. I have a simple indicator I programed that "lights up" when (x) amount of volume per bar comes into the market (or leaves).

I'll close by restating my opening line. Figure out what's going on here.... The guys that make the money in this business are out to pick your pocket clean... and they will... every time.. Until I realized I had no idea who I was trying to take money from and how I was going to do it I was a LOSER.

<*)))><
More...

thanks for the info but no need to talk with this condescending tone.

I never said that I was a pro. I am still learning. That is why i am asking questions. it is the aim of this thread.

so keep your " you've never really traded" for yourself.

thanks.
 
For me, volatility-is-dead is simply looking at the chart, seeing a price chop around in a very narrow range. That tells me to stay out of the market.

Look at the ES between 1130 and 1330 on most days, or the ES in the mornings prior to FOMC meetings to see what I mean. If the ES only moves in a 1-3 point range for 2 hours, that's telling me vol is dead.
 
As mentioned earlier by circadian, ATR (average true range) might be useful to you. But it is an indicator therefore inherently after the fact, not predictive. Apply it to a fast timeframe or better still, include it as a parameter into a custom calculation.
 
Quote from mounafia:

...So I would like to know if there is any indicator other than the BB that would allow me to see faster that the market is dead.

I don’t want to learn to scalp when the market is ranging in 15 pips (I tried and I am just not good at it…too stress). I just want to be able to see it fast and avoid this kind of market.

Any advice? Any tools I can use? How do you know when it is time to stop trading because the market is going nowhere? How do you recognise day to avoid?

Thanks in advance
More...

* Use the times shown on a Forex Calendar

* Keep track of opening and closing times of the world's key markets

* Learn about contraction/expansion analysis. Simply, if you see the range getting narrow, intervals getting smaller along with getting bored...set some price alerts (loud audio) outside the range and then go read a book or any personal stuff around the house that's not related to trading.

Mark
 
mounafia

Thanks for the personal response to my post. Let's call the first line a bad trade and move on, can you do that? If so, when it's 7am in New York it's 1pm in Gay Paree, yes? That's the same as Frankfurt, an hour later than London? Let's also assume US dead zone starts at 2pm Est that's 8pm Paris. If you have a day job I see your dilemma, trying to find market volatility & volume when YOU'RE available to trade. Things do happen in forex when New Zealand & Australia open but you probably learned that lesson already. The Asian market I find is like watching a tree grow (most of the time).

Honestly I don't know what I'd do if I were in your moccasins. Maybe, maybe, maybe You could shift your focus to position trading. Study longer term price action (charts) and take a position and hold it for 12 hours, or have it filled and closed out between 8am to 8pm your time. I've often thought a guy might get very good at buying & selling the 80's & 20's. With some serious thought and a lot of testing you may come up with an automated system that answers your riddle.

Good luck, in whatever you pursue.
<*)))><
 
Quote from mounafia:

I usually lose money when the market range.

I don’t want to learn to scalp when the market is ranging in 15 pips (I tried and I am just not good at it…too stress). I just want to be able to see it fast and avoid this kind of market.

Any advice? Any tools I can use? How do you know when it is time to stop trading because the market is going nowhere? How do you recognise day to avoid?
More...

There is no magic way to do it... some suggestions:

1) Keep in mind which periods tend to have more volume/movement and which have less. E.g. mornings vs. lunchtime vs. afternoon vs. late afternoon. Action tends to get slower on Friday afternoons, around holidays/seasonal slow periods, and in advance of major information releases. Currencies in particular are sensitive to moves in international stock/commodities markets, when these markets are closed or going nowhere the moves in currencies will usually be more subdued.

2) Get in the rhythm of the market: are we currently in a period of overall high volatility or low volatility (compare now to Mar/Apr)? Have we recently completed a big move, making it more likely to chop/range? Have we been ranging for some time, making a breakout/volatility expansion more likely? Are there any significant PA developments (break of significant pattern or S/R, for example) that might induce more activity?
 
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