Learn how to ride the trend to maximise your profits

Learn how to ride the trend to maximise your profits

Most traders struggle, not because they do not understand how the markets work, but because they struggle to stay in a trend once it is underway. The problem then becomes one of small losses but more importantly, small profits, and as a result, the trading account never grows. Staying in a trend is the hardest thing to do in trading, and in this video, we show you how!

00:13

Intro and sound issues explanation

00:13

The speaker greets the audience and apologizes for any potential sound issues due to their remote location on a hill in a national park, which can affect internet connections during storms. They ask for patience regarding any audio disruptions.

00:50

Using Renko and multiple time frames

00:50

The speaker discusses their current trading setup, mentioning the mast on a hill and focusing on currency trading, specifically the pound and dollar. They describe using multiple time frames—15 seconds, 30 seconds, and one minute—to analyze volume and price. The advantage of trading on a non-time-based chart is highlighted, noting a clear downward trend and emphasizing straightforward trading. The key advice is to wait for news-related volatility to subside and then trade based on chart observations without overanalyzing market movements.

01:49

Trading with volatility index (VIX)

01:49

The speaker discusses the importance of ignoring confusing market signals and focusing on trading based on chart observations. They reference the VIX volatility index across multiple time frames (5, 10, 15, and 20 minutes), noting that the VIX has generally been rising strongly. This rise in volatility has coincided with a clear downward trend in the market since recent developments, especially after a figure named Ana began speaking. The speaker mentions checking other market instruments like the YM and highlights the presence of numerous volatility triggers indicating a shift toward sideways market movement.

02:49

Renko indicators: trend monitor and dots

02:49

The speaker discusses observing sideways price action and highlights the use of Renko charts, focusing on two key indicators: the trend monitor and trend dots. Trend dots transition first by changing to a transitional color, moving above and below to signal potential reversals. Despite these changes in the trend dots, the trend monitor remains consistent, indicating ongoing market conditions without flickering, even on shorter time frames like 15 or 30 seconds.

03:49

An extensive congestion phase is described where the trend monitor shifts from darker red to darker blue but never to brighter blue, showing the indicator’s role in helping traders stay in trades during consolidation periods. The importance of maintaining positions through such phases is emphasized, as panic during reversals often causes traders to close positions prematurely and incur losses. The trend monitor, developed for a single purpose, offers the confidence needed to hold through these emotionally challenging periods, especially when used alongside trend dots that react earlier to market changes.

05:09

Advantages of non-time-based charts

05:09

The speaker explains the advantages of combining the trend monitor with Renko bricks, emphasizing that Renko and tick charts reveal momentum within candles that time-based charts cannot. Unlike a standard five-minute candle showing a single block of time, Renko charts break down price action into smaller components, making momentum visible and easier to analyze.

06:12

The default Renko brick size is set to the minimum price change for each instrument, such as one point for the YM and one tick for the NQ and ES. The speaker details the point values for each brick—eight points on YM, ten on another, and thirteen on a third—and explains how these translate into dollar amounts per brick, using the mini Dow as an example where each point is worth five dollars.

06:43

The speaker discusses a recent price move represented on the Renko chart, noting that even a few bricks can represent significant dollar values. They describe the current market phase with congestion and a renewed bearish signal, mentioning that the trend has stabilized and referencing the VIX indicator to provide additional market context.

07:11

Yen positions and trading advice

07:11

The speaker observes a rise in the VIX, indicating increased market risk and a risk-off environment. They discuss holding multiple yen positions, mostly selling yen, which has generated a healthy profit for the day. Despite expectations for the yen to strengthen, it has continued to weaken over the past half hour. The speaker emphasizes the importance of trading based on chart observations rather than speculation, advising to ‘enjoy the ride’ during fast-moving markets. They also mention checking volume on 15-second and 30-second Renko charts, noting adjustments in optimal brick sizes to nine and thirteen points respectively, reflecting current market conditions.

09:06

Renko brick size adjustments

09:06

The segment explains the relationship between Renko chart brick sizes and time frames, noting that slower time frames result in larger bricks, here set at 19, 13, and 9 points. It highlights a two-bar reversal pattern resembling a near-perfect hammer, integrating volume price analysis (VPA) and momentum perspectives on the Renko chart. The analysis observes a slowdown in upward momentum and increased volatility, reflected in the trend monitor’s rapid shift from bearish (dark red) to bullish (bright blue), indicating a potential strong trend change.

10:36

Volume price analysis and momentum

10:36

The discussion focuses on analyzing different market indices on a five-minute timeframe, noting signs of a potential reversal. Observations include increased buying activity indicated by volume and wicks on price charts. The VIX volatility index is dropping, suggesting reduced market fear. On the NQ index, a volatility trigger hints at possible congestion or a complete reversal developing soon.

11:31

Accumulation distribution and resistance

11:31

The speaker analyzes a price setup characterized by strong volume beneath a candle and notable wick formations. They highlight a significant cluster of two strong levels on the accumulation-distribution indicator, explaining that thicker lines represent well-developed levels tested multiple times and acting as strong support or resistance. The cluster’s strength is emphasized by its accuracy in holding the upper level and pushing the price down, illustrating the value of using multiple charts and related markers across different time frames to gain deeper market insights.

13:01

Multiple indices and volatility triggers

13:01

The speaker discusses recent market behavior, noting that while markets generally moved in the same direction over the past weeks, recent volatility has introduced uncertainty. A volatility trigger has appeared in one market, suggesting potential congestion or a reversal ahead, which aligns with current observations. The VIX shows a similar pattern with volatility candles indicating sideways movement and a pause in the downward trend. The trend monitor reflects a bearish overall trend, reinforcing the cautious outlook and highlighting the interconnectedness of related markets.

14:33

Market relationships and risk assets

14:33

The discussion focuses on market relationships, emphasizing analyzing equivalent risk asset classes within a particular market, such as indices or related currencies in forex. It also considers factors outside the market sector, like risk-on and risk-off asset classes. The speaker highlights recent market movements, noting the Nasdaq’s strong, persistent rise driven by major tech players, while the Dow Jones and S&P 500 have shown more sideways and catch-up patterns, often moving in tandem but contrasting with the Nasdaq’s distinct behavior.

16:11

Trading indices and avoiding opinions

16:11

The speaker emphasizes the importance of trading based on what is seen on the chart rather than personal opinions or over-analysis. They highlight that trading with an opinion is risky and advise traders to focus on the market’s actual movements without trying to rationalize or predict based on external factors. The segment concludes with a transition to another speaker for further commentary on the topic.

17:21

Index composition and tech influence

17:21

The discussion focuses on major stock indices like the Dow, Nasdaq, and S&P, highlighting that the Dow futures have been lagging compared to the Nasdaq. A recent change in the Dow’s composition is noted, with Exxon being removed and replaced by more technology-oriented companies like Salesforce, making the index more tech-heavy. This shift reflects the market’s current leadership by a small group of tech stocks, driven by expectations of a tech-focused future shaped by the pandemic. Traditional sectors such as oil and airlines have struggled recently. Traders are advised to carefully examine the components and drivers of any index they consider trading, as market gains have been concentrated and lack broad participation.

19:08

Market sentiment and climbing the wall of worry

19:08

The speaker discusses market sentiments where many analysts and commentators believe that markets, such as the Nasdaq, have reached their peak and are due for a decline. This phenomenon, described as ‘climbing the wall of worry,’ reflects how rising markets often trigger fear among investors who expect a reversal. The example of Tesla, the most shorted stock in history, is used to illustrate how despite heavy short selling and widespread expectations of a drop, the stock continues to rise. The speaker advises traders to avoid letting such opinions influence their decisions and to remain objective about market updates.

20:21

Globex trading and futures market insights

20:21

The speaker emphasizes the importance of monitoring the Globex futures market alongside the cash market, noting that most gains in indices often occur during Globex hours. They highlight that price movements during this time can sometimes reverse the next day’s sentiment. Additionally, the speaker discusses the concept of market turning points, suggesting that when persistent bearish investors give up, it may indicate a market bottom. They also mention following diverse opinions, including those of well-respected perpetual bears who argue why the market should not rise.

22:00

Ignoring opinions and trading what you see

22:00

The speaker discusses market movements, emphasizing the importance of trading based on observed price action rather than opinions. They mention receiving a notification about a market shift and highlight the value of understanding price action through volume analysis, support and resistance, multiple time frames, and candle patterns. Additionally, they explain that their developed trading tools are designed to support this established methodology, which they have refined over 20 years.

23:06

Cable forex movement and oil market update

23:06

The speaker reviews recent market movements, noting a reversal on the cable (GBP/USD) pair with a minor downside trade that halted exactly at a previous support level before attempting to move higher. They explain that forex markets tend to oscillate, requiring traders to enter and exit positions repeatedly amid consolidation periods. Additionally, a quick check on oil markets reveals sluggish performance despite OPEC activity and a weakening dollar, which have not yet provided significant upward momentum.

24:12

YM index rally and VIX reversal

24:12

The video discusses a rally developing in the YM market, noting strong buying volume and a lower candle indicating some congestion. Attention is given to a reversal in the VIX, with volatility starting to decline, signaling potential caution for traders. The speaker highlights volume patterns across different time frames—5, 10, and 15 minutes—observing rising volume followed by a pause, which may influence the continuation or reversal of the current trend.

25:22

Fast trading strategies and trend monitor

25:22

The discussion focuses on short-term trading strategies, particularly using 15-second charts, which can be fast-paced and may not suit every trader. The trend monitor shows rising volume and price, moving out of congestion zones into low volume areas, while the VIX is decreasing. This environment suggests a good opportunity for upside trades and scalping small profits from the market.

26:15

Traders are advised to enter and exit trades quickly, with each point valued at five dollars. For beginners, it’s recommended to start with micro futures contracts introduced by the CME, which are one-tenth the size of standard contracts and require much less margin. Micro futures offer smooth and liquid price action, unlike some other markets such as currency micro futures, which can be more volatile and erratic.

27:13

Micro e-mini futures contracts provide smooth price action due to high participation, unlike other markets where prices can jump unpredictably. Currently, a slight pause and some selling are observed, but the VIX continues to decline without signs of reversal or congestion, indicating a stable environment for trading at this time.

27:46

Volume analysis and price action

27:46

The segment discusses analyzing one-minute candles by comparing volume and price action to detect anomalies or confirmations. It emphasizes comparing the volume of the current candle to previous similar candles to assess strength or weakness. For instance, a candle with less volume but similar price movement may indicate weaker effort behind the move.

28:52

The speaker explains how volume behavior during sideways price action and narrow-spread candles can indicate market dynamics. Falling volume aligned with narrow candles suggests low activity, whereas high volume on a narrow candle implies heavy selling pressure by insiders or market makers. The discussion concludes with noting a pause point in the market, coinciding with a thick volume congestion area, indicating resistance to upward movement.

30:17

Volume point of control and congestion

30:17

The volume quality control indicator adds value by highlighting key volume points that act as market fulcrums and areas of market strength or weakness. High volume zones indicate resistance where the market struggles to break through, while low volume areas suggest easier price movement. Traders use these volume insights in conjunction with multiple time frames to build confidence in their decisions to enter, hold, or exit trades.

31:12

Current price action shows a cluster of support and resistance levels, with recent candles indicating that selling pressure has been absorbed rather than pushing prices lower. Narrow candle spreads with small wicks suggest a potential continuation of the upside move, but the price must break through established resistance zones first for a clearer bullish signal.

32:08

The focus is on breaking out of the current price region to reach higher resistance levels that offer significant profit potential. On a one-minute chart, volatility is fluctuating, causing mixed price action. Recent selling pressure was absorbed, and an upward push is beginning, with the goal of surpassing key resistance points and extending the upward trend.

33:12

Despite some initial upward effort, strength is capped at a significant resistance level confirmed by accumulation/distribution indicators showing high volume rejection. Price is trading within a narrow channel defined by tested and retested support and resistance. These indicators adapt dynamically to price action, providing precise, constantly updated signals that explain ongoing market movements and price level significance.

34:09

Support, resistance and trend monitor

34:09

The speaker analyzes a narrow range of price action in trading, noting that despite a minor reversal, the trend has not shifted from red to blue, indicating no real change in trend yet. They emphasize the effectiveness of using trend monitors across multiple time frames to confirm this. Additionally, the speaker advises beginners in trading indices to start with the micro YM contract, as it is the smallest and least volatile index, offering safer initial exposure.

35:18

Volume nodes and trade targets

35:18

The speaker analyzes market volume and price resistance, noting a low volume node followed by significant volume. They highlight that there is minimal price resistance ahead, allowing the price to move quickly through a ‘clear water’ zone of about 30 points before encountering increasing volume. This setup suggests a likely upward movement in price.

36:10

Focusing on shorter time frames, the speaker points out that a recent candle triggered increased buying volume supporting a price rise. The price has broken through a resistance level and is moving towards 80, with volume remaining low on the ascent. Additionally, the VIX (volatility index) is dropping steadily, which supports confidence in the ongoing upward trend.

37:04

The speaker advises a relaxed approach to trading indices by focusing strictly on chart signals and letting trades run their course. They emphasize using trend monitoring tools like trend dots on Renko charts across multiple time frames—whether time-based or non-time-based—reiterating that the core trading principles remain consistent regardless of chart type.

37:36

Trading indices with confidence

37:36

The speaker apologizes for a momentary interruption and introduces Quantum Labs, highlighting their website labs.quantumtrading.com. They describe features available on TradeStation, specifically mentioning the RadarScreen tool. The focus is on the currency strength indicator, which displays ranked currency pairs along with overbought and oversold signals on the right-hand side.

38:06

Quantum Labs indicators and platform updates

38:06

Significant work has been invested in developing various trading indicators, including arrays and matrices, for multiple platforms such as TradeStation, NinjaTrader, and TradingView. The TradeStation integration, which supports accounts linked through Interactive Brokers, is progressing well. After launching on TradeStation, development will focus on adding more indicators to TradingView using Pine Script, enhancing the offerings for users with the full TradingView package.

39:01

Forex trading program and community

39:01

The speaker explains that purchasing any indicators on TradingView includes a free upgrade to the full forex trading program available at quantumtradingeducation.com. This comprehensive program covers all essential aspects of forex trading, including psychology, fundamental and technical analysis, trading mechanics, and relational analysis. It also offers numerous webinars and live sessions focused on indicator usage and practical examples, supported by a community of experienced traders in the VPA room. The session concludes with a thank you, a note on the upcoming schedule due to the UK bank holiday, and well wishes for the trading week and weekend.

40:27

Closing remarks and next session info

40:27

The speaker concludes the segment with a brief farewell message.

By Anna Coulling – creator of volume price analysis