Since I’ve been trading abbreviated days this week, I’ve mainly been using my scalping technique. It’s a simple setup I’ve gone over in the eotpro live room most days lately. I’ve described an early version of the setup in the forums and old blog posts. The only real difference is that I’ve changed up the support indicators a bit… so that I use my new volume indicator variant, and my custom paintbars. But the idea is the same… a tag of the rolling vwap and a small move.
Anyway, here’s three examples from the end of the day today:
The third one is a pretty loose example of “tagging” the rolling VWAP, but look at how well volume precedes the move down just before entry (as seen by the volume indicator in the bottom subgraph diverging sharply against price).
I have found the technique is especially effective when you scalp moves after big volume divergence on a larger-grained chart (like a 2584 share bar chart, or a 3/4 pt range bar chart). This is doubly effective if we are near support or resistance on a PnF chart. Things like that are even more evidence in favor of a probable swing in a direction. That’s how I’ve been playing it, anyway, with very high success rate (no losses this week, that I can recall… sound good?).
Barb’s Reversal indicator also had two wins today, though I didn’t trade them. Here’s the second example:
Very nice!