Use "leading" predictive indicators, rather than lagging ones.
While most retail traders use "lagging" price indicators, I was lucky enough to learn early from some masters in the industry, one must always use "leading" volume indicators, in order to follow the smart money.
Today, whales have more options than ever when it comes to silently placing orders. Learning how to spot divergence on weighted volume indicators is 100x more powerful than using any RSI, MACD, EMA...
This is because, while those popular retail indicators follow the averaged price of an asset, volume divergence is actually able to PREDICT market moves before they happen.
If the price is making higher highs, but the volume indicates a decline in buying pressure, then it's a good indication that while retail traders chase the price higher - a market reversal may be just around the corner.
The most basic leading indicator is the CVD.
The one above is a time-segmented weighted volume indicator.
Today, whales have more options than ever when it comes to silently placing orders. Learning how to spot divergence on weighted volume indicators is 100x more powerful than using any RSI, MACD, EMA...
This is because, while those popular retail indicators follow the averaged price of an asset, volume divergence is actually able to PREDICT market moves before they happen.
If the price is making higher highs, but the volume indicates a decline in buying pressure, then it's a good indication that while retail traders chase the price higher - a market reversal may be just around the corner.
The most basic leading indicator is the CVD.
The one above is a time-segmented weighted volume indicator.
Comment:
Cumulative volume delta is the difference in volume between aggressive buyers versus aggressive sellers.