Detailed chart analysis of past trading action
Identified where reversion and break-out trading occurred
The image below is the chart of Swiss Franc futures contract.
It is a multi-days chart showing Composite Time Price Opportunity (TPO) Profile on the left side
and Composite Volume Profile on the right side.
This is an unique charting technique and requires some explanation on how to read the chart.
This chart shows more information than the conventional graphical chart. Don't be overwhelm.
Once you get accustomed to reading this type of chart, it will stimulate your whole brain. The
left hemisphere of your brain which is responsible for logical, rational and analytical functions will
be engaged by the numerical data portion of the chart. The right hemisphere of your brain which
is responsible for the intuitive and subjective functions will be engaged by the graphical portion of
the chart. This gives you an advantage of engaging your whole mind when it comes to trading
instead of using just a section of it.
Showing
Time Price Opportunity (TPO)
Profile side-by-side to Volume Profile gives you a quick synopsis of
- which price levels received the most trading volume
- at what time during the trading session had it traded there
- how many times it had backfilled to those price levels
- where reversion trades worked for traders fading the move as price traded back and forth to form a cluster node
- see where and when break-out trades occurred as price spends very little time trading there
(Click on image below to bring up thumbnail and enlarge the chart.)
Legends:
- VAH = Value Area High
- VAL = Value Area Low
- POC = Point of Control (i.e. where most of the trading volume had occurred)
- TPO Count = Where trading has spent the most time
- VWAP = Volume-Weighted Average Price
- BOO = Break-out Octet. Minimum stop loss risk on false break-outs
- BDO = Break-down Octet. Minimum stop loss risk on false break-downs
- Each TPO letter represents half hour intervals
- TPO { abcdefghijklmnop } are the Asian Session
- TPO { qrst } are when both Asian and European Traders are awake, alert and online
- TPO { uvwx } are the remaining European Session
- TPO { yzVWXYZABCDE } are when both European and American Traders are awake, alert and online
- TPO { FGHIJKLMNOPQ } are the remaining American Session
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