volume vs time bars

If anyone is using volume (contracts)instead of time charts I'd be interested in learning why.

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Originally posted by ruvan

If anyone is using volume (contracts)instead of time charts I'd be interested in learning why.

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By taking tim eout of the equation - you don;t end up with a lot of signals based on low volume or inactive bars. This keeps you out of trading choppy times and reduces false signals.

Plus tick or volume charts help keep trend lines intact during the overnight session.

Try 512Tick Chart on YM... Enter on the first pullback to the 8EMA AFTER a breakout with lots of rapid movement. This is a reliable way of getting in a big move that you are not in already or you already got out of and watched run away.

try 300v for YM and 3000v for ES, primary reason is to avoid death space during lunch time and chart will jump alive when vol starting to surge.

For 3000V for ES do you mean a 1 minute volume of 3000 contracts

quote:

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Originally posted by bakrob99

quote:

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Originally posted by ruvan

If anyone is using volume (contracts)instead of time charts I'd be interested in learning why.

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By taking tim eout of the equation - you don;t end up with a lot of signals based on low volume or inactive bars. This keeps you out of trading choppy times and reduces false signals.

Plus tick or volume charts help keep trend lines intact during the overnight session.

Try 512Tick Chart on YM... Enter on the first pullback to the 8EMA AFTER a breakout with lots of rapid movement. This is a reliable way of getting in a big move that you are not in already or you already got out of and watched run away.

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Thanks for your reply. I find there is a vast difference between tick and volume charts. You could easily have tick bars printing with little volume which doesn't make them as meaningful as a surge of volume moving price.

I trade ES, not YM, and would be interested on learning your thoughts for a setup whether using tick or volume charts. For some reason, traders like to use 233 tick on ES, but I have no idea why.

quote:

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Originally posted by ruvan

...I find there is a vast difference between tick and volume charts...

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Where do you find this ruvan? My correlation testing shows your comment to be false.

daytrading, just my observation from a lot of screen time; not hardly scientific or totally conclusive by any means. I've seen tick charts print bars like wildfire consisting of lots under 50 contracts and to me its noisy. Hence, my interest in volume bars.

I don't use pattern recognition, so time charts are of no value either to my current setups. I'm more of a price action trader and moves with big size behind them have more meaningful information in my view.

I agree that volume charts are the best and theoretically they are far superior to tick charts because of the danger of manipulation (accidental or intentional) that tick charts can suffer. However, in reality they have a 95% correlation and can be used interchangeably although I never use tick - only volume.

Volume charts are, as you say, streaks ahead of time based charts for pattern recognition and almost any other type of trading signals.

Have you read this on Chart Types?

daytrading, no I didn't read that page until you posted. What a coincidence our thoughts are on the same lines.

even volume charts have their issues imo

so you are not constraining your chart by time anymore, instead you are constraining it by volume, you have to ask yourself what edge that gives you

if you were to ask me which charts I think are the best charts for filtering out noise, my answer would hands down be point & figure (japanese reversal charts are fine too)

if you were to ask me why...my answer would be...

it is quite simple, I trade to make money so I am concerned about price action, I am not highly concerned about volume, I am not highly concerned about time, I am concerned about my entry price and my exit price and the price action that guides me...so for me there is no better chart than one that shows pure price action

just my .02

If that's the case, why use a chart at all? Just look at a realtime print of prices.

yep, you will see a lot of that tick charts based on some a fib numbers, I used to look at volume charts based on fib numbers but just started going to round numbers on it heh