Market profile indicator for МТ4
Many traders use "classic" technical analysis methods in market analysis and trade decision-making using standard МТ4 trading platform indicators. In this way they try to predict the price movement and earn on it. In my opinion, such a method of analysis takes place, but it is deprived of the most important element - stock exchange information. And it significantly reduces the chances of success.
In this training guide, we will understand how price levels at which a price reversal is likely to be expected can be predicted. We will talk about the profile of the market, the construction of which is based on stock exchange volumes.
The topic of the article is an interesting, useful but complex trading instrument in the race of any investor. The market profile helps identify the most valuable levels from which opening deals will be most beneficial. Would you like to determine the existence of a trend without error? Know the moment of crossing into the side corridor? See the best points to enter the position? Today we will try to tell about the method of technical analysis, which was at the origin of the formation of the financial institution, but has not yet lost its relevance.
Trading by market profile is similar to trading analyzing volumes, there is a lot in common between them, but there are differences. However, combining both methods can significantly improve the quality of warrant opening. Now we will not dwell on how to combine volumes and price profile. myforex Academy has developed unique training guides that you will learn how the market profile indicator for МТ4 generates revenue with volume.
A price profile is a tool in the form of a horizontal histogram that provides information about the most important places of consolidation of the value of an item. Transaction data is taken from the Chicago Stock Exchange and analyzes the volume of futures contracts.
The market profile for МТ4 identifies on the chart the places where the battle of bulls and bears was the most significant, or the largest number of contracts were concluded. The system in question determines the value of an item based on fair value. Fair value differs from the market price and includes about 70% of the average trade volume per weekly trading system session.
The market profile for МТ4 is suitable for short-term and medium-term work on a currency pair inside the day. There are many tools suitable for defining currency pair consolidation locations. There are both free and paid options. General principles of application and analysis remain. They are combined by a horizontal histogram and the information it provides.
We recommend that you select a market profile indicator based on your needs and financial capabilities. The Cluster Delta program is relatively not expensive, compared to its counterparts, but has a number of specific benefits. The main of which is that you will receive information directly under contracts concluded on the Chicago Stock Exchange. The cost of service is only 4, $4 per month.
To be able to use the market profile indicator, you must register on the software manufacturer 's website. After that download archive by link, according to the selected package. In it there will be seven programs: ClusterDelta Volume Profile, ClusterDelta Volume, ClusterDelta Delta, ClusterDelta VWAP, ClusterDelta dPOC, ClusterDelta CumDelta, ClusterDelta VolumeChart. They collect information about transactions made on Forex.
We have highlighted this tool because it is characterized by the quality and reliability of the information provided. The indicator market profile for МТ4 has a large number of customizable parameters, for detailed study it is better to pass the training guide on our site.
The program draws a red line where the exchange had maximum trading volumes, this place is called a point of control. Use the control point to open orders as well as to capture profit. The market profile shows the positioning of professional money, separating it from crowd volatility. The histogram is able to indicate levels of support and resistance, thus showing the boundaries of the corridor.
The exchange spends 2/3 of the time in balance. During this period, participants accumulate positions to achieve new local extremes.
The market profile indicator for the МТ4 provides the following key points:
POC (point of control) - the control point shows the location of the highest activity of subjects;
VAH (volume area high) - maximum trading range, calculated based on 70% of the corridor;
VAL (volume area low) - minimum trading range, calculated from 70% of the corridor.
The forex trading strategy of the market profile implies trading in segments when the currency pair enters the territory between VAH and VAL, and the higher or lower price relative to POC depends on the direction of the open lot. If after the previous period the rate was lower than VAL, return to the area between POC and VAL must be used for sales. Stop Loss in this case carry above VAH. For the growing trend, the situation will be mirrored. The entry point is located between POC and VAH on Buy, and Stop Loss is placed under VAL. Do not forget, the area for purchase is formed only if the previous trading period ended above VAH, and the cost began to decrease.
The market profile for МТ4 offers a wide range of uses. It significantly simplifies the trader 's work on analysis and calculation of places of opening of positions. During the period of pronounced impulse, the profile will not give information for the purchase of the lot. Only when the currency pair enters the side stage of accumulation will you be able to enter into profitable contracts.
Growth, like fall, can be imagined as steps. Let 's say you couldn 't use the first stage of accumulation and the course moved 150 points down, forming a local Low. The generated side trend will help to determine the market profile indicator for the МТ4. Remember, it is not the entire corridor that is taken into account, but 70% of the range. When a session opens between VAH and VAL, the area between POC and VAH should be considered as sales. The best fit is the use of delayed warrants, which can be installed exactly on the VAH line. For the bull trend, the situation is the opposite.
Further suppose, in a bearish market, the session opened with a course not inside the range, but rose higher. In this situation, the Sell Limit is installed on the VAL line, the previous price profile. A resident who does not trade on the strategy under consideration will seem that the delayed warrant we set slightly above the resistance, which recently acted as support.
As we can see, the market profile uses support/resistance, deferred warrants, Forex trading sessions, uses a standard deviation channel. This is not a complete list of sections of technical analysis that need to be owned. For all topics you will find additional information in the training materials on the pages of our resource.
The last possible option is how trading according to the market profile recommends entering the position when the value of the asset is charged above the previous day 's VAL line, but does not overlap the POC. In this example, we consider a downward trend. The sale area with the delayed warrant will be above the POC and below the VAH, and Stop Loss will be above the local maximum.
The technique considered gives possible variants for almost any case. It 's your job to learn how to use your knowledge properly. For confident results, go to myforex Academy and learn how to work that will make your weekly trading system a success.