My personal interpretation of the Volume Footprint chart
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I signed up for an expensive plan on TradingView, but I think there are some parts of the chart that I can't use properly.
I think the Volume Footprint chart is a chart that can be used when you sign up for a premium plan. (I may be wrong, so please check.)
I think it's because I'm used to the old way, so I feel resistant to new things, and the explanation is difficult to read.
In order to solve that problem a little, I'd like to explain how to interpret the chart using only the core interpretation methods.
Since my explanation may be different from the creator's intention, I strongly recommend that you read the creator's explanation.
Volume Footprint Chart Description:
www.tradingview.com
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I think you should pay attention to and interpret the part indicated above.
I think the section marked as VAL, VAH is the section that is mainly traded.
Therefore, I think that depending on which direction it deviates from this section, it will affect the future flow.
Therefore,
- If it rises near or above VAH, it is likely to show an upward trend,
- If it falls near or below VAL, it is likely to show a downward trend.
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The next thing to look at is the column indicated next to each volume. (The part that the arrow points to)
- The column in the Sell Volume section indicates that it is a section with strong selling pressure,
- The column in the Buy Volume section indicates that it is a section with strong buying pressure.
(The creator explains that this is the part that is indicated by the imbalance of volume.)
Anyway, since there is a high possibility of a rebound or reversal in the part where this column is indicated, I think it can be a tradable section depending on whether it receives support or resistance in this part.
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The Delta section shows the difference between Sell Volume and Buy Volume.
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The time frame charts that are good for viewing the volume footprint chart are 1s, 1m, 15m, 1h, and 1D charts, so I recommend viewing them with the corresponding time frame charts.
If it deviates from the VAL, VAH area near 1, 1-1 and 2, 2-1 shown on the chart, a trend is formed, so you should check whether it deviates from this section.
If it does not deviate, it can be interpreted that there is a high possibility of sideways movement.
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Therefore,
1. Is it located near VAL, VAH?
2. Is there a section where columns are created next to Sell Volume, Buy Volume?
I think this chart allows you to detect the trading volume, that is, the movement of buyers and sellers, with the above two things.
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Have a good time.
Thank you.
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