[Volume Based Candles] and how to profit

[cjstrader5]

I spent the hour or so reading all the post on this subject and now I am totally confused. Has anyone come up with a good average starting point or average for the number of share bars and what moving averages are you using?

[TinGull]

I say, take the issue you like trading be it YM, ES, ER....and find a time frame you feel comfortable with. Like trading a 5min chart, for example. Take the average volume coming through on a 5min chart and use that as a starting point for your VBC charting.

[brownsfan019]

	Quote:	cjstrader5
	I spent the hour or so reading all the post on this subject and now I am totally confused. Has anyone come up with a good average starting point or average for the number of share bars and what moving averages are you using?

For starters, the thread is about VBC's, not moving averages.

As has been stated throughout the thread, there is no perfect starting point for where to set your VBC. It depends on YOU. No one can answer the question for YOU. YOU have to spend some time with them and see what works for YOU.

Get the idea?

You can go as low as 2000 up to 50,000+ on the ES in my opinion. That's a big range obviously, so there's no way for myself or anyone to tell you where to start. If you want to see how they look, you'll have to spend some time playing with them.

[BlowFish]

Just as an aside you might wanna take a look for posts by Bill Shamp (he posts as ProfLogic and another pseudonym I can't remember off hand, CharlieChan or something) over at Ellite Trader (dont stay too long it will corrupt your mind).

He is a long time proponent and vocal supporter of constant volume bars. Amongst the dross you will probably find everything you could possibly wish to know about them.

I use them for some applications but in others I find time important. Brown says he likes to see a good skirmish between bulls and bears (as do I!) but market participants withdrawing and price 'drifting' can tell a story also (a story that gets lost with constant volume bars). Some like to view 'corrections' for example as corrections in price or time, corrections in time tend to get lost in constant volume charts.

This is not meant to be a criticism of CV charts - they are great for all sorts of things- Know your tools I guess am saying

Cheers.

[brownsfan019]

	Quote:	BlowFish
	Just as an aside you might wanna take a look for posts by Bill Shamp (he posts as ProfLogic and another pseudonym I can't remember off hand, CharlieChan or something) over at Ellite Trader (dont stay too long it will corrupt your mind). He is a long time proponent and vocal supporter of constant volume bars. Amongst the dross you will probably find everything you could possibly wish to know about them. I use them for some applications but in others I find time important. Brown says he likes to see a good skirmish between bulls and bears (as do I!) but market participants withdrawing and price 'drifting' can tell a story also (a story that gets lost with constant volume bars). Some like to view 'corrections' for example as corrections in price or time, corrections in time tend to get lost in constant volume charts. This is not meant to be a criticism of CV charts - they are great for all sorts of things- Know your tools I guess am saying Cheers.

Fish - That is where I first learned about them and quoted the source here - http://www.traderslaboratory.com/for....html#post7813

Just giving credit where credit is due.

As you said, there's many ways to construct your chart and many ways to interrupt them so it's a matter of personal preference and what produces profitable trading opportunities for each trader. For me, it's been b/c of VBC's. For others, they prefer other settings. It really doesn't matter as long as it makes YOU money!

[BlowFish]

Ahh OK pardon me I must have missed that maybe it was on the other VBC thread. Actually I have been travelling a lot recently and probably just missed it. Of course the good prof didn't invent these bars or anything he's just a vocal proponent as I said.

Quite right, many ways to skin a cat, glad you have found your own particular knife. Personally I quite like them with some what larger value bars to smooth out overnight session and lunch time doldrums to get the bigger picture. I also quite like using them with Drummond Geometry.

It's kind of interesting to see how things change for example with Drummond 59's often turn into 53's. With candles A WRB often turns in to three white soldiers. (of course it would do if it was a high volume time based WRB). If you get a WRB bar on a CV chart it means something quite different to on a time based chart (it after all needs a large movement on relatively low volume to form).

Interesting to see where you go with all this.

Cheers.

[brownsfan019]

	Quote:	BlowFish
	Ahh OK pardon me I must have missed that maybe it was on the other VBC thread. Actually I have been travelling a lot recently and probably just missed it. Of course the good prof didn't invent these bars or anything he's just a vocal proponent as I said. Quite right, many ways to skin a cat, glad you have found your own particular knife. Personally I quite like them with some what larger value bars to smooth out overnight session and lunch time doldrums to get the bigger picture. I also quite like using them with Drummond Geometry. It's kind of interesting to see how things change for example with Drummond 59's often turn into 53's. With candles A WRB often turns in to three white soldiers. (of course it would do if it was a high volume time based WRB). If you get a WRB bar on a CV chart it means something quite different to on a time based chart (it after all needs a large movement on relatively low volume to form). Interesting to see where you go with all this. Cheers.

The reference was made in this thread, but just earlier in the thread.

You hit the nail on the head - VBC's smooth everything out. And if that works for you, as it does for me, it's invaluable to trading. Like you said, the overnight session and lunches are presented in quite a different light. As mentioned in the thread, I also love how these react around news announcements b/c it gives me the opportunity to get into a trade instead of waiting for a minute chart to form and then giving me a monstrous candle. I think there's some examples somewhere here, but it's worth looking at in my opinion for anyone reading this. Just open a minute chart and then open a VBC and see how things look to you!

[Mitch]

Brownsfan,
Having read this & the entire thread on elite trader I was wondering if you use anything else with the voume candles ( as prof logic does on elite trader) to assist or just the candle formations/patterns alone?
Mitch

[brownsfan019]

	Quote:	Mitch
	Brownsfan, Having read this & the entire thread on elite trader I was wondering if you use anything else with the voume candles ( as prof logic does on elite trader) to assist or just the candle formations/patterns alone? Mitch

Good question Mitch. I mainly use the VBC's for intraday trading to smooth the charts out. I am a candle trader by nature, so the VBC's seem to be a great fit with them. I'm mainly looking for strong candle patterns at support/resistance levels. I also want to be in trades when things are moving and the VBC allows just that.

Make sure to watch a VBC today before the Fed announcement and you will really see how these work in fast moving markets.

[brownsfan019]

JUST A REMINDER:

IF YOU REALLY WANT TO SEE THE POWER OF THE VBC, SET UP YOUR CHARTS TODAY BEFORE THE FED ANNOUNCEMENT AND JUST WATCH HOW THE VBC LOOKS COMPARED TO A MINUTE OR TICK CHART.

Today is a perfect example of how these can REALLY work.