Price driven charts - Do you adjust settings based on changes in volatility?

[Laissez Faire]

Hi all,

With the recent increase in volatility, I'm curious if those of you using tick/volume/range and other types of charts not based on time are adjusting your settings or if you use the same settings regardless of volatility?

 

[tommcginnis]

Yes.



(Which is to say, for a 1min-candle/4hr chart, used to be 30-40 S&P pts. 20pts. Then 30pts. Nope! Back to 20pts. Calendar-2018??? 40pts-50pts is not uncommon. )

I think it depends, too, on your use. As a tick-scalper, individual candles need to demonstrate different behavior than a spread-writer needs to see....

 

[Xela]

Do you adjust settings based on changes in volatility?

My charting software does that for me automatically, kind of ... but if it didn't, my answer would certainly be "yes".

 

[qxr1011]

same setting

 

[Laissez Faire]

My charting software does that for me automatically, kind of ... but if it didn't, my answer would certainly be "yes".

How so, may I ask? What charting software do you use?

If it's a secret or proprietary, I certainly understand.

I'm still experimenting with these types of charts, but to me it makes sense to not use a fixed setting.

 

[Ayn Rand]

A fundamental of market analysis is ceteris paribus. If something changes you have to account for it.

Your question is just an example of the many questions on this forum that do not fully address how you trade and what you are using the information for. With more detail you can expect a more detailed answer.

It is unclear to me how tick, volume, and range are not related to time?

This is a secret. Current trading is statistically significantly different from trading only a month or so ago.

Tell more - get more

 

[Xela]

If it's a secret or proprietary, I certainly understand.

With apologies, it is proprietary, and I shouldn't describe it ... (I maybe shouldn't have posted, really, for precisely that reason - sorry).

to me it makes sense to not use a fixed setting.

To me, also (at least, not a fixed time-setting, anyway). But that's just a preference: I don't doubt that there are also people making their livings perfectly satisfactorily by using only fixed settings.

 

[speedo]

Yes, I use tick charts and halved my settings for my three tf's recently.

 

[happyscalpie]

we are continuously auctioning with one another. it make sense to view the 'continuous' movement of ticks. the most info is found in a 1 tick chart, however not practical to screen estate. the next best is to aggregate these ticks into an 'actionable' time window for yourself. eg I daytrade, approxing an 'x' no. of ticks that would make each tick bar approx 1min. it is of course better than using M1 bars, esp during news releases. such a tick bar setting will allow me opportunuities to find trades in a daytrade timeframe

when volatility gets high, adjust the ticks per bar to a lower setting, so you can better see the auction process, which you might otherwise miss, sticking to your old pre-volatile 1000 volume bars for eg. in a high vol enviro, my old 1000V setting will misses alot of the increased auction activity

Xela's auto set ticks is interesting. not v difficult to think of & do if you want to save some time everyday. prob just adjust your tick settings everyday, based on a rolling timeframe, which is highly dependent on yourself

 

[Laissez Faire]

Anyone interested in sharing settings or how you use tick charts?

Since some user wanted more information on how I want to use these charts my purpose is day trading (ES).

Beyond higher time frames, my current main chart is the 1-minute and the 5-minute chart, but lately even the one minute chart seems 'too slow' and does not always give an accurate picture of the action.

Tick/volume/range bar charts are more sensitive to actual price action and trading, so they might give a better representation of what's going on currently.

I have spent most of my time on other stuff lately, but I'm ready to do some more studies on charts in the coming weeks.

FWIW, I have done quite a bit of experimentation with all three charts mentioned above, but I have yet to find a significant edge over time based charts. If the 1-minute chart is too slow and one wants to read greater detail, can one not simply use for example 30-second charts or even less?

Price driven charts can of course smooth the price action, but is that necessarily of value? Out of the three, I liked range bars the least.

More study is needed...

PS: I assume most people using price driven charts are day traders anyway.