Emperor👑 Profile picture
Apr 2, 2021 10 tweets 4 min read Read on X
MASTER-CLASS on Volume Exit.

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. Image
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. Image
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.
Image
Image
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. Image
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. Image
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. Image
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.

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More from @EmperorBTC

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You should have clear Steps to be followed when looking at a new Chart. No guess work.

Here is my System.

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bit.ly/3SNyxnq

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Constantly be online with friends trying to follow price movement, capital movement, inflows and activities of projects.

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𝗖𝗢𝗠𝗣𝗟𝗘𝗧𝗘 𝗩𝗢𝗟𝗨𝗠𝗘 𝗧𝗥𝗔𝗗𝗜𝗡𝗚 𝗖𝗢𝗨𝗥𝗦𝗘.

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Tutorial- https://t.co/D5zdScAvn0bit.ly/3CJUWZf
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