How to day trade futures using volume price analysis

How to day trade futures using volume price analysis

00:01

Introduction and disclaimer

00:01

The speaker welcomes the audience to the second webinar of the day, noting it may be their first time joining this particular session on the futures market. They express gratitude for the attendees’ participation and begin by drawing attention to a disclaimer that is visible to all.

00:28

Volume price analysis overview

00:28

The speaker emphasizes the risks of trading and advises never to use money one cannot afford to lose. They introduce the concept of volume price analysis (VPA), which examines the relationship between price action and volume to determine the likely direction of price movements and the genuineness of those moves. This methodology is explained in a book available on Amazon, which includes over 200 worked examples across stocks, indices, futures, commodities, and forex. Price action is cyclical and patterns tend to repeat, but volume confirms whether these patterns will play out.

01:37

The speaker highlights that VPA provides an edge in trading by revealing anomalies and confirmations through volume analysis, making it impossible to ‘unsee’ volume once understood. They briefly pause due to technical issues and then clarify that VPA encompasses five elements: price action, volume, candle patterns, support and resistance, all analyzed across time. This foundational approach can be combined with various technical indicators like Bollinger Bands, Gann, or moving averages to enhance trading decisions.

03:02

Expanding on VPA, the speaker reiterates the combination of price action, volume, candle patterns, and support/resistance analyzed over multiple timeframes as the core trading foundation. They note that traders can layer additional proprietary or common indicators to assist with identifying trading or investing opportunities. The segment concludes with a transition toward reviewing current market charts to apply these concepts practically.

04:03

Market volatility and earnings impact

04:03

The market experienced two extraordinary days followed by a period of reduced momentum and volatility. Key indices like the US 30 and Nasdaq showed modest gains, with the Nasdaq up by 80 points. A significant number of corporate earnings reports are being released, including Apple. Important economic data such as ADP employment figures, final services PMI, and upcoming ISM reports are awaited. Additionally, crude oil inventory data and an OPEC meeting are notable events influencing market sentiment, especially for oil traders. Overall, market sentiment had been bullish but has recently calmed.

06:13

The discussion turns to trading platforms and instruments, highlighting synthetic futures contracts available through brokers on platforms like MT4 and MT5. These contracts closely track actual futures prices but require less capital to trade. The speaker reviews their charts, including silver and a version of the US 30 index, explaining how traders can identify setups and opportunities using these synthetic contracts.

06:49

Silver price action and retail trading

06:49

The speaker discusses the recent rise in silver prices, noting that silver reached a long-term target of thirty dollars, partly driven by retail traders and communities like Wall Street Bets and Robinhood users. The media has highlighted how independent retail traders have challenged hedge funds and large investors. The speaker emphasizes the importance of recognizing when to take profits during price movements, advising traders not to hold positions indefinitely but to respond to price action and volume signals indicating possible reversals. They stress the need to remove emotion from trading decisions and to avoid trading with a predetermined agenda. Finally, the speaker begins to analyze the daily chart of silver, distinguishing it from speculative narratives like the ‘game stock’ saga.

09:17

Silver chart patterns and volatility

09:17

The segment discusses silver’s recent price action, highlighting a two-bar reversal followed by a significant plunge that triggered a volatility indicator based on the average true range (ATR). It explains how volatility can be measured using either standard deviation or ATR, with this analysis opting for ATR. The volatility indicator activates when price moves beyond the typical ATR range, and despite the plunge, there was notable buying interest around the volume point of control.

10:22

This part explains the behavior after the volatility trigger: prices often retrace within the range of the volatility candle rather than continuing the initial move. The volatility candle’s high and low become important support and resistance levels. Since early January, silver has been in a congestion phase, with the market deciding whether to continue downward or reverse. The daily chart shows this consolidation, with some trading opportunities for intraday traders within these ranges.

11:26

The volume point of control at $24 has provided a solid base for a potential upward move. Two notable candles with decent volume and upper wicks are discussed in the context of market momentum, including the impact of the Wall Street Bets phenomenon, which pushed silver higher, breaking above the high of the volatility candle. The importance of volume and price action as anchors in volatile markets is emphasized, helping to identify key levels and potential market direction.

12:38

Support and resistance levels marked by volatility candles and volume profiles remain reliable even during market turbulence. The segment details how these levels act as anchor points for traders to anticipate price movements. The solid and hashed lines indicate varying strengths of these levels, and the market’s reaction to these levels can be assessed through volume analysis to determine if price will push through or reverse.

13:44

A recent gap-up led to another volatility trigger with high volume and a wick on top of the candle, indicating potential price reaction. The subsequent price movement showed a large down candle with significant volume but within a normal range compared to previous similar candles. The segment discusses the uncertainty of whether the price will continue downward or reverse, highlighting the importance for day traders to focus on identifying and acting on short-term trading opportunities regardless of longer-term direction.

14:53

The closing segment reinforces the day trader’s perspective: the goal is to identify and capitalize on trading opportunities, whether the price moves up or down. Downward moves often happen faster than upward ones, though gaps up can add momentum. The speaker also mentions having hourly charts for additional analysis, emphasizing the need to benchmark volume and price action across time frames to inform trading decisions.

15:25

Support and resistance on hourly chart

15:25

The speaker explains using support and resistance levels with the Camarilla indicator, which provides six key price levels on the hourly chart that remain relevant throughout the week. The most important levels are R3 and R4. The indicator also offers optional messages indicating when price approaches these levels, aiding in identifying potential mean reversion trades. They emphasize waiting for price to reach these key levels before taking action and note that levels on slower timeframes, like the hourly chart, carry significant weight.

16:38

Support and resistance levels on hourly and slower timeframes hold strong, especially when confirmed by faster timeframe levels. The indicator refreshes levels daily for timeframes below the hour. The speaker illustrates this with a recent price gap up that paused at the R5 level and reversed before testing R6. Price action often congests around R3 and R4 levels before breaking through or reversing, with notable swings typically occurring between S3 and R3, demonstrating the indicator’s practical application in volatile markets.

17:54

Price tends to swing between S3 and R3 levels, which can be used for swing trading strategies. Volume analysis supports identifying price direction and strength, with recent observations showing a blue candle and rising volume, though price is pulling back slightly. The speaker compares hourly chart insights with faster timeframe charts like 15-minute, Renko, and 5-minute charts, which together form a comprehensive multi-chart profile useful for precise trading decisions.

19:05

Intraday charts and Renko analysis

19:05

The speaker discusses the current state of the five-minute chart, noting a congestion phase with volatility candles and volume-based resistance below the volume point of control. The market has just opened the physical cash market, leading to an influx of volume. This period often requires patience as price action stabilizes before a clear direction emerges. The recent big move from the previous day and attempts by traders to push prices higher are met with resistance, indicating a challenging environment.

20:14

Using the MT4 platform, the speaker explains applying geometric views via Renko charts combined with Camarilla levels to analyze price action. They highlight a double top pattern and resistance at the R1 level within a congestion zone. The discussion emphasizes the importance of support and resistance (or supply and demand) as key anchor points where price tends to reverse or stall. This framework is applied specifically to silver, reinforcing the significance of these levels in analyzing market movements.

21:22

The speaker shifts focus to the YM index, using the same five-minute chart setup to analyze recent explosive moves. They point out an anomaly where a wide-range candle has lower volume compared to a previous candle, suggesting insufficient volume support for a sustained upward move. The market’s volume dynamics indicate uncertainty, and the speaker stresses the need to consider the broader market structure and slower time frames when deciding whether to follow a short or long bias.

22:33

The chart shows price struggling to break through the R4 resistance level, with falling volume and compressed price action signaling congestion. The trend monitor hints at a transition phase without a strong directional bias. The opening of the physical market caused a volatility candle and a surge in volume, but this triggered a likely retracement. The speaker advises patience, relying on Renko charts to confirm congestion and waiting for clearer price action signals before making trading decisions. The segment closes with an invitation to ask questions about volume price analysis and the indicators used.

24:21

NQ futures and trend monitoring

24:21

The speaker discusses monitoring multiple trading platforms simultaneously, focusing on the NQ (Nasdaq futures) using TradeStation and Interactive Brokers. They highlight the importance of volume and order flow during periods of high volatility, emphasizing that large executed orders, especially those in double or triple figures, are significant indicators beyond the typical smaller trades which represent market noise.

25:26

Attention is given to volatility indicators such as the radar screen and trend monitor for the NQ across varying time frames from one minute to weekly charts. The trend monitor visually represents bullish or bearish sentiment and shows how trends develop first on faster time frames before transitioning through longer intervals. This helps traders anticipate changes in market direction by confirming trends on multiple chart durations.

27:20

The speaker explains how the charts are interlinked, enabling quick switching between time frames while maintaining synchronized symbols. They describe additional tools like the dynamic volatility indicator, which tracks recent volatility triggers across time horizons. Observations are made about the cash market’s opening volatility and the positioning of the volume point of control. The discussion then shifts to the broader market context, noting the dollar’s slight decline and the VIX (volatility index) remaining elevated despite sustained bullish momentum.

28:22

The elevated VIX levels, staying in the mid-20s rather than the historically lower range, are attributed to the high volume of options trading, which distorts the volatility index. This ongoing elevated volatility contrasts with the strong bullish market trend and highlights complexities in interpreting volatility measures due to market mechanics such as options activity.

28:54

Currency futures and indicators

28:54

The speaker explains the use of currency futures in a trading platform, highlighting various currency pairs such as the Australian dollar, pound dollar, Canadian dollar (inversed), euro dollar, New Zealand dollar, and dollar Swiss. They describe the setup of indicators on the charts, including a trend monitor and trend dots, plus a dynamic volatility indicator that helps identify volatility triggers useful for intraday trading. The radar screen enables quick scanning of multiple futures or stocks to find opportunities. Additionally, the speaker mentions the CSI interface on NinjaTrader displaying three indices: YM, NQ, and ES.

30:28

Ninja trader indices overview

30:28

The speaker analyzes market activity using both five-minute and daily time frames, highlighting the presence of the volume point of control (VPOC) as a significant price level. They note that certain price levels, which previously acted as support, have now turned into resistance, as evidenced by repeated tests and rejections at these points. The accumulation distribution indicator shows strong resistance levels, with lines thickening as price levels are tested multiple times.

31:24

The accumulation distribution indicator reveals clusters of tested price levels, which strengthen the resistance or support at those points. Around the VPOC, these clusters create a channeling effect of price ceilings and floors, observable across different markets and time frames. This pattern is useful for traders who prefer to trade breakouts from congestion areas, as these well-defined levels often predict price movements.

32:27

The speaker discusses the daily chart where recent candles show weakening volume despite wider price moves, indicating a fragile rally. Although the market is trading around the VPOC, the declining volume suggests the upward move lacks strength. The analysis references a previous volume spike as a context for market fragility and emphasizes patience in trading index futures given the current uncertain rally.

33:25

The market shows signs of rollover and an attempted recovery, but the rally remains weak and lacks momentum. The speaker advises waiting patiently to see if the market will strengthen. They also mention briefly checking other markets, noting that some, like oil, showed movement earlier, indicating varied conditions across different sectors.

33:51

Oil market technical analysis

33:51

The speaker analyzes oil price movements using volume profile charts, explaining that low volume nodes act as areas where price can move quickly with less resistance. They predict oil prices could rise from $55 to around $62 per barrel before encountering significant resistance at the volume point of control, which is the heaviest volume area. This technical perspective disregards fundamental factors like OPEC decisions.

35:12

Focusing on shorter time frames like five minutes reveals high volatility and significant volume as markets open, which is typical in cash markets. Despite this volatility, the overall outlook remains bullish, depending on upcoming OPEC meetings and oil inventory reports. The discussion then shifts to soft commodities such as soybean, corn, and wheat, highlighting that technical indicators and patterns work similarly across different markets and time frames.

36:15

Soft commodities and volume analysis

36:15

The speaker explains that volume price analysis functions similarly across markets, but trading soft commodities requires understanding agricultural fundamentals. The technical analysis remains consistent. They highlight how volatility in cash markets influences other markets and emphasize the importance of volume point of control (VPOC) to identify key support and resistance areas. Observing low volume regions helps predict price movement and trading opportunities, especially around open sessions where price can move quickly through these areas.

38:09

The focus is on the VPOC as a critical level where the market may pause or break through, signaling potential trades. The speaker stresses the need to monitor volume signals and price levels ahead, considering price-based resistance, support, and volume congestion. They advise choosing appropriate time frames to analyze these factors effectively. The segment ends with a transition to reviewing index futures data across multiple time frames.

38:44

YM futures short-term trend

38:44

The segment explains the development of a trend on a fifteen-minute chart, noting how trends first appear on the fastest time frames, such as 15 seconds. The speaker describes observing a bullish phase with a classical transitional color change on the trend monitor, shifting from bright red to dark blue and bright blue. They highlight a volatility trigger indicating expected congestion in the price, with volume and trend dots providing additional confirmation. Resistance levels and slight weakness are noted on the one-minute chart.

39:34

This part focuses on price-based resistance and volume patterns. While resistance levels are tested and holding, the falling volume is seen as a positive sign. The volatility trigger on the 15-second chart explains the congestion visible on slower time frames like the three-minute chart. The speaker discusses potential breakout points above resistance levels, emphasizing that a break above 600 and then 630 could signal bullish momentum. Low volume beyond resistance levels is considered favorable for upward movement.

40:31

The discussion centers on scalping opportunities between the 600 and 630 price levels, with the 630 level being a key breakout point leading to stronger moves on slower time frames. Volume profiles are analyzed, showing lower volume nodes favorable for price movement, contrasted with heavier volume zones that could pose resistance. The speaker notes a significant volume surge at 2:30 and advises patience for the market to settle during the trading session. They emphasize the importance of marking potential opportunities based on one’s trading style, whether scalping on very short time frames or trading longer periods.

41:56

Scalping and trading session setup

41:56

The speaker discusses a trading strategy involving quick in-and-out trades with a fixed stop loss, emphasizing its simplicity and suitability for certain mental approaches to the market. They then prepare to conclude the session and briefly outline the next steps before a short break.

42:24

Quantum Trading tools and programs

42:24

The speaker explains that all indicators, including those shown earlier on TradeStation and the ones Anna will demonstrate on TradeStation Securities, are available at quantumtrading.com. Purchasing one indicator or a bundle grants free access to future indicators added to the account. TradingView is also mentioned as a versatile browser platform with many tools and indicators, including a forex program linked to a funding program. This program has been enhanced with increased profit returns, broader market coverage—including indices and gold—higher leverage from 5:1 to 6:1, and profit returns up to 60% at higher levels. The program allows trading with no personal risk, using company funds. Lastly, Anna’s website annakuling.com offers books on Amazon and links to related sites. The session concludes with a thank you and a short break.

By Anna Coulling – creator of volume price analysis