Tradestation comprises of three fundamental concepts in trading without which success can’t be achieved. These three concepts are price action, volume and real time support with resistance. Each plays its vital role in tradestation but among them price action is the most pivotal.
Starting from the price action; one has to embed this in mind that trading without price and time will incur losses for you and leaving you no where. Price in the market is always correct and there is no magic want to rule it by all traders. Often different indicators are used but market decisions are always based on the price action prevalent in the market. Traders use sheathing indicators in their trading decisions but they prove to be a failure and result in losses.
Next is the volume in tradestation. If classic indicators of volume are used then it makes it difficult for the trader to understand its functioning in trade process. For an example if we take stock trading one may find huge inflow of volume as the market was closed all night. The next day it’s really tough to figure out the unexpected spikes indicated through the average indicators of volume. At noon traders will be in depression and will be adjusting their volume spikes till the market closes in the evening. You can hardly make sense of average volume when you analyze the market spikes the whole day. As a result a false picture of market volume is seen and the traders get confused.
Moreover, if traders change the timeframe of trading chart then different volume information will be indicated as different time duration will show up unusual volumes. It is not workable even in forex market. The volume will be quite different as the trader moves from one symbol to another in tradestation. Again it jumbles up the situation and makes it far harder to understand volume.
To understand volume in tradestation, the best indicator of all would be time segmented volume. It will help you to compare the current slab with previous slabs of exactly the same time frame over the last month. With time segmented volume you may compare one trading month of 21 days of the same time slab you choose. It depicts the true average percentage of each time slab over the past 21 days. This time segmented volume then becomes normalized indicator. This will hold true for all charts, symbols and time frames. Time segmented volume when normalized is the most authentic indicator when comparing days among each other.
In tradestation when you compare candlestick bar with the volume bar you look for either consistency or deviation in time segmented volume. This helps in analyzing the trading patterns. On the other hand if you compare volume with price action then valuable trading information can be taken. . This is of the vital importance to comprehend the volume first and then making a comparison between time segmented volume bars with the candlestick bar. Having complete overview of the three concepts of tradestation on may take fast and accurate decisions eventually earn profits.
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