Johnny Rock's $100,000 Challenge

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  1. Check out the 3rd chart
  2. Double tops don't matter until previous support becomes resistance.
  3. Then a series of lower lows and lower highs were printed.
https://futures.tradingcharts.com/historical/ND/2000/0/continuous.html
 
My thoughts on tape reading and volume:

  1. There are two types that seem to work in my favor. (I am not an expert.)
  2. Inflection points (key levels like a swing H/L, YH, YL) and how the market reacts at those levels offer a glimpse into what is going on.
  3. Did the market sell off fast breaking support? Does the market seem to be pausing after the plunge? Even if both events happen consecutively what I am interested in is volume first drying up, and then price reversing on an uptick in the pace of the buying. In this scenario, traders are probably trapped.
  4. Using volume in my analysis can be frustrating, but this often works. Until it doesn't. If I am already short/long and the market is moving in my direction, I will try to exit into expansion bars on high volume. Many times that is practically the low/high for a swing move. Other times, the market continues on without me, but I don't know how to "recognize" those events in real time. This may be specific to me, but I often "feel" elated too. Although this is anecdotal, it seems like when I have that feeling, a pullback, or more, is coming.
So to sum it up, inflection points and the pace of bid/ask is vital. Exiting into a strong move on volume, in my favor, is almost always the best bet.
 
  • Check out the volume on these two charts.
    resistance became support - heavy volume.png
    volume drying up.png
The mechanics of what I am attempting to do hasn't changed. However, I have been experimenting with different layouts to see which one gives me the information I need in the simplest form.

The Keltner bands (20 with a deviation of 2.0 to signal either a trend trade or rubber band trade if it sets up), the DMI (not necessarily used in the same way as others, because I m prepared to fade a strong move at an inflection point if it fails) and the volume histogram seem to paint a picture of volatility, momentum and S/R levels (inflection points).

I can't imagine I trade off the one minute chart, so this is just for illustrative purposes.

So far I like it!
 
johnnyrock said:
The mechanics of what I am attempting to do hasn't changed. However, I have been experimenting with different layouts to see which one gives me the information I need in the simplest form.

The Keltner bands (20 with a deviation of 2.0 to signal either a trend trade or rubber band trade if it sets up), the DMI (not necessarily used in the same way as others, because I m prepared to fade a strong move at an inflection point if it fails) and the volume histogram seem to paint a picture of volatility, momentum and S/R levels (inflection points).

I can't imagine I trade off the one minute chart, so this is just for illustrative purposes.

So far I like it!
More...
Lifted from barchart.com.

Theory:

The Price-Volume Histogram (PVH) plots the number of shares or contracts traded at different price levels over a user-defined span of days. The PVH provides a clear picture of short-term support and resistance levels based on volume. In addition, the PVH graphically identifies price levels where the majority of trading activity has occurred, as well as price levels at which no trading occurred.


Interpretation:

A quick analysis of PVH reveals where an execution is likely and also where it may be difficult to do business. In this sense, the PVH provides an indication of liquidity at various price levels.
 
Buying WEAT and averaging up monthly ($200/month).
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weat-weekly.png


I first learned of this cycle from Weinstein. It looks like WEAT has entered stage 2 of the market cycle. This is a long term trade and I will update when I close it.
 
johnnyrock said:
The mechanics of what I am attempting to do hasn't changed. However, I have been experimenting with different layouts to see which one gives me the information I need in the simplest form.

The Keltner bands (20 with a deviation of 2.0 to signal either a trend trade or rubber band trade if it sets up), the DMI (not necessarily used in the same way as others, because I m prepared to fade a strong move at an inflection point if it fails) and the volume histogram seem to paint a picture of volatility, momentum and S/R levels (inflection points).

I can't imagine I trade off the one minute chart, so this is just for illustrative purposes.

So far I like it!
More...
Volume histogram introduction:

 
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