Market Profile vs Directional Volume

Yesterday, I received an email from a client that just started using the Directional Volume indicator with market profile.  While the Directional Volume indicator looks a little overwhelming initially, the breakdown is simple:

  • Price action is incorporated into the volume indicator.  Highs are identified with blue volume bars.  Lows are represented by red volume bars.  Outside bars are shown as magenta volume bars and an inside bar is gray.
  • Each volume bar shows the cumulative volume of both buying and selling
  • The portion above zero indicates buyers.  The portion below zero indicates sellers.
  • The small hash mark (“-“) shows who controlled the bar as it closes (buyers vs sellers).

Market Profile vs Directional VolumeMarket Profile vs Directional Volume

As you can see, there is a lot of information packed into the volume bars.  However, it is the same information that is used in market profile and cumulative delta.  I studied cumulative delta for over 2 years but the one issue I had is that the information displayed is overwhelming and multi-tasking is a must.  Quite often I would miss a trade because I was busy analyzing the cumulative delta.  The more markets you trade, the more likely it is that you will miss a trade.  Therefore, I took what I knew and designed the Directional Volume indicator.

The client that sent the email has more than 30 years of experience trading the markets.  He has traded professionally, as well as his own personal accounts.  He is also a follower of market profile and footprint charts.  As stated previously, he just purchased the Directional Volume indicator.  Here is his take on the Directional Volume indicator with the Trend ATR and ATR support and Resistance indicators:

“I am a long time user of Market Profile and  the Fin. Alg. version of footprint. I have been running your Directional Volume indicator against Foot Print just to see how they compare. I am going to say that anyone scalping or day trading that doesn’t use ATR and Directional Volume together is crazy……..  I picked up on the value of Directional Volume quickly because I was running footprint against it .  I am getting the same info from Directional Volume as from foot print but in a simpler form, easier to interpret . Again , I know I’ve been doing this a long time but these two indicators will make anyone’s trading easier. I love volatile markets [gold, crude] and  using ATR and Directional Volume on them is great. Hope the new year is good to you. Take care.”

While experienced traders, using market profile previously, can simply purchase the Directional Volume and ATR indicators and probably understand them, most traders will need the training that is included in the TradersHelpDesk trading packages.  These concepts are taught in the online video content that is included in both the Silver and Diamond Trading Packages.  Plus, for those that need additional training, the Diamond Trading Package also includes 10 hours of personal mentoring with Gail.  Now is a great time to begin learning because the most active trading periods, January to March are coming up.

Required Disclaimer:
The following reviews have been submitted by actual customers. The testimonials may not be representative of the experience of other clients or customers and is not a guarantee of future performance or success.

About Gail Mercer

Gail Mercer, Founder of TradersHelpDesk, is a highly respected trader, trainer, author, and speaker residing in North Carolina. She has over 15 years of experience in trading and in the development of custom indicators.

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