Zeta Volume Profile Pro

What is Volume Profile?

Volume Profile is an advanced order flow analysis which displays volume distribution at various price points over time. It may be called a recent biodata of a stock which is displayed on a chart as a horizontal histogram. Volume Profile can help reveal significant price levels where smart money is sitting.


Why Volume Profile is important?

The life of a Future Contract is of maximum 3 months. All the near month contracts expire on the last Thursday of the respective month. But, the traders who want to continue holding on to their winning positions would likely take the same position in the next series. So they often close the existing position near the expiry and take position in the next series. This activity is termed as Rolling Over the position and mostly it catches strength about 5-6 days before the expiry.


If we start tracking Volume Profile 5-6 days before the monthly expiry, we get to know the levels where maximum concentration of volume is located. In layman terms, we want to see where the biggest crowd is sitting. In this crowd, there will be equal number of buyers and sellers and when either party starts feeling the heat (market goes against them), they try to limit their loss by Buying/Selling and the random walks become a unidirectional march.

Zeta Volume Profile Pro tries to detect this crowd behavior by tracking maximum volume concentration area and when price leaves this area, it generates Buy/Sell Signals.



What is unique about Zeta Volume Profile Pro?


There are other volume profile indicators also in the market but Zeta Volume Profile Pro is unique in following aspects:

1. Whenever last Thursday of any month starts, Zeta Volume Profile Pro resets automatically and starts calculating volume and price levels from 30 bars backwards (default value which the user can change). Assuming we are looking at 30 Min. Time-Frame chart and your Stock Exchange opens for 6 hours a day, the last 30 candles cover 5 days data. If in your time zone, stock exchange remains open for longer hours, you can either increase minimum number of bars to be considered or you may increase your time-frame. The idea is you should cover 5-6 days of data on last Thursday of the month.

2. Once you set the minimum number of bars and time-frame relevant to you, leave everything to Zeta Volume Profile Pro. Now with every passing tick, the volume profile created by Zeta Volume Profile Pro will keep changing and more and more price bars will keep adding to the minimum number of bars set by you till last Wednesday of the current month occurs.

3. On any given day or time, whenever price breaks out of maximum volume concentration area, the indicator generates a Buy/Sell Signal and often such breakouts give handsome returns.


What markets it is suitable for?

It can be used in any time-zone on any stock exchange. However, since the concept is based upon Volume Concentration, it works best on highly liquid stocks, commodities, currency pairs and indices.

It will not give good results if the underlying security is illiquid because volume profile generated will not be efficient one.

Since Future Contracts volume tends to be more than cash segment, it gives much better results on Futures Charts.


Which time frames are best for this indicator?

Choose such time-frame and minimum number of bars which are equivalent to 5-6 trading sessions in your time-zone. In settings, there is an option to set your time-zone.


How to Take Buy/Sell Entry with Zeta Volume Profile Pro?


Whenever you see a Buy Signal appearing on your chart, take Buy Entry and whenever you see a Sell Signal, take Sell side Entry.

Your STOP LOSS would be high or low of candle which occurs just before the Buy/Sell Signal respectively.

Keep moving your STOP LOSS up as the price moves in your favor and when market turns around and you see a SELL signal, it is time to book your BUY position profit and take Entry on SELL Side now and so on.


What are the limitations of this indicator?


Sometimes price takes a break out of maximum volume concentration area and then again comes back which might hit your stop loss. However, as the backtested data shows, having faith in the indicator will give you some so nice breakouts that a single trade will cover your 10 to 20 Stop Loss hits.



How to get this indicator?

This is invite-only indicator. Get in touch with us using information given below in Signature field to try this tool FREE for 02 live sessions. After that, it is subscription based access.

Release Notes:

Increased Maximum Number of Bars to 1250 so that securities or indices which remain open 24 hours a day, are captured for the last 25 days at 30 min. time-frame.

Release Notes:

Updated code as per backtested strategy to improve signal timing.

Release Notes:

Changed Maximum Number of bars available to 1200.

Release Notes:

What is new in this version?

(a) Support/Resistance Lines Added
(b) Oversold and overbought indication
(c) Little Tweaked code which gives faster Entry/Exit

Release Notes:

Logic of Creating Buy/Sell signals tweaked further to reduce number of false signals.

Release Notes:

Fixed the issue which was causing missing alerts.

Release Notes:

Removed some conditions which were creating false breakout signals.

Release Notes:

1. Script upgraded to PINE Version 5.0.
2. Code introduce to detect and filter out unnecessary signals during side-ways movement.

Release Notes:

Updated the code to remove delay in signal generation in certain market conditions.

Release Notes:

Updated code to print indication for EXIT.