When should you exit a trade?
Determine Exits using Volume.
We will try to explore how.
A thread.
Understanding the nature of Volume and Price Movement.
1. Price increase with Volume Increase is bullish. 2. Price increase with volume decrease is NOT bullish. 3. Price decrease with volume increase is bearish. 4. Price decrease with volume decrease is NOT bearish.
Note- Please read the comments above carefully and have a look at the cheat-sheet.
Warning- Be careful with the 2nd and 4th statement.
Not bullish doesn't mean bearish and Not Bearish doesn't mean bullish.
Hence if such a volume divergence occurs, LOOK FOR EXIT.
Volume Below Average is = Caution.
If there is price expansion with volume below the Average Volume
OR
If there is price contraction with volume below the average Volume
This should be taken as a sign of caution. The price movement is happening with LOW MARKET PARTICIPATION.
If the movement after entry occurs with volume below the average volume, LOOK FOR EXIT.
Price action follows the direction of bigger market participation.
Volume below average = Only retail entry.
Higher volume= Bigger player entering the market.
Volume Divergence.
I have explained Volume divergence in the examples below which is self-explanatory.
If such an event occurs, look for further signs of reversal for an Exit.
Trade Examples.
1. Support Region Tested Several times. 2. Price decreases with Increasing volume. 3. Entry made on new Support break.
Trivia- The more a support is tested, the weaker it gets.
The same principle can be applied to all the scenario described in the cheat-sheet.
Candle Body and Volume Anomaly.
This theory was first described by David H. Weis.
Look for an exit if there is
-Uptrend
-Increasing Volume
-Low body spread & Long upper wick
- Sudden volume jump.
This is an anomaly in PA and should be looking for reversal.
Read the chart.
Retracement VS Reversal.
Sometimes people judge a normal Retracement as reversal.
I don't suggest shorting a retracement.
The short below explains retracement.
Position should be ADDED on retracement.
PLEASE read the chart carefully.
I have explained how to use Volume to judge exiting a trade.
You can summarise the above and try them on Live charts via Paper trading. Make 100 such entries to master volume.
I hope this was useful. Please share it if you found it useful.
All the best.
• • •
Missing some Tweet in this thread? You can try to
force a refresh
A Mega Thread for All Major Altcoins and how to trade them.
Book Mark and Study for your trades.
BNB
Since our last update, we flipped the 0.0093 resistance level, now forming a new range
Expecting a small range against BTC here before continuation higher.
Suggestion - Hold on to bottom entries if you bought with me around $500.
SOL
Tricky situation, if we hold range high we just flipped, I expect to reach $170 soon
Bidding region would be under $135 sweep based on BTC chart.
1. Visible Range OI Delta Profile on @coinalyzetool
Shows where traders are entering and exiting. Use this like VPVR.
Use this indicator on LTF to identify trading levels in a trending market.
In range, use this to scalp on either side as target when price deviates.
2. Aggregate OI:
Having net open interest across all trading pairs is very useful.
Sometimes, one exchange will market enter large long positions while there is no action or selling action on other exchange. This filters out misinterpretation of that data to a large extent.
Understanding some trading Analysis can be difficult because of Complicated Terms.
Must Know Trading Principles and Terms for Trading and Analysis.
A Thread.
P. S. I will keep Updating this List.
This is the thread of most important trading Concepts and Terminologies you should know to Understand and do your own Analysis.
Consider it the language of trading.
I have added links to important tutorials along side Explanation.
1. MSB - Market Structure Break.
Break of Lower Low formed in Previous impulse = Bearish MSB.
If Lower Low is Broken, consider it a Bearish MSB.
Remember, Lower High formation isn't a MSB, but Lower Low Break =MSB.