Understanding the market with Market Profile- A discretionary approach

[CreditViolet]

Propeled with facination of MP, i googled info on that and beside MP i got stuck with a littile new concept in trading namely "j-charts", which is very similar in looks with MP but different in construction and interpretation.
Idea behind J-charts and its rules of interpretation can be usefull for MP reader also. So have a look-n-read of these

http:// www. investopedia. com/articles/technical/04/060204.asp


http:// www. j-chart. com/

and one more

http:// www. asx. com.au/research/charting/library/j_charts.htm

[I thought to plot on real chart paper by tick data of NF, but i gave up on no. of tick data, perhaps some hidden guru on tj be already using j-charts with e-signal]

Aha, j-chart, hopefully its not a product of mine

 

[orderflow13]

Alex, Thanks for starting practicle discussion on Mkt Profile. Your post #31 on page 4,
is Gem for traders. It is possible to link this from first post of the thread so that it doesn't get lost in the discussion.

As a trader, we need to know how to us the knowledge of a subject in our trading.
Due to limitation of my TA software (metastock) I don't use MP now. I drew these profile manually but gave up after few months as it was time consuming.

Some of the ways that I found MP useful are -
1) Identifty the speed of price action. When price is withing VA, it moves slowly, but as soon as it goes out of Value Area, the moves are fast.
Helps in getting stuck in a trade during sideway or slow mkt during lunch time or on sideway days.

2) Shift of Value area in lower timeframe MP gives an idea about the developing trend in higher timeframe. If 5min VA is shifting upward, then it shows that view of market participants about fair trading price is shifting up. It can be used to visualise what is developing in higher timeframe 30m / 60m / daily/ weekly charts.

3) Giving strength rating to Pivot highs/ Lows. PH/PL falling out of V Area are weaker then those are formed within VAs. Helps in putting Stoploss at stronger price levels.

Looking forward for more input on trading MP from this thread.

Happy Trading

Thanks for writeups..I edited my first post and provided the link of post no 31, more suggestions will be welcome if it helps trading better.
I got that feeling also, most members r facing technical issues to understand market profile, but as u said u tried to note it down market profile manually until u tired and felt time consuming, i mentioned in one post that market profile is time consuming, if we willing to give time to understand market then this time should be worthwhile.. i posted the link of market profile calculator..whoever interested in MP and faces tech issues who can use that link and plotting 30 min/15 min MP of a day wont take more than 5min. ..in original book of dalton on profile he explain MP with the help of simple tick by tick chart, and we get the point what dalton wnat to say in terms of market profile..it might take more time to read the price and volume movement before we plot MP in our minds eye..but thats the goal, n thats why i wanted when i start this thread...
I am not sure 5 min profile should be used to track market movement it may cause whipsaws as well and picture might get confusing but there ant any rules it can be done if one is comfortable and understands it..MP started by CBOT using 30 min time frame..most intra charts i found r 30 min tf .but we evolve and adjust tf as per our need.More experience MP users comments will be interesting on it.
best wishes and looking forward for valuable write ups from other members as well.
Alex

 

[orderflow13]

1) SHIFTING OF VALUE AREA FROM 2775 TO 2720
2) But market profile still within previous profile, with open interest pcr ( substitute for volume behavior ) is rising which indicates limited downside, but long term time frames might have to test value below 2675 to check if there is active participation.

 

[orderflow13]

 

[orderflow13]

At first post of this thread, added the link of CBOT short term tutorial on Market Profile.

 

[orderflow13]

NF 30tf MP
profile getting elongated ...value area is below prev value areas, market in trend

 

[orderflow13]

shall close this thread now..it will be no more updated by me ... will not be posting anymore on traderji
bye and best wishes
Alex

 

[Traderji]

shall close this thread now..it will be no more updated by me ... will not be posting anymore on traderji
bye and best wishes
Alex

Thank You for letting us know.

Wish you all the best!