Let me explain my workspace layout that appears on page 2 of this thread. Starting from the top left hand corner and going clockwise, I have the following charts:
1. Standard 60 minute candle chart.
2. Volume candle chart.
3. 5 min candle chart â this is my main chart.
4. 100 tick footprint.
5. 1 min footprint.
6. Market Profile (minimised).
7. Daily candle chart (minimised).
60 min chart
I usually have a regression line with a 2 standard deviation channel on this chart. Helps me identify the primary trend and where we are in proceedings. The black indicator is the TSI(20,5) â used for OB/OS and momentum divergences. You can see a good long signal on Tue with price outside the channel and TSO oversold.
Volume candles
I like volume bars a lot - a lot less noise then time based charts. I use this chart for assessing which side of the market is better facilitating trade. The relative length of the candle body is all important. I also have zig zag labels on this chart. I set the min price according to my standard pullback entry plus stop distance (5+5=10 in this case). I like to trade pullbacks in trending markets. If the market is trending and Iâm not getting zig zag labels then I should be trading pullbacks.
The blue connected line below is a volume breakdown (accum all value, trades > 25 lots). Essentially it is running total of the delta for large lot trades. This is extremely useful and I will talk at length about this in another post.
5 min chart
On my main chart I have all my important levels. Yesterdays VA, the developing VA (called the TPO indicator), the composite POC (if applicable), the Initial Balance, yesterdays HOD/LOD, plus levels from my volume profile. This chart can get a bit busy but my levels are crucial to how I trade. I have a TSI beneath that â again Iâm looking for O/OS conditions and especially divergences.
And below the TSI is 3 VBâs. The top one is a straight forward delta bars, without any filter. The second is a three period least squared average of trades > 10 lots. The third is the same for trades < 11 lots. I use the same filter sizes on all markets â after much experimenting. I use these 3 VBâs extensively. This particular day is not a good example but I will discuss how I use them in some detail in a later post.
100 tick and 1 min footprint
I like to keep my footprint charts real simple. Just the volume histogram and delta footprints. I spend a lot of time monitoring the tick footprint â it gives me a good feel for the action. The #trades (ticks) varies from market to market â but I set it so I get a max of 4-5 prices per bar. I also use manual shading of the footprints. In this case I have them set to 100, 500 and 800. I use the 1 min footprint to time entries and exits. Iâve been experimenting with using the little histograms lately. MidKnight pointed out some interesting properties that Iâll ask him explain. Weâll talk more about using the footprints.
Youâll also notice little clocks on three of the charts. These are countdown timers. Very useful for assessing how long before the bar completes.
The next few posts I'll go into some detail about the VBs and the footprints.
bolter
