Posted By: Ilan Levy-Mayer Vice President, Cannon Trading Futures Blog
1. Market Commentary
2. Futures Support and Resistance Levels – S&P, Nasdaq, Dow Jones, Russell 2000, Dollar Index
3. Commodities Support and Resistance Levels – Gold, Euro, Crude Oil, T-Bonds
4. Commodities Support and Resistance Levels – Corn, Wheat, Beans, Silver
5. Futures Economic Reports for Wednesday July 17, 2013
For 2013 I would like to wish all of you discipline and patience in your trading!
In today’s post I actually want to share how I create volume charts using Sierra Charts (also known as AT charts). Email me to find out how you can have Sierra Charts for free!
I like to use volume charts for futures trading when it comes to intraday or high frequency trading. So if you are an active trader or a scalper, you may want to explore the use of volume charts and see if you can find an edge.
My theory is that when it comes to short term day trading, volume is much more important than time, hence the use of volume bars. I use bars of between 1,000 to 18,000 contracts traded (pending the specific market, based on recent volatility, trade volume and a few other factors). That means that instead of bars completing based on time frame (i.e. 1 minute or 15 minutes etc.), we use volume instead of time. So each time X,000 contracts traded, a new bar will complete. When the specific market has high volume and is moving fast, the bars will complete faster. When market is in low volume without much action, the bars will complete slower.
For me personally, this has helped getting signals ahead of time when there is fast action in the market and avoiding false signals when volume is low.
So in Sierra Charts I right click inside the chart and choose chart settings.
In chart settings I use the drop down menu under the Bar Period like in the screen shot below.
I then specify the amount of volume I want per bar. (I normally look at average daily volume and divide that by 20) and click apply.
Below you will see my intraday chart for the mini SP from today, using 10000 volume charts. That means that each time 10000 contracts traded, a new bar will start.
Hope this helps and if you have any questions, feel free to email me.
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Trading Futures, Options on Futures, and retail off-exchange foreign currency transactions involves substantial risk of loss and is not suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.
|WedJul 17||Tentative||EUR||German 10-y Bond Auction||1.55|1.5|
|10:00am||USD||Fed Chairman Bernanke Testifies|
|10:30am||USD||Crude Oil Inventories||-1.9M||-9.9M|
|12:30pm||USD||FOMC Member Raskin Speaks|