Trading With Market Statistics.II The Volume Weighted Average Price (VWAP).

[jperl]

	Quote:	unicorn
	Hi Jerry; I am going through your threads for the second time to absorb the nuances of your method. I have not found the topic that refers to "Old POC's or PVP's do get touched. " I suppose that the HUP in section XI, is the proper location, but I find that the information presented there is limited. I would appreciate your advise with respect to this topic. Thank you. Unicorn.

I didn't have much discussion about trading at Old PVP's except for the post in the HUP thread. There is a complete discussion of PVP trading at the "Trading with Market Statistics VII: Breakout Trades at the PVP" thread. In that discussion and in the HUP post, I point out that entering trades at the PVP is not a good idea. It doesn't matter whether the PVP is old or new, touched or untouched. The basic point is that if the skew is large, ANY PVP represents a dividing line between the high volume area and the low volume area. If you take a trade at the PVP in the direction of the high volume area and it turns out to be wrong, you can be wrong big time with a large breakout into the low volume area against your entry. If the skew is small (VWAP~= PVP), the volume is the same on both sides of the PVP. Then you might as well flip a coin. Bottom line, don't enter trades at the PVP, new or old. (This is in sharp contrast to the Enthios style of trading).

[Anonymous]

Jperl;

That is indeed in direct contrast to the Universal method used by Enthios. What do you think about the NTR then? NTR: Natural Trading Range

[Râlex]

Hi traders,

if I can afford, you should not try to predict (as NTR) but to succeed in following tendency (as the skew and price).

Too, i agree with Jerry and i understand the difficulty of trades at the pvp or hvl.

The NTR as the Vpoc are speculations and a VSA trader should not take into account NTR, no ?

Cause, where the smart money goes, i will follow it !

[jperl]

	Quote:	PivotProfiler
	Jperl; That is indeed in direct contrast to the Universal method used by Enthios. What do you think about the NTR then? NTR: Natural Trading Range

The NTR is Enthios' estimate of today's trading range based on previous untouched POC's. I have looked at this concept but I have not found it of value.

[unicorn]

	Quote:	jperl
	I didn't have much discussion about trading at Old PVP's except for the post in the HUP thread. There is a complete discussion of PVP trading at the "Trading with Market Statistics VII: Breakout Trades at the PVP" thread. In that discussion and in the HUP post, I point out that entering trades at the PVP is not a good idea. It doesn't matter whether the PVP is old or new, touched or untouched. The basic point is that if the skew is large, ANY PVP represents a dividing line between the high volume area and the low volume area. If you take a trade at the PVP in the direction of the high volume area and it turns out to be wrong, you can be wrong big time with a large breakout into the low volume area against your entry. If the skew is small (VWAP~= PVP), the volume is the same on both sides of the PVP. Then you might as well flip a coin. Bottom line, don't enter trades at the PVP, new or old. (This is in sharp contrast to the Enthios style of trading).

Thank you Jerry.

I do have another question, that due to its relevance is posted at the Position Trading thread - section X.

cheers.
Unicorn

[btfox]

From what I have read so far it seems that too much emphasis is placed on POC, which in MP is not the main reference point (at least for trading purposes), rather the rotation and the distribution above and below it. Also, please note that according to MP authorities, like Don Jones of Cisco-Futures and others with a long time acquaintance with MP, distribution does not have to be in 30 minute increments. It can be daily, 10 or 20 days, monthly, etc.. The MP distribution is:
-more significant over longer time frames (say 3 days or more) and many software packages offer merging and splitting tools.
-the IB or initial balance varies from one market to another...but those time periods have always been important to traders. If you are on the floor you can hear the horn and look for some increased activity (a number of trades have been developed off these time periods). I've heard that institutions generally trade at certain times of the day; some of it may be adjust their positions, or it will sometimes be reacting to news.
- more significant are the times when MP moves or rotates and establishes a new balance area, hence the larger moves.
-granted there a subtleties throughout the day, and traders have been trying to optimize them to that end.
-but in general it is the reaction to extremes that gives us trades; the POC can be an unhappy place

It has taken some time to decipher the original MP studies and for traders to use of them, but we can thank those who have spent time doing so. And thanks to whomever started this thread. I think it looks promising.