Day trading stocks with confidence with Anna Coulling and using volume price analysis

Day trading stocks with confidence with Anna Coulling and using volume price analysis.

00:00

Introduction and market overview

00:00

The session begins with a welcome and an informal discussion about the weather, highlighting how people often complain regardless of conditions. The presenter thanks attendees for their patience and participation despite a slight delay. The focus of the webinar is introduced as an analysis of US market futures and stocks, covering recent developments, current status, and future outlook. A trading disclaimer is emphasized, warning about the risks involved and advising not to trade with money one cannot afford to lose. The presenter acknowledges the diverse audience, including forex trading students and quantum users, and invites newcomers to introduce themselves.

01:26

Volume Price Analysis (VPA) concepts

01:26

The speaker introduces the focus on U.S. markets and explains that they will analyze charts using volume price analysis (VPA), which studies the relationship between price action and volume. They mention a book available on Amazon that details these concepts, along with a companion book containing about 200 worked examples from commodities, indices, and stocks across various time frames. The key idea is that chart patterns and anomalies repeat frequently, making it easier to recognize and predict market behavior.

02:40

The speaker emphasizes that pattern repetition happens across all time frames in VPA and references a schematic illustrating the interplay of volume, price, candles, support, and resistance. They explain that support and resistance levels provide chart structure, indicating potential price pauses or reversals. Confirmation of these movements comes from volume and price action combined with candle patterns. By blending these elements, traders can make informed decisions to enter, hold, or exit trades.

03:48

Traders can enhance their charts by adding various indicators, including proprietary ones designed to reflect VPA concepts. The speaker highlights the importance of considering time, both in the timeframe traded and across multiple timeframes. Additionally, they mention the use of non-time-based charts, such as Renko charts, which are integrated alongside traditional time-based charts to provide a more comprehensive analysis.

04:25

US housing data and economic impact

04:25

The speaker discusses the importance of combining time charts with fundamental data to identify potential market entries and exits. They recap the recent housing data released on Tuesday, noting that building permits are substantially lower while housing starts are higher. Housing data serves as a key economic indicator, reflecting broader economic health despite past market crashes like in 2008. The housing market in the US and UK shows similarities, including a shortage of desirable homes, which drives prices up and influences related stocks and ETFs. The speaker emphasizes the value of understanding daily data releases and integrating them with chart analysis. They also mention using the free version of Financial Juice for live news and economic calendars, which meets their needs without requiring paid subscriptions.

06:42

Market sentiment and recent volatility

06:42

The market experienced a dramatic sell-off recently due to concerns about the virus spreading again, impacting economic growth and reopening plans. However, there was a strong rebound with the Dow surging 400 points. The market stabilized overnight and into the morning, entering a quieter summer period with lower trading volumes. The current environment is characterized by cautious gains as the market moves toward new highs, but there remains the risk of sudden sell-offs triggered by new catalysts.

07:45

Market volatility is expected to continue, with potential sharp corrections triggered by unexpected events. Investors should watch trading volumes closely to determine if dips are buying opportunities or the start of a bigger sell-off. Although a major downturn is possible, the current market structure suggests this recent sell-off is not the beginning of a significant bear market. Understanding chart patterns can help prevent fear-driven decisions that harm investment success.

08:56

Futures have recovered somewhat after a steep drop, with the Dow futures up 20 points and the S&P 500 rising 34 points. The VIX volatility index has decreased slightly but remains elevated following the recent market turmoil. Other financial instruments and markets are still stabilizing after the sharp moves, which is typical after such events. Overall, the recent market activity has created good trading opportunities, especially for day traders.

10:00

The market rebound continues with the Dow up 400 points, though the Nasdaq’s recovery is more modest due to a smaller previous decline. The Russell 2000 index, representing more speculative stocks, experienced significant drops but is now showing strong buying interest, indicating improving market sentiment and risk appetite. This positive mood sets the context for further stock analysis and investment considerations.

11:10

Market internals and breadth indicators

11:10

The speaker explains the importance of market internals, which provide a statistical view of what is happening within stock indices beyond just price movements. One key metric discussed is advances and decliners, which helps traders understand if a market move is genuinely supported by a broad base of stocks or just a few pushing the index. For example, only 60% of S&P 500 stocks being above their 50-day moving average indicates a divergence, suggesting the index’s rise lacks full support. This can signal caution as the market may be vulnerable to reversal despite appearing strong.

13:22

The speaker recommends visiting the website Sentiment Trader, which offers both free and paid services to track market sentiment and internals. The free email service provides valuable insights into market breadth and sentiment, helping traders understand underlying market conditions. The blog and data on advances and decliners can reveal disparities between what is seen on price charts and the actual market internals. Traders are advised to trade based on what they see but to use volume price analysis (VPA) and sentiment data to gain confidence in their decisions. The segment ends with an invitation for viewers to ask questions about stock screening tools and market analysis platforms.

15:35

Stock screening and sector performance

15:35

The speaker discusses discovering a useful bar chart tool that lists sector performances over the past five days, highlighting a generally negative trend. The tool allows filtering by sector and displays the number of stocks within each sector. For example, the hotels and motels sector has 15 stocks, which can be individually examined for performance.

16:47

Within sectors, although overall performance may be down, some stocks show recovery. The speaker emphasizes the importance of volume when assessing stock moves, noting that stocks with rising prices but low volume may not be experiencing genuine trends. They also mention tools for filtering the top and bottom 100 stocks, highlighting the usefulness of these filters for trading decisions.

17:57

The presenter refers to mimistocks.org to observe where retail and Wall Street investors are focusing. Popular stocks include Nvidia, General Motors, Amazon, and others like AMC and Blackberry. The number of mentions of these stocks has declined compared to a few weeks ago, suggesting retail investors are moving away from highly volatile stocks that previously attracted significant attention.

19:11

The speaker reviews previous stock picks, such as Brooklyn Immunotherapy Therapeutics, which experienced extreme volatility from near zero to eighty dollars. They note some trapped investors during price peaks and express frustration with chart access issues. The speaker considers subscribing to MarketBeat for its useful features and to better track stock movements.

20:30

Despite a poor market day, there was significant buying activity in Brooklyn Immunotherapy Therapeutics, prompting the speaker to monitor it closely. They express an intention to subscribe to MarketBeat due to its valuable insights, although technical difficulties with the chart display persist.

21:04

Bitcoin and stock examples with VPA

21:04

The speaker analyzes Bitcoin’s recent price action using volume price analysis (VPA) indicators on TradingView, highlighting a period of consolidation followed by a significant volume increase. Despite appearances of a strong upward movement, the subsequent decline occurred with low volume, suggesting a pump and dump scenario. The market then entered a consolidation phase with reduced volume, indicating a potential shakeout and accumulation period.

23:11

The upcoming earnings season, particularly for BTX in early August, is expected to significantly influence market direction, either sparking a rally or causing further corrections. The speaker discusses trading platforms popular with retail traders, especially MT5, which offers access to a wide range of stocks and synthetic trading without large deposits. MT5 supports multiple time frames and volume data, making it suitable for VPA. The speaker mentions using multiple charts and platforms like MT5, Ninja, and TradeStation for analysis.

25:25

The speaker reviews a strong trending stock with minor pullbacks, monitored via various charts and volume-based support and resistance levels derived from the volume point of control (VPOC) and Camarilla levels. The price recently reached a critical daily volume resistance level after a gap up, marking an important point for future trading decisions. The segment concludes with the speaker inviting questions and transitioning to another presenter.

27:09

Intraday trading and index divergence

27:09

The speaker begins by sharing their screen and discussing shorting opportunities in the stock market, focusing on three indices: the YM, NQ, and ES. They highlight significant divergence between these indices over the past year and a half. Typically, indices move together, but recently the NQ has rallied strongly while the YM and ES remained flat. This divergence is unusual and noteworthy.

28:18

The speaker notes a shift in divergence with the YM and ES rising strongly while the NQ remains flat. They then describe a strong rally that occurred after the US cash market opened at 2:30 PM UK time, accompanied by a surge in volume. This volume spike is typical at market open and gradually decreases as trading settles into a regular pattern throughout the day.

29:14

The speaker explains that the volume decrease after the initial surge is a natural pattern and not cause for concern. They transition to discussing specific stocks and review multiple time frames on the YM September futures contract, explaining the different contract sizes and recalling how they started trading futures 20 years ago, initially through the London exchange with footsie futures.

30:14

The speaker recounts their early experiences trading futures via phone orders without internet access, describing the stress and delays involved. They then return to current charts showing various time frames from 15 seconds to 15 minutes, noting a recent rally reaching some congestion, which is a normal market occurrence. They emphasize the importance of sentiment in market movements.

31:41

The speaker shifts focus to currency indices, particularly the Japanese yen and the US dollar, viewed on five-minute charts. The yen has been falling, reflecting improving sentiment, with yen pairs recovering after recent weakness. The dollar index is important because a rising dollar could stall the recovery in equities and risk assets, which had been supported by a weakening dollar.

32:38

The speaker warns that a resurgent dollar on an intraday basis could flatten and reverse the current positive sentiment and equity recovery. They emphasize the need for continued yen weakness to support the rally and prepare to discuss specific stocks in response to a prior question.

33:09

Shorting strategies and airline stocks

33:09

The speaker discusses Southwest Airlines as an example of a short stock trade, highlighting recent heavy volume and a gap down in price. They explain that gaps often get filled and emphasize watching volume and intraday price action for potential opportunities. The context includes the airline sector’s weakness and the potential for a short-term intraday long trade despite a longer-term bearish outlook.

34:38

The speaker reflects on the challenges of the airline and travel industries, noting the sector’s current weakness but eventual recovery. They describe their chart analysis approach, which involves quickly scanning thousands of charts for specific price and volume patterns to identify potential shorting opportunities.

35:36

The focus is on identifying key price levels such as volume points of control, resistance, and support to find potential short trade entries. The speaker explains how shorts typically develop faster than longs due to market maker behavior, making short trades attractive. They highlight the importance of breakout patterns and volume analysis in confirming trade setups.

36:54

The speaker elaborates on how channels of support and resistance around volume points of control provide clear trade levels. They discuss volume patterns that indicate whether rallies are sustainable or likely to fail, reinforcing a bearish outlook. The segment emphasizes recognizing breakout opportunities for short trades, especially in a heavily bearish market environment.

38:20

Another airline stock, Alaska Airlines, is used as an example of a good longer-term short trade. The speaker points out strong resistance levels formed after prior support breaks and highlights how volume confirms these levels. They explain the importance of identifying breakaway points where downside momentum accelerates, providing natural protection for stop-loss placement.

39:55

The discussion turns to practical aspects of short selling, including borrowing stocks through brokers and the responsibility for dividends when shorting. The speaker stresses the benefit of well-defined resistance and volume zones for placing stop losses, which protect traders. They also note the overall weakness in the airline sector and the effort required for prices to rebound through strong volume resistance.

41:24

The speaker briefly introduces trading short and long options as an alternative strategy, emphasizing the importance of avoiding naked positions to manage risk. They mention basic options strategies such as buying calls or puts and selling them, highlighting that options can be a more straightforward way to participate in stock movements while controlling exposure.

41:54

Options trading basics and risk

41:54

The speaker explains the basics of options trading, emphasizing that buying puts or calls involves a fixed, known risk limited to the premium paid. They describe covered calls as a low-risk strategy where the trader sells call options while owning the underlying stock, thus avoiding naked positions and the associated risks. The discussion then shifts to analyzing Apple’s recent significant price drop and subsequent intraday trading behavior, noting frequent price gaps and the attempt at a rally.

43:24

Apple stock technical analysis

43:24

The discussion begins by explaining how volume acts similarly to price in terms of support and resistance on a trading chart. Low volume nodes represent areas with little resistance, making it easier for the market to break through these points. Traders should consider volume alongside price to gauge potential market movements.

44:21

Using a 15-minute chart example, the explanation highlights how both price-based and volume-based support and resistance influence trading decisions. Lightweight volume areas, such as between certain price points, indicate that prices can move quickly through these zones with less effort, while higher volume regions suggest stronger resistance.

45:31

The accumulation-distribution indicator is introduced as a tool showing price-based resistance levels, where thicker lines indicate stronger resistance tested multiple times. When multiple resistance levels align, they act together to form stronger barriers. The importance of considering broader market indices and overall bullish or bearish sentiment is emphasized for trading decisions.

46:26

The analysis continues by noting that while individual stocks may not always follow general market trends, index sentiment can provide momentum. Assuming bullish conditions remain, technical indicators suggest it should be relatively easy for a stock to move from one price level to the next. Traders should evaluate upcoming resistance and volume patterns before taking positions.

47:30

The speaker stresses the importance of analyzing charts across multiple time frames, with slower frames carrying more weight. Switching to a 30-minute chart reveals how volume builds as price approaches resistance. Volume nodes and price congestion help identify areas where price movement may slow or struggle, providing a comprehensive intraday trading perspective.

48:32

Further details on resistance levels are provided, showing that price can move easily through some zones but will encounter congestion at higher levels where volume and price resistance cluster. The expected clean trading range is between certain price points, with increased difficulty anticipated beyond those levels. This guides traders on potential price targets and caution zones.

49:30

The segment concludes by reviewing broader market indices, noting the YM index is recovering strongly and nearing previous highs, which supports a bullish outlook. The NQ and ES indices are also recovering, reinforcing the expectation of positive momentum across these markets.

50:08

Currency indices and risk sentiment

50:08

The speaker analyzes currency movements, noting that the yen is falling while the pound is rising strongly and the dollar is attempting a rally. They highlight the Aussie yen as a proxy for risk sentiment, which is rising moderately as expected. Additionally, the speaker discusses using multiple Renko charts across different timeframes (15 seconds, 30 seconds, and 1 minute) as a powerful trading tool favored by many customers for its effectiveness in tracking price movements.

51:16

Renko and non-time-based charts

51:16

The segment explains the calculation of optimal Renko brick sizes for different time intervals, showing how the Renko optimizer automatically adjusts brick size based on market conditions. Examples include 17 points (85 dollars per brick), 27 points, and 38 points across various bricks. The speaker highlights the use of multiple time frames and Renko charts to capture market dynamics, emphasizing that the market has slowed but the system adapts to maintain accuracy.

52:18

This segment discusses the additional features integrated into the Renko charts, such as volume point of control (VPOC), low volume areas, and support and resistance levels. It covers the advantage of Renko charts in showing momentum independently of time, as bricks form only when price moves sufficiently. The speaker compares this with tick charts, noting that both reveal momentum better than traditional time-based charts, which are constrained by fixed intervals.

53:21

The explanation continues with a focus on tick charts, which like Renko, are non-time-based and thus better reveal momentum. The speaker contrasts tick charts with time-based charts, showing how candles on time charts close strictly at set intervals, whereas tick charts build based on transaction volume, providing a clearer view of market activity. The segment also references different tick values running at varied speeds and the need to adjust these settings for optimal analysis.

54:22

Here, the speaker highlights how non-time-based charts such as Renko and tick charts indicate market momentum, supported by a speedometer-like indicator showing whether the market is running slow, average, or fast. The current market is described as sluggish, indicated by red bars. The importance of watching for green bars, signaling increased tick volume and market attention, is stressed. The speaker encourages traders to explore these chart types and mentions the development of specific indicators tailored for non-time-based trading.

55:21

This segment returns to time-based charts, focusing on fast time frames like 15 seconds, one minute, and three minutes, which the speaker favors for anticipating market moves. It explains the volume point of control (VPOC) represented by a yellow dashed line, indicating price agreement and congestion zones. The accumulation distribution indicator helps visualize these channels. The segment concludes with advice on using volume spikes to confirm moves and on placing stop losses effectively based on volume levels and money management rules.

56:20

Holding positions with VPA confidence

56:20

The speaker emphasizes the importance of patience in trading, waiting for the market to clearly break away from a region on any timeframe chart. They explain how to identify a confirmed breakout with good volume, illustrated by a two-bar reversal pattern. The discussion then shifts to analyzing falling price action accompanied by falling volume, indicating weak selling pressure rather than strong selling momentum.

57:08

The speaker highlights that when volume decreases while price falls, it signals weak selling pressure, suggesting it is safe to remain long. This concept is central to Volume Price Analysis (VPA), which focuses on anomalies where price and volume disagree. Whether analyzing single candles or groups, this approach builds confidence to hold positions. The speaker acknowledges the natural fear traders feel when profits pull back, which often leads to premature exits and small losses, ultimately causing trading accounts to decline. They stress the importance of holding onto profitable opportunities despite these fears.

58:34

Commodity updates: oil and gold

58:34

The discussion begins with an explanation of VPA (Volume Price Analysis) as a classical and powerful method that helps traders maintain confidence and analyze charts objectively without being influenced by sentiment or emotion. The focus then shifts to recent commodity market movements, specifically oil, which experienced a significant drop due to fundamental factors rather than technical ones, mainly OPEC’s supply cut decisions. Despite the fall, the market showed expected volatility and volume, indicating potential for either a full reversal or at least consolidation in the near term supported by a strong support platform. The speaker also touches on gold, noting some buying interest and volume, but highlights that gold is struggling to break through resistance levels around 1920 to 2000, with future momentum dependent on the arrival of valid inflation.

01:00:04

The segment continues with further insights on gold’s price action, which rallied with decent volume earlier but is beginning to lose momentum. The potential for gold to benefit from inflation is emphasized as a major factor for future price increases. The conversation then moves to the psychological challenges traders face, particularly fear, and how VPA can help mitigate emotional decisions by encouraging an analytical approach. Using VPA provides a brief but crucial moment to view the chart logically rather than emotionally, improving decision-making. The segment concludes with a brief mention of where to find various trading indicators on platforms like QuantumTrading.com, NinjaTrader, TradingView, and TradeStation.

01:01:38

Trading platforms and indicator tools

01:01:38

The speaker explains that TradeStation comes in two versions: TradeStation 9.5, also known as TradeStation Global, which operates via an Interactive Brokers account, and TradeStation 10 and above, which is TradeStation Securities driven by the TradeStation data feed. They mention ongoing work with TradingView and recent releases related to this platform.

01:02:08

TradeStation has introduced a new table feature, which was not available previously, and this has been applied to all currency-specific indicators. The speaker highlights a recently demonstrated cryptocurrency strength indicator and notes ongoing development of a radar scanner on TradingView that will allow users to scan and identify trading opportunities using these indicators.

01:02:46

The radar scanner being developed for TradingView will function similarly to features on TradeStation, allowing users to load multiple indicators and identify trends and opportunities efficiently. The speaker briefly references a trend monitor that displays current trends, emphasizing the integration of multiple indicators in one tool.

01:03:18

Users who invest in the full package receive all current and future indicators free of charge, reflecting the company’s longstanding practice. The speaker also points out that TradingView is not Windows-based, allowing it to run smoothly on Macs and mobile devices, unlike platforms such as MT4/5 and NinjaTrader which require a Windows environment.

01:03:44

All indicators are available through the company’s group, and customers receive full credit for any previous purchases when upgrading to full packages or educational programs. The speaker introduces the Quantum Trading Education’s complete forex trading program, emphasizing its comprehensive nature.

01:04:13

Forex market importance and education

01:04:13

The speaker explains that many stock traders are focusing on the forex market because it acts as the central hub of the financial world. Forex reflects the overall risk sentiment, oscillating between risk-on and risk-off states as money moves between higher and lower risk assets. The market dynamics involve flows out of lower risk assets into higher risk assets and vice versa, with all asset conversions eventually passing through the forex market, making it the pivotal point around which commodities, equities, and bonds revolve.

01:05:44

The speaker introduces a funded trading program that allows students to trade with up to 2 million dollars of the program’s capital, removing personal financial risk. This initiative provides traders with a practical opportunity to apply their learned trading knowledge. Updates and resources related to this program and trading indicators are available on labs.quantum.trading and anacooling.com.

01:05:42

Cryptocurrency and closing remarks

01:05:42

The speaker discusses the current interesting points about Bitcoin and cryptocurrencies, mentioning that all related books are available on Amazon in Kindle or paperback formats, along with links to various sites. They thank the audience for attending, express hope that viewers have learned something new, and invite questions. Contact information is provided for Anna and David via their websites, annacooling.com and quantumtrading.com respectively. The session will be uploaded to YouTube for replay. The speaker wishes the audience a good trading day and week, encourages safety, and announces a return next week.

 

By Anna Coulling – creator of volume price analysis