Following on from Chart Types Part 2.
This is the final tutorial on Chart Types.
Time Stamps
4:31 – VOLUME CHARTS
- Volume chart prints new candle after a specific amount of volume has been reached
- For instance, when you select Volume 10M there will be a new candle printed after the candle reaches 10 million transactions.
- This chart type can be used in combination with footprints, imbalances and delta cluster candles
- They are a great way of seeing when momentum is picking up but on a trend reversal type they are not so useful because you cannot see the wicks
8:26 – DELTA
- Delta charts print a new candle after a specific amount of delta has been reached
- They are useful to monitor when you want to see incoming market orders (they move market)
- This concept is a bit simpler than other types (yet very useful)
10:48 – TIME
- Time is very valuable as you can see how much time is required to print a new candle. You can easily spot when the volume is picking up because you see candles forming faster.
12:32 – EXAMPLES
- When you look at the volume chart and bars are becoming larger and larger it shows there is less liquidity (price just ‘slides’ through) and volume is bad
- Zeros on the right side indicate there are no buys which means no liquidity – OI shows the same
- When candles start being smaller and more compressed and price approaches a key level, it shows move is more reliable – there is more liquidity
- It is impossible to determine the low but it is possible to determine whether the price will break out or not when you look at the volume chart. When candles are being printed in short(er) periods of time it signifies there is a ‘volume injection’.
- Mike likes to use 10M volume bars
- When the price is reaching a key level, you can see where in candle delta is taking place. Then you can see if there are any trapped traders for instance. Volume chart is nice for scalping.
- Delta charts can take a little longer to form because a new candle is created only when there is either a negative 5M delta, or positive 5M delta (if you look at D-5M)
- You can determine whether an attempt to break a high/low is strong or weak, seeing how fast the delta candle was printed. Mike also likes to see how many trades took place in that candle and how many of them were buys and sells. Fewer trades mean bigger orders.
41:28 – RECAP
- Mike sums up all the chart types he covered to this day
- Range, range-y, tick, trend reversal, volume, delta chart
45:18 – ADD MORE COMPLEXITY
- When you master all these chart types you can add more complexity
- There is no best chart type. It all goes down to personal preferences and the type of trader you are.
- You can add OI, delta, CVD as they give you additional clues
54:09 – LINK/BTC PREVIOUS COTW (DO NOT TRADE THIS)
- Such a technical coin
- There is always a time and place to be aggressive on a trade
1:07:40 – Q&A
- Mike sometimes switches between different chart types when monitoring PA
- When you see the price coming up on very high volume and delta and see OI crashing down that indicates a stop hunt. After that price might be rejected hard or a range might start forming.