welcome to the video update for Thursday, March the 11th. Watch Trader Rick review a chart pattern we don’t see too often. In this case we are looking at a 9 minute crude chart that has what some call a parabolic pattern. Watch closely to see the characteristics of a parabolic move. This pattern could also be a power buy which is where price moves directionally in one direction then reverses and moves directionally in the opposite direction, taking out the low (in this case) of the original starting point of the upmove. It is an abc pattern and the ‘c’ wave will take out the ‘a’ leg low. Watch the video update for a better explanation and to find out the target IF this is a power buy.
Trader Rick walks you thru two chart examples of where it is important to monitor volume. One is when volume surges after a lengthy move and the other is when price breaks out and is accompanied by volume. An ES chart is used to illustrate these two volume examples so don’t miss it.
Don’t forget Thursday is rollover day in the index futures (currencies too). Monitor volume to see when the volume moves from the March contract to the June contract, probably early afternoon. Trade the March contract until the volume shifts to the June contract.
Remember, if you trade a volume chart, you are taking in to account volume which is a leading indicator along with price. Do you the know the difference between a tick chart and a volume chart?
Good trading!
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Tags: rollover day, stock index futures, tick chart, volume chart
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