Using the tickspeedometer to help reveal participation and momentum in all markets

Using the tickspeedometer to help reveal participation and momentum in all markets.

00:00

Webinar introduction and disclaimer

00:00

The host welcomes attendees to the webinar, noting the global audience including participants from New Zealand. They invite viewers to share their locations in the chat for personalized greetings. Before beginning, the host highlights the disclaimer that trading involves significant risk.

00:30

Audience overview and trading categories

00:30

The speaker advises viewers not to use money they cannot afford to lose. They acknowledge the presence of various participants, including Forex program students, quantum software users, book buyers, and newcomers. The session is set to begin with a discussion of the charts and the underlying methodology.

01:06

Volume Price Analysis methodology

01:06

The speaker introduces volume price analysis (VPA) as a method to analyze charts by examining the relationship between price action and trading volume. This technique helps confirm whether market movements are genuine or traps set by insiders, market makers, or smart money. VPA is versatile and can be applied across all markets and timeframes. Although this session focuses on day trading with faster timeframes, the methodology is also useful for investing in stocks and other assets.

02:20

Trading timeframes and emotional factors

02:20

This segment discusses how traders can use medium-term timeframes such as 30 minutes to four hours, or even shorter periods like scalping, depending on their comfort level. It emphasizes that trading approach varies based on individual confidence and emotional management, highlighting the challenge of facing potential losses and the importance of being able to handle them.

03:02

Using VPA with other indicators

03:02

The speaker discusses the uncertainty inherent in the markets and explains that Volume Price Analysis (VPA) offers unique insights that other methodologies may not provide. While VPA can be combined with other indicators and approaches, the key is to find timeframes and instruments that traders feel comfortable with, which is often discovered through trial and error. The methodology focuses on anticipating what is likely to happen next, reducing trading stress. Additionally, a companion book with worked examples is available to help users understand and apply VPA effectively.

04:14

Market patterns and participation

04:14

The speaker explains that the market is fundamentally a market of repeating patterns, which can appear across different instruments over time. The effectiveness of a trading setup based on price action depends heavily on volume, as genuine participation is required. This participation must come not only from retail traders but also from those with significant financial resources. The discussion transitions to reflecting on the end of the week and month, noting the market’s volatility amid ongoing challenges such as the pandemic, with some participants seemingly ignoring fundamental news.

05:28

Economic news and market impact

05:28

The speaker discusses recent economic data, noting that while natural gas inventories and other nutrients have been mostly accounted for, the preliminary US GDP figures were very poor as expected. Durable goods orders declined by 17%, slightly better than feared but still concerning. Unemployment claims have surged by another 2 to 4 million, reflecting significant economic damage that will become clearer with upcoming data releases.

06:35

Despite the troubling economic indicators, stock markets are showing positive sentiment. The Dow and S&P 500 have risen, with the Nasdaq slightly less robust but still up. This optimism is partly due to end-of-month portfolio adjustments by fund managers who need to finalize their positions and reports for investors.

07:13

Currency flows and market sentiment

07:13

The speaker discusses recent changes in the forex market, noting the end of the London fix-related volatility caused by investment banks rebalancing large currency blocks. They introduce the Currency Strength Indicator (CSI) as a tool to track currency flows, highlighting recent divergence such as strong inflows into the euro and heavy selling of the US dollar and Canadian dollar. The yen is depreciating, which reflects positive market sentiment, while the Swiss franc is strengthening despite likely intervention attempts by the Swiss National Bank to keep its value down. The Swiss franc’s safe haven status is also mentioned, along with buying interest in the British pound.

08:55

The focus shifts to recent movements in the New Zealand and Australian dollars, with particular attention on the Australian dollar as analyzed via NinjaTrader charts. The speaker also previews a session on Volume Price Analysis (VPA), emphasizing the study of reversal patterns and specific candlestick formations to identify potential market reversals, building on previous lessons about reversals.

09:29

Trading patterns and reversal candles

09:29

The speaker discusses contributions from traders in the VPA room, highlighting a particular pattern identified on the hourly chart. This pattern, described as a double chop, is notable for generating significant price moves, especially when observed on slower timeframe charts. The speaker references the Australian dollar as an example where this pattern has been effective before transitioning the discussion to David.

10:02

Arctic Speed indicator explanation

10:02

The speaker introduces an indicator developed for the NinjaTrader platform, also planned for TradeStation, called Arctic Speed or a tip speedometer. This tool measures market momentum during low-activity phases, helping traders identify when price action is sluggish or lacks strong momentum. The indicator analyzes activity within the candles, providing insights beyond typical visual cues like doji candles or congestion, to gauge the true pace of market movement.

11:12

Price action and market momentum

11:12

The discussion focuses on the Australian dollar’s recent price movement, which shows a slow and hesitant upward drift rather than rapid changes. The speaker explains a color-coded activity indicator where green signals bursts of activity, amber is moderate, and red indicates low momentum, suggesting the currency isn’t moving quickly. They mention measuring tick volume over a timeframe equivalent to three minutes, noting 733 ticks, and highlight the importance of understanding market participation, especially in futures trading. This tick data provides insight into the underlying activity behind price movements.

12:21

The speaker elaborates on how slowing market activity, particularly on faster charts, signals traders to be cautious as sudden moves can occur quickly. They introduce the Renko chart as a tool that helps identify these changes effectively. Using the Aussie dollar on the NinjaTrader platform, they note that Renko charts function differently compared to MetaTrader 5, where users can customize Renko values. Overall, the segment emphasizes the importance of tools that reveal market participation and price action nuances to better anticipate potential rapid shifts.

12:56

Renko charts and tick speed

12:56

The speaker explains the concept of time charts and how brick size is calculated for a specific time frame, emphasizing that the brick size is based on pips rather than time. They illustrate how each brick completes at one and a half pips and discuss a current market scenario where the price is drifting sideways near a support level at 66.85. The movement is slow, highlighted by the formation of bricks and tick speed, indicating market activity but not rapid price changes.

14:08

Combining analysis and market news

14:08

The discussion focuses on analyzing momentum in a specific trading pair using a combination of instruments, volume, and price analysis to understand past trends and predict future movements. The approach integrates technical analysis with fundamental news, including current events like updates from Donald Trump’s Twitter feed, emphasizing the importance of considering broader market factors rather than just chart patterns.

By Anna Coulling – creator of volume price analysis