The Fifth €l€ment
- CHI-The price:
As we all know the price discount all informations.
Think about the power of a computer chip understanding only 0 & 1.
You can read and understand 0 1 2 3 4 5 6 7 8 9 , correct ?
Endless power and possibility you have ...!
- KA-The Volume:
To avoid trading charts looking like a plat of spaguetti, One MUST find a good indicator.
The Volume is really the second purest information afther price behavior.
They are many types of software around VSA types etc ....; i urge you to look at the latest data feed of volume.
In the good al days of voice broker when you where at your desk you could listen to the market...hear the trend !
The Last price is not = to bid or ask !
You need to know if last = payed or given ! not same thing !
Now seems we can get volume data of ask and bid Not equal to volume or ticks volume !
Its a MUST have.
here example of different type of volume data
- 1 = Bid/Ask (Ask for up, Bid for Down)
- 2 = Uptick/DownTick Volume
- 3 = Bid/Ask Number of Trades
- 4 = Ask/Bid Difference Max
- 5 = Ask/Bid Difference Min
- 6 = Bid vs Ask (see notes below)
- 7 = Total Volume
- FU-Time frame or Range bar
They are lots of advice all around some of then urge to use range bar to get a cleaner chart.....NO spaguetti .. again
example: a range bar of x pips or vol takes y seconds to be builded
The more you know the less you can do .....
The other way around to get a range bar with a time chart is by simply cleaning all data with the range of the same bar.
example time bar of 5 minutes ; volume = x / y=range
same output = compression data
small candles with exceptionally high compression are interesting and useful
exceptional compression highlights trading activity 'hiding' in smaller candles
when the pressure blows out the price will move away on larger 'low compression' candles
- SUI-Have a Plan:
You Need to have a plan to realise your dream...!
Very precise plan to avoid any EGO very Bad Trip.......!
Example of a survivor plan from emini just need to go into the details.....
Target a small daily profit … Stop over-trading
Use fewer price indicators … Stop using multiple correlated indicators
Focus on less … Stop information overload
Give your trades room to work … Stop using tight stops
Use a higher timeframe to determine trend … Stop using just one timeframe
Do what other people can’t … Stop thinking like the crowd
Think in terms of cyclical & trending phases … Stop expecting a trend move
Enter on a test of the trend … Stop chasing or fighting the trend
Track your mistakes … Stop repeating common errors
Its time to analyse yourself now....!
WHY TRADING ?
What will make you happy ?
1000 pips ? EGO trip ? Bit the market ? Margin call ?
Is your plan precise enough and ok with that objective ?
REALISE and E N J O Y ........... !