I am starting this thread as a continuation of discussion started in
Something I mentioned in the webinar was how I watch for consolidation areas as opportunities for entry as long as there is increasing volume in the direction of price movement. Well, I've continued that but have found that I can miss a lot of entries that way. I seem to be late. It's worked ok but just felt like I had to watch too closely in order to get the entry. I was listening to a webinar by FuturesTrader71 and he mentioned something that seemed to strike a chord. He said the low volume nodes test, reject, and move while high volume nodes are an indication of indecision by a lot of traders or something like that and have a tendency to bounce around a while. So, more care is needed. I think that accurately paraphrases what he said. I looked up the definition of low volume node and found it to be a market profile term. I'm not using market profile or volume profile for that matter which is why I titled this thread "Low Volume Areas". I don't want to use a term incorrectly and I don't know enough about MP or VP to use the terms associated with them. So, what I am doing is looking at low volume areas as shown by my Volume Accumulator. I'll attach it for those who want it. That's the only indicator I've been using for a while. But now looking at the low volume areas shown by that indicator as opposed to watching specifically for consolidation areas as shown in the price panel. I think these low volume areas actually give me better opportunities for entries than the consolidation areas did.
I am switching from CL to 6J for discretionary trading. Still new to 6J but it looks like it may be a better market for me than CL. It moves pretty well and seems to be less emotional than CL. So, here's what I'm doing. I watch for decreasing volume as shown in panel 2 which gives me an indication that I may be heading to a LVA. Wait for volume to bottom out so to speak and keep an eye on price. When I see price start to move in a direction with volume still in that LVA, I expect volume to start picking up and when I see price break a swing then I entertain an entry. If you want to get an idea of what I'm talking about, import the indicator and put it on a 5 second chart. Suggest not using CL for the moment but use another market like 6J and 6E. Then look at those LVAs and see what price is doing on the 5 sec chart. You should see some pretty clear breaks of swings in those LVAs. Profit taking can be at the High Volume Areas (HVA).
Take a look at the blue boxes on the chart and you should see what I'm talking about. Some LVAs aren't as clear as others but maybe you'll get the idea.
So, in summary, I watch for decreasing volume in anticipation of a LVA, then switch to watching price action in that LVA for a potential entry.
I'm still new looking at my chart this way. Same chart I've been using for quite a while but just looking at it a bit differently. Hope to get some feedback from more experienced "guys" out there.