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VWAP explanation, description and usage examples.Hello Traders:) Enjoy this small tutorial about VWAP 1. Definition: VWAP is a popular technical indicator used in trading to assess the average price at which a security has traded throughout the required time range, weighted by the volume of each trade. It provides a reference point for traders to evaluate whether they are buying or selling at a favorable price relative to the average market price. 2. Using VWAP: - Trading Decisions: Traders use VWAP as a benchmark to make informed trading decisions. They may aim to buy when the current price is below VWAP, indicating a potential value opportunity, and sell when the price is above VWAP, suggesting potential overvaluation. - Order Execution: VWAP can help traders with large orders execute trades efficiently. By splitting the order into smaller portions and executing them at intervals close to the VWAP, traders can minimize market impact and obtain more favorable prices. - Identifying Trend Strength: VWAP can be used in combination with other technical indicators to assess the strength of price trends. When the price consistently stays above VWAP and VWAP slopes upward, it suggests a strong bullish trend, and vice versa for a bearish trend. 3. Different Types of VWAP and their purpose: - Intraday VWAP: This calculates the VWAP over a single trading session, typically from market open to close. - Rolling VWAP: It calculates the VWAP over a specified rolling time period, such as the past 20 days, providing a longer-term average. - Volume Profile VWAP: It calculates the VWAP for specific price levels within a range, giving insights into the distribution of volume at different price levels. - Additional option available on TradingView: Fixed Range Volume Profile. We can set the VWAP from literally any time and select only part of the intraday session. Useful, for example, to track your VWAP trade from the start of our trade. This allows us to determine the strength of the trend during our open trade. 4. Settings for Different Purposes: - Timeframe: Traders can choose different timeframes for VWAP calculations based on their trading strategies. Shorter timeframes (e.g., 5-minute or 15-minute) provide a more granular view of intraday trading, while longer timeframes (e.g., 1-hour or daily) capture broader trends. - Volume Weighting: Traders may consider using different volume types, such as total volume, buy volume, or sell volume, depending on their specific objectives and the information they want to incorporate into the VWAP calculation. 5. Visual Possibilities: VWAP can be plotted on trading platforms as a line or a ribbon overlaying the price chart. It is often displayed alongside other indicators, such as moving averages or Bollinger Bands, to provide additional context and facilitate analysis. 6. Additional Ranges of VWAP: - Standard Deviation Bands: Traders may add standard deviation bands around the VWAP line to identify potential overbought or oversold conditions. These bands help highlight when the price is deviating significantly from the average and can signal potential reversals or mean reversion. - Multiple Timeframe VWAP: Traders may plot VWAP calculations for different timeframes on the same chart to gain insights into intraday and longer-term trends simultaneously. This allows for a comprehensive view of price dynamics across different time horizons. Remember to adjust the settings and interpret VWAP in the context of specific trading strategies, market conditions, and the characteristics of the securities being traded. Additionally, it's recommended to backtest and validate any trading strategy before applying it in live trading. If you enjoy this tutorial please follow for more content and live trading:) At the end example of how I am using VWAP with Heikin Ashi on BTC:
BITSTAMP:BTCUSDEducation
by Vezzeris
2
Fundamentals of Elliott Wave Theory + Briefly about the typesThis wave theory is based on the psychology of groups of individuals and statistical patterns. Every market decision is generated by meaningful information and simultaneously generates meaningful information. Each transaction being a result, becoming known to investors, joins the chain of causes of people's behavior (not news drives prices). The price movement in the same direction as the trend of a larger scale develops in 5 waves. Correction - reaction against a larger trend, developes in 3 waves Imagine a mango plantation. At the initial period, there is a bullish trend on the plantation stock exchange, which is obvious to the rational majority of mangoes (1/4 of the 3rd wave or 1/3 of the 3rd wave). Because of the confidence that tomorrow will be better, some very rational fruits began to borrow a little in order to earn a little more. This action of very rational fruits caused a faster increase in stock prices (because there is more demand). After learning about the "easy" success, the less rational mango decided to do the same, but since it is not very rational, it invested more. This pattern continued to the most irrational fruits. At the same time, with an increase in the circulation of capital (or monetary base), the borrowing rate falls (because there is a large supply of money in the market => corporations are valued more, they can issue more bonds => receive more money for business development (and not only)(This development is planned at a low rate => zombie corporations appear, and more risky projects are also being taken (not only by corporations, but also by people))). Spending by an average citizens also increased. When speculation, fraud, financial crimes reach a noticeable scale, rational mangoes will start to short, other mangoes will think - Why is this rational mango shorting (the hypothesis of an efficient market)? => The 4th wave will begin (little by little the fruits will begin to notice what is happening). When we reach the end of the 4th wave, the most irrational fruits begin to enter the market because of this, the 5th wave occurs ( the deceived themselves found pleasure in deception), At the end of the 5th wave, most likely, some famous fruit economist would ask the fruit society - what's going on? => panic will begin, because everyone will suddenly want to short + "stops" will work => correction will begin. Waves - more details Diagonal triangles (wedges) are the only 5-wave structure aligned with the main trend within which wave 4 almost always invades the price territory of wave 1. In rare cases, a diagonal triangle may end with a truncation (form 3-3-3-3-3).The final diagonal triangles (Appear first of all in the 5th wave at those moments when the previous movement has gone too far and too fast)A small part of the final diagonal triangles appear in the wave C at the A-B-C models. In all cases, they are found in the final waves of larger models and indicate the exhaustion of a larger movement. Triangle (3-3-3-3-3)-three tapering variants (ascending, descending and symmetrical) and an expanding variant, reverse symmetrical. Triangles always occur in the position preceding the last of the acting waves in the model, the degree of which is one more, in addition, a triangle may appear as an acting model in a corrective combination, but even then it usually precedes the last acting wave in the model, the degree of which is one more than the degree of the corrective combination. When it appears on the stock market in the position of the 4th wave, then the fifth - fast -> protracted. Growing impulses of degrees above the intermediate, appearing after triangles in commodity markets, usually turn out to be the longest in the sequence. Alternation — At the next appearance of a wave similar in nature, one should always expect a different form of it. Depth of corrective waves - corrections tend to show a return of prices to the price range of the previous fourth wave ( a lesser degree), usually to the level of its end. If the 5th wave of growth is stretched, then the subsequent correction will be sharp and will find support at the minimum level of the wave 2 of stretching (Sometimes the end of the correction, but in the some cases — the end of wave A => C wave). Equality of waves (two waves in a 5-wave sequence will tend to equality in time and magnitude (unstretched). Puncture of the upper boundary - If the volume has decreased, then the wave will end at the level of the upper boundary or will not reach it. If the volume is significant and the 5th wave approaches the upper trend line, a puncture is possible (near the puncture point, the 4th wave of a small degree can make a sideways movement). In the investment field, it is more important to choose the moment to buy/short/sell than a certain paper. The wave principle is to some extent applicable to individual stocks, but counting waves for them is often confusing and has little practical significance (because the sea of drops owning registered shares is mass psychology, and stocks are one independent drops)(On average, 90% of all stocks move down with the market, 75% - up). The best Elliott models are generated by important long-term breakdowns of stretched lateral movement models. The impact of news An important analytical question is not in the news, but in the importance that the market attaches to the news.((1 and 2 — fear and discouragement, 3 and 4 -favorable news, 5 — less favorable) at the market peak, the fundamental background remains rosy or even improves, but the market, despite this, turns down. Negative fundamental conditions begin to increase again after the correction has already passed a significant part of its path. Practice News — lag behind the market in time by one or two waves Limitations of wave theory Low liquidity. Incidents not characteristic to the free market. Initially impossible business models Since many people see the same wave in different ways, we must share our knowledge and views with each other - it is necessary to become very rational fruits.
NASDAQ:METAEducation
by loco_mango
Eduational: Example of a descending broadening wedge. A descending broadening wedge is bullish chart pattern (said to be a reversal pattern). It is formed by two diverging bullish lines. A descending broadening wedge is confirmed/valid if it has good oscillation between the two upward lines . The upper line is the resistance line; the lower line is the support line. Each of these lines must have been touched at least twice to validate the pattern. NB: a line is said to be "valid" if the price line touches the support or resistance at least 3 times. This implies that the descending broadening wedge pattern is considered valid if the price touches the support line at least 3 times and the resistance line twice (or the support line at least twice and the resistance line 3 times). A descending broadening wedge does not mark the exhaustion of the selling current, but the buyers’ ambition to take control. The divergence of the two lines in the same direction (increase in price magnitude) informs us that the price continues to fall with movements that are increasingly low in magnitude. The sellers manage to make the price rebound on the resistance line but lose control after the formation of a new lowest point. The highest point reached during the first correction on the descending broadening wedge’s resistance line forms the resistance. A second wave of decline then occurs of more magnitude, signalling the sellers' loss of control after a new lowest point. A third wave forms afterwards but the sellers lose control again after the formation of new lowest points. During the formation of a descending broadening wedge, volumes do not behave in any particular way but they increase strongly when the support line breaks. source:Centralcharts
Education
by UnknownUnicorn3442968
5
XAUUSD WYCKOFF DISTRIBUTION EXAMPLEHello traders, we would like to share some value knowledge, about structure based mostly on Wyckoff schematics. As an example u have marked up area identify by us as Wyckoff distribution schematic to help u get deeper understanding about markets and printed structure itself. Please, scroll left and right chart to see multiple examples of accumulation and distribution schematics. Hopefully this will help u get some breakthrough in your trading journey. God bless u all.
FOREXCOM:XAUUSDEducation
by Snipers-Academy
2
GBPNZD WYCKOFF SCHEMATICS EXAMPLESHello traders, we would like to share some value knowledge, about structure based mostly on Wyckoff schematics. As an example u have marked up few areas identify by us on multiple TF to help u deeper understanding about markets and printed structure itself. Please, scroll left and right chart to see multiple examples of accumulation and distribution schematics. Hopefully this will help u get some breakthrough in your trading journey. God bless u all.
Education
by Snipers-Academy
GBPJPY WYCKOFF SCHEMATICS EXAMPLESHello traders, we would like to share some value knowledge, about structure based mostly on Wyckoff schematics. As an example u have marked up few areas identify by us on multiple TF to help u deeper understanding about markets and printed structure itself. Please, scroll left and right chart to see multiple examples of accumulation and distribution schematics. Hopefully this will help u get some breakthrough in your trading journey. God bless u all.
Education
by Snipers-Academy
EURNZD WYCKOFF SCHEMATICS EXAMPLEHello traders, we would like to share some value knowledge, about structure based mostly on Wyckoff schematics. As an example u have marked up few areas identify by us on multiple TF to help u deeper understanding about markets and printed structure itself. Please, scroll up chart to see multiple examples of accumulation and distribution schematics. Hopefully this will help u get some breakthrough in your trading journey. God bless u all.
Education
by Snipers-Academy
EXAMPLE for creating a Strategy! How to make money with TA! #1Hey tradomaniacs, most of all beginners out there (I was at this point aswell), don`t know how to create a strategy and trading plan and are not able to make money WITH the market. At this point, I just wanna give you an example and tell you why it`s so important to have valid signals and a strategy you can trust in. Emotions - The Cash-shredder Emotions are the reason why 90% of all retrail-traders fail! We, as a human being, are visceral still living in the Stone Age controlled by FEAR & GREED. That`s why we need pre-conditions whose undertake these responsibillitys and determine our trading. CONDITIONS are part of your Strategy and you should treat them like your BOSS telling you when to trade! This picture does not includ important things like Stop-Loss, Take-Profit, Risk-and Moneymanagement and so on.. THIS IS one EASY example for a TREND-FOLLOW-StRATEGY, which is easy to use for beginners. Don`t start with crazy shit like Gartley, S/H/S and other Patterns whose have extra conditions and things to know that you can`t know as beginners. I will tell you more about this in another post it`s late here in germany! ;-P I just want this to be an inspiration for lost beginners. Peace and happy learning Irasor trading2ez PS: Have at least 4 of 6 conditions!
KRAKEN:XRPUSDEducation
by Trading2ez
10
Education: The ascending wedge. BNBBTC ExampleThe ascending wedge is a pattern in price action that has an uptrend with higher lows and higher highs, however the lines that connect the lows and the highs are tightening. This usually suggests that bull strength is running out, as every rally running toward the resistance is shorter lasting and moves less in terms of price action. Ascending wedges can break to the upside as continuation, or to the downside as reversal. However they don't usually reverse the underlying, longer term trend. The standard target on a bearish entry on the break of the ascending wedge is the starting point. You can see in the BNBBTC example that the price reversed up very close to the same level that marked the start of the wedge. Sometimes the ascending wedge will break bullish, to the upside, but the chances of that are lower as the support line is rising faster - what this means is that if the price traded sideways, it would eventually break the support line and thus the bears need less strength to break that support line than what the bulls need to break resistance. In this example the ascending wedge is going with the trend, as BNBBTC is very bullish on the daily and weekly, as such the expected outcome of the ascending wedge is not a trend reversal, rather it is a retracement back down to the starting level and likely continuation to the upside in the medium term. An ascending wedge during a downtrend is much more likely to be a continuation pattern, and short term bulls that played this wedge should make their exit as soon as there is a close below the support line.
Education
by pablo.lo.rivadeneyra
How to trade bat-pattern in non-USD currency? Look at thisHere I am going to explain how to trade a bat pattern in non-USD currency pairs . let's use AUD/CHF last week for example As you can see in 4H chart, B point and D point are determined by the Fib retracemen of XA t. Expecially for D point, it need to be 88.6% of XA, the price can't go far away from it. This is condition 1. For the bat pattern, the final reversal point is around 88.6% of the large trend--XA, and the previous small correction trend (AB) should not exceed 61.8% of the XA . Therefore, the use of XA retracement can help us to judge whether B and D meet the requirements. For point D, this is also around 2.618 BC. 1.618-2.618 times of the BC leg of is satisfied. So in fact we look for the zone made up by the specific Fib rate . Only need to use XA retracement and BC multiple to find the overlapping areas. That's where we need to short. But what is more important is to check if there is a signal in the price that there is a strong resistance here and where the target is. Learn from the history, this is the important support and resistance after the Swiss franc 2015, as you can find by moving prices forward. Although the price pierced 88.6% XA, but the closing price was unable to stay above the level ., this is the actual signal of the price blocked! At the same time, the RSI indicator gave us a short signal. So the trade of harmonic is to look for the area where the price reverses and then wait and see what the price action is. Take the opportunity to short! The first target is usually at the A-D 38.2% retracement,.Here you can see the price near the point several times after the rebound, indicating the existence of support, I slightly increase of 5 points, as the target position. Then wait and keep patient.
Education
by yitiancai