In day trading, I like to analyze volume. Volume analysis forms the basis of how i approach each trading day. Volume can be analyzed in two formats. Volume at Price [VAP] and at Time [VAT]. VAP studies are key and help construct distribution curves or Bell curves that show volume distribution on any particular period. This forms the basis of profiling any market be it forex, stocks, metals or cryptos.
VAT [Volume at time] helps study impact of volume in successive 30 minute intervals. Delta studies as far as orderflow is concerned finesses all my entries. Timing is key!
VAP [Volume at price] analysis differ from ‘normal’ volume analysis because VAP analysis displays how much of something was traded at a certain price, versus during a particular time. I know this definition sounds confusing but we will break it down into two.
The two types of VAP studies namely: Volume Profile and Market Profile (Time Price Opportunity TPO). Out of the two VAP options, Volume Profile is perhaps the most well-known and accessible to many of us retail traders
A Market Profile TPO is different compared to a Volume Profile. A Market Profile is a more precise and definitely a more distinct form of volume analysis, as it has more distinct advantages than a VP – Volume Profile.
In my next posts, I will break down the two VAP & VAT studies. These form the bedrock on how I prepare for my trading day & week. Speak soon, stay safe & be very very happy always! 😉