that's my local office, silly.
google earth my domain name address, get my office.
seriously,
surf
Why do people use Volume, Range and Tic charts?
- Thread starter fearless9
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that's my local office, silly.
google earth my domain name address, get my office.
seriously,
surf
Might as well try and revive this thread since I have a question...
I have been using volume bars for some time as I found that the price action looked 'smoother' or cleaner than with time bars. However, I realized a potential problem the other day: it's essentially impossible to make use of sloping S/R trendlines when using volume bars, because a volume chart moves to the right at a variable rate. Therefore, a trendline may be well-defined on a time chart but invisible or poorly-defined on a volume chart.
This actually seems to bring up a whole category of issues with exotic bar types. I assume, perhaps incorrectly, that the vast majority (75-80%) of traders use constant time bars. If your job as a trader is to predict what the crowd will do when situation X arises on the chart - for example, that sellers will step in when the price hits a trendline - it would say it's important that you're seeing the same picture as everyone else.
I suppose that with experience you could look at a volume chart and see a different picture than the rest of the crowd, but one that gives you the same information - if that makes any sense. Either way, I'd love to hear from people with experience using volume charts or perspective on this issue...
I have been using volume bars for some time as I found that the price action looked 'smoother' or cleaner than with time bars. However, I realized a potential problem the other day: it's essentially impossible to make use of sloping S/R trendlines when using volume bars, because a volume chart moves to the right at a variable rate. Therefore, a trendline may be well-defined on a time chart but invisible or poorly-defined on a volume chart.
This actually seems to bring up a whole category of issues with exotic bar types. I assume, perhaps incorrectly, that the vast majority (75-80%) of traders use constant time bars. If your job as a trader is to predict what the crowd will do when situation X arises on the chart - for example, that sellers will step in when the price hits a trendline - it would say it's important that you're seeing the same picture as everyone else.
I suppose that with experience you could look at a volume chart and see a different picture than the rest of the crowd, but one that gives you the same information - if that makes any sense. Either way, I'd love to hear from people with experience using volume charts or perspective on this issue...
First, volume bars are smoother and cleaner. The reason for that is they aren't created based on the variable aspect of price movement viewed by time based bars.
Sloping trendlines are the problem not the volume bars. There are more accurate ways of defining trends on charts that are variable based than trendlines. We have decussed this in detail eariler in this thread.
I agree that approximately 70-80% of the traders out there use either time or tick bars. Now on to your next statement, I prefer to see things clearer than the herd not see WHAT the herd sees. Get my point? You stated that volume bars are smoother and clearer. There is a purpose for that.
CVB Charts (Constant Volume Bar) aren't exotic, they're charts containing the ability to see price movement with less noise and that is always an advantage.
IMHO . . . Range bars 3 steps backward not forward.
Example: What is the range of the eMini S&P going to be tomorrow, in the first hour or in the opening 5 minutes.
Range bars are for breakout traders and we have all seen how a breakout is easily exhausted time and time again. I'm not saying they don't have their place but the purpose of viewing price is to view it with as much clarity as possible not add more inconsistency and noise into how we view price.
This isn't true and comes from lack of knowledge and familarity with using them.
Don't believe me?
Put in the time and start working with them ... I think you'll find that they are very easy to use, once you get some basic knowledge down.
Jimmy one of my students helped invent them, though MacRae gets all of the credit. Mittalo was trying to get Ensign to add them 18 months before MacRae published them.
I completely understand them. A new bar does not start until a price tick is received that would exceed the fixed (user defined)range of the current bar. That and the 'phantom bars' are just that. There is NO need to add noise into an already noisey environment.
Just a little thing that caught my eye, Prof. and it just may be semantics, but, doesn't the fact that volume doesn't close at 2 million contracts (or whatever number you wish just as long as it's the same) everyday, throw a bit of skew into the contracts per bar stable/non-varying evironment?
If this was brought up before then disregard, as I only read the first few and last pages of this thread. Good one, it is.
I know the individual bars aren't about volume per day. But won't the overall volume differential (per day) have an effect on... umm...nevermind.
Smoothing out the bars is one thing, reading the market with a static against a liquid just throws me a bit. The words stable and non-varying remind me of my x-wife... things that she definitely is not. But like I said, semantics. Cheers.
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