Money flow is all about risk. Discover how to identify it in the various charts

Money flow is all about risk. Discover how to identify it in the various charts

Money flow is all about risk and in this video we explain how and where to identify it in the various charts from the VIX and equities to the volatility indices. And of course relational analysis is a key part as money moves from one market to another chasing higher risk for higher return or lower risk for lower returns. This is a large topic and one we cover in the detail in the Complete Forex Trading program which you can find here https://quantumtradingeducation.com

00:00

Webinar introduction and schedule changes

00:00

The speaker welcomes the audience and apologizes for the delayed start of the webinar due to technical issues, including the hosts not receiving their webinar links. They express gratitude to attendees for joining and mention that webinars are now regularly scheduled on Wednesdays to maintain continuity in their presentations.

00:33

Trading disclaimer and market overview

00:33

The presenter introduces the forex and indices markets, emphasizing the risks involved in trading. A disclaimer is shown advising viewers not to trade with money they cannot afford to lose. The presenter then shifts focus to reviewing the current market conditions and fundamental news updates.

01:10

Canada interest rates and job openings update

01:10

The statement discusses Canada’s decision to keep interest rates unchanged, which was expected. The only surprising move would have been a rate increase or decrease. Job openings have come in slightly better than expected, which is positive news amid current labor market challenges.

01:40

Volume Price Analysis methodology overview

01:40

The speaker introduces a new series and acknowledges both regular attendees and new participants, including forex program students and users of their indicators. The focus will be on analyzing charts and markets using volume price analysis, a method that combines price action and volume to assess the authenticity of market movements.

02:13

Support and resistance in VPA

02:13

The speaker explains that Volume Price Analysis (VPA) consists of five elements, focusing here on the third element: support and resistance. They emphasize the importance of both price-based and volume-based support and resistance levels, along with a special indicator that helps assess the significance of these levels. Understanding whether these areas will cause a reversal or just a temporary pause is crucial. Additionally, grasping the current trend and how it interacts across different time frames is essential for effective trading.

03:18

Trend analysis and multiple time frames

03:18

The segment explains the importance of understanding Wyckoff’s principles involving primary, secondary, and minor trends within multiple time frames. It highlights how support and resistance levels help determine if a price pause signals a potential reversal or just congestion. The discussion also emphasizes the continuous nature of markets today, especially with 24-hour trading, contrasting it with traditional market openings where all started simultaneously.

04:27

Market session openings and sentiment

04:27

The market opened at 2:30 with upward movement influenced by sentiment carried over from Asia and the London open. The session times are interconnected across London/Europe, the US, and Asia. Additionally, alongside the main book on volume price analysis (VPA), a companion book with over 200 worked examples has been released.

05:00

VPA companion book and candle patterns

05:00

The speaker discusses traders’ demand for concrete examples of anomalies in the old Volume Price Analysis (VPA) method using actual charts. They mention a book that covers indices, stocks, and commodities, with a separate version for forex. The five elements of VPA are introduced: price action, volume, support and resistance, candle patterns, and time.

05:38

Market sentiment and commodity currencies

05:38

The speaker emphasizes the importance of analyzing multiple time frames beyond just the trading chart. They highlight the need to understand market sentiment and risk appetite when day trading forex, as these factors influence currency flows. The Australian dollar (Aussie) and New Zealand dollar (Kiwi), especially against the yen, are noted as commodity currencies that react strongly to changes in sentiment due to their ties to commodities. Positive market sentiment drives demand for these currencies, while negative sentiment leads to sell-offs. The same sentiment analysis is also valuable for index and stock traders.

06:51

US indices performance and recent sell-off

06:51

The speaker discusses the current status of major futures markets, noting that the US 30 futures are up by 376 points, the S&P futures (ES) are up 46, and the Nasdaq futures, which have experienced recent sell-offs, are up 180 points after being over 200 earlier. The Nasdaq’s gains are more modest compared to the others due to ongoing market volatility.

07:25

VIX and volatility indexes for risk appetite

07:25

The speaker discusses market sentiment and trading sessions, highlighting the importance of the VIX index for understanding risk appetite in the S&P 500. They note that the S&P acts as a global benchmark for sentiment, despite the Nasdaq’s recent strong performance. The VIX and equities have an inverse relationship: when the VIX rises, equities and futures typically fall. The speaker also mentions unusual activity in the options market but confirms the general reliability of this relationship. Additionally, the Nasdaq has its own volatility index, the VXN, which functions similarly.

09:08

Nasdaq and Dow Jones volatility indexes

09:08

The speaker explains the relationship between volatility indices and major stock indices like the Nasdaq and Dow Jones. When volatility indices fall, it generally indicates that the stock indices are rising. They also mention monitoring the pound-dollar currency pair, known as cable, noting that although a potential reversal was anticipated, the pair continued to decline.

09:46

GBP/USD analysis and Brexit impact

09:46

The speaker prepares charts to review the British Pound (Cable) situation, recapping earlier market movements including a scalp and subsequent decline. They discuss the influence of Brexit developments on the pound, highlighting ongoing debates about the UK’s withdrawal agreement and media polarization on the issue. Despite the uncertainty and partisan opinions surrounding Brexit, the British Pound has shown some recovery.

10:50

New Zealand Yen price movement analysis

10:50

The speaker discusses the New Zealand yen, highlighting its volatility with a 100 pip drop followed by a 100 pip rise, making it a notable pair for sentiment analysis. They mention monitoring the YM index, which is also trending higher, before passing the discussion over to David for his chart analysis.

11:19

VPA lessons on support, resistance, and trends

11:19

The segment reviews four VPA lessons focused on support and resistance, analyzing trends, identifying potential reversal points within a trend, and recognizing opportunities to join ongoing trends. An interruption occurs due to technical difficulties with the Ninja Trader platform, requiring a brief reboot.

12:00

Forex indicators for currency flow monitoring

12:00

The speaker introduces specialist forex indicators designed to monitor currency flows and highlight potential trading opportunities. These indicators also signal when there are no viable trades, particularly during narrow, non-trending ranges. The lines on the screen represent different currencies, showing trends such as a strong decline in the Japanese yen and a recovery in the British pound after a period of heavy selling over the past few sessions.

13:09

Currency strength and directional flows

13:09

The speaker discusses analyzing currency pairs, specifically mentioning the New Zealand dollar and the Australian dollar moving strongly higher. They suggest examining yen pairs to understand individual currency flows and prefer using the hourly chart for trading, while also monitoring multiple indicators on faster time frames.

13:43

Indicator matrix and trade signal upgrades

13:43

The speaker discusses the usefulness of the hourly chart for observing cross-session crossovers, which helps understand recent market activity and predict potential currency movements. They explain that data from this chart is compiled into a matrix to identify the strongest currency pairs and whether buying or selling pressure dominates. The indicator generates numerical values that provide insights; for example, a high number like +86 indicates a strong move in the New Zealand dollar. An upgrade is planned to include a signal service that will help interpret whether such numbers are high, median, or average.

14:55

Commodity dollar buying strength

14:55

The speaker explains that the current time frame has been applied to TradeStation and will soon be implemented across other platforms. They discuss a high numerical value observed, noting that on the weaker end of the spectrum, such as the Swiss Dollar, the value is only minus 38. This indicates that most market activity has been focused on buying rather than selling.

15:27

Currency array and market sentiment insights

15:27

The discussion highlights strong movements in major indices like the Nasdaq and Dow, with significant gains reflected in currency pairs, particularly those involving commodity currencies such as the New Zealand dollar and Australian dollar against the yen. This currency array indicates the strength of trends and provides nuanced insights into money flow and market sentiment. Such information is valuable not only for forex trading but also for understanding broader market dynamics, especially for index traders who should monitor safe haven currencies like the yen.

16:39

NinjaTrader platform update and Q&A invitation

16:39

The speaker invites viewers to join David, who has everything set up and ready. They encourage the audience to ask any trading-related questions or clarify anything shown on the screen by using the chat box, assuring prompt responses.

By Anna Coulling – creator of volume price analysis