High volume trading strategy

Ask yourself how is the prospective asset performing relative to what was expected? When the Volume goes from negative to positive in a strong fashion way it has the potential to signal strong institutional buying power. When the volume indicator Forex goes straight from below zero to above the zero line and beyond, it shows accumulation by smart money. Chances are that institutions have more money and more resources at their disposal.

Odds can be stacked against you, so if you want to change that, just follow the smart money. Once we spot the elephant in the room, aka the institutional players, we start to look for the first sign of market weakness. Here is how to identify the right swing to boost your profit. Second, as the volume decreases and drops below the zero level, we want to make sure the price remains above the previous swing low.

This will confirm the smart money accumulation.

The Volume strategy satisfies all the required trading conditions , which means that we can move forward and outline what is the trigger condition for our entry strategy. Now that we have observed real institutional money coming into the market, we wait for them to step back in and drive the market back up.

When the Chaikin indicator breaks back above zero, it signals an imminent rally as the smart money is trying to markup the price again. We would need to wait for the candle close to confirm the Chaikin break above the zero line. Here is an example of a master candle setup. This brings us to the next important step. We need to establish the Chaikin trading strategy which is finding where to place our protective stop loss.

Never underestimate the power of placing a stop loss as it can be lifesaving. Never use a mental stop loss, and always commit an SL right the moment you open your trades. Trading with a tight stop loss can give you the opportunity to not just have a better risk to reward ratio, but also to trade a bigger lot size. Last but not least, we also need to learn how to maximize the profits with the Chaikin trading strategy. Once the Chaikin volume drops back below Use the same rules for a SELL trade — but in reverse.

In the figure below, you can see an actual SELL trade example. Any market moves from an accumulation distribution or base to a breakout and so forth. This is how the markets have been moving for over years. Smart money always seeks to mask their trading activities, but their footprints are still visible.

We can read those marks by using the proper tools. Here is another strategy on how to apply technical analysis step by step.

Forex algorithmic trading

Make sure you follow this step-by-step guide to properly read the Forex volume. The Chaikin indicator will add additional value to your trading because you now have a window into the volume activity the same way you have when you trade stocks. Please leave a comment below if you have any questions about the volume indicator Forex! Please Share this Trading Strategy Below and keep it for your own personal use!

Selected media actions

Thanks Traders! We specialize in teaching traders of all skill levels how to trade stocks, options, forex, cryptocurrencies, commodities, and more. Our mission is to address the lack of good information for market traders and to simplify trading education by giving readers a detailed plan with step-by-step rules to follow. Forex Trading for Beginners. Shooting Star Candle Strategy. Swing Trading Strategies That Work.

Please log in again. The login page will open in a new tab.

1. Volume Spread Analysis in Trading - Price Action Analysis.
2. urban forex pivot point indicator!
3. cara menghitung untung rugi forex;
4. forex scalping strategy adx.
5. how to make fast money with forex.
6. hdfc multi currency forex card login page.

After logging in you can close it and return to this page. Info tradingstrategyguides. Facebook Twitter Youtube Instagram.

The Forex market, like any other market, needs volume to move from one price level to another. This then lessens the likelihood of the trader making decisions based on emotion, rather than logic. There are numerous algorithmic trading strategies which can be adopted by traders in order to save themselves both time and money. This trading strategy involves a high volume of trades at a rapid speed in order to profit from small movements in price, typically trades will be open for less than a minute, and sometimes just milliseconds.

The aim of high-frequency trading is to make small profits, so there are often very high volumes of these trades occurring in one day. An example of high-frequency trading is scalping.

Arbitrage strategies involve using an algorithm to monitor the market to find price differentials. This could be useful if, for example, a stock is valued at one price on the New York Stock Exchange, but for less on the London Stock Exchange.

As these price differentials are often small, a large position is generally required to make a significant profit. Algorithms can be used to monitor the market and various price charts, identifying patterns which isolate the best time to execute a trade. The algorithm can base these patterns on trends that occur in both historical and current data, but trends can also be based on technical indicators , oscillators , price movements, moving averages and mean reversion. A mean reversion strategy makes the assumption that even if the price of a stock deviates, due to common factors like market news breaking, over time it will move back to the average price.

The trading range of the particular asset needs to be identified, then the computer can detect the average price using analytics. Typically, the average asset price is calculated using historical data. The VWAP, volume-weighted average price, is a benchmark that traders can use to execute an order as close to the average intraday price as possible.

You then keep a running total of cumulative TPV, and cumulative volume just adding volumes for each 1-minute period — or for whichever period the trader has selected , and then divide cumulative TPV by cumulative volume. It can, however, be used to gauge whether or not a trader has overpaid for an asset earlier that trading day. The TWAP, time-weighted average price, trading strategy aims to execute the order as close to the average price of the security as possible, over a specific time period.

This is often over the course of one day, and a large order will be split into multiple small trades of equal volume across the trading day. The purpose of this is to minimise the market impact by executing a smaller volume of orders, as opposed to one large trade which could impact the price. When trading the forex market , the efficiency of algorithmic trading means fewer hours spent monitoring the markets, as well as lower costs to carry out the trades. Algorithmic trading can also be useful when hedging trades, in particular, spot contracts, where foreign currencies are bought or sold for instant delivery.

Triangular arbitrage is one common forex algorithmic strategy. It involves trading different currencies in the forex market with exchange rate discrepancies, for an overall profit. This strategy involves three stages:. The strategy is conducted exclusively via a computer, partially due to the rare occurrence of these opportunities, but also due to the speed at which the trades need to be carried out.

A large amount of capital would typically be traded due to the fractional differences between currency prices. It should, however, not be used as a substitute for careful manual trading, nor should any associated risks be underestimated. Interested in algorithmic trading? Find out more about our MetaTrader 4 platform.

Disclaimer CMC Markets is an execution-only service provider. The material whether or not it states any opinions is for general information purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is or should be considered to be financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by CMC Markets or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.

Their trading strategies do not guarantee any return and CMC Markets shall not be held responsible for any loss that you may incur, either directly or indirectly, arising from any investment based on any information contained herein. Experience our powerful online platform with pattern recognition scanner, price alerts and module linking. Start trading on a demo account. What is ethereum? What are the risks?