Trading tick chart strategy

This website needs JavaScript. Please enable JavaScript support in your web browser's properties. In few words, if you use the x ticks view tick combination with the classic intraday time-based view, you can enrich your chart analysis with the following advantages, providing not strategy different, but also more accurate information:. On the other hand, the tick view displays only one or chart candles during calm periods and avoids therefore an accumulation of small candles.

This makes the detection of trends much easier, since a zero-trend environment in the time-based view can change your support and resistance lines drastically and consequently your trading decisions. The 1 hour chart makes it impossible to identify where the trend will go or if it might change.

The only thing we know, is that it was the right decision to sell. In the classic time-based view, the volume shows only the number chart securities exchanged during trading given period. However, in the x ticks view, each volume bar represents the number of securities exchanged per candlestick. Since the number of transactions per candlestick is constant, each volume bar reflects the average volume of all transactions of chart corresponding candlestick. Let's see what that means in an example:.

Trading may expose you to risk of loss greater than your deposits and is only suitable for experienced clients who have sufficient financial means to trading such risk. No information on this site is investment advice or a solicitation to buy or sell any financial instrument. General terms of use and sale. Home Why choose ProRealTime? Trading with X tick charts: In the example below, we are using a ticks view. Consequently, each candlestick shows the price variation of consecutive ticks.

These two charts show the E-mini Nasdaq during the same time period, but the x ticks chart gives you five important advantages to sharpen your analysis! Clearer analysis Not time-based Confirmation of trendline breakouts Clearer signs when to exit the market Correlation between the volume and the strategy development. Let's zoom on the time period of April 23rd to April 27th and take a closer look at the candles.

If the market is active, the classical view might tick not be "fast" enough. Sharp drops and increases of the price will be displayed as one large candle, even if you tick a rather small view like 1 minute. You tick an example for this case in the image above. You trading see that tick the 2 hour chart strategy small candles common during the night and several long candles common during the day are displayed.

A trendline can be drawn between the 23th and the 25th, but will not indicate the trend change that takes place on tick 25th and the 27th. You would actually need to trading two lines, which makes it even more difficult to decide where the trend might go. In the x ticks view, the long candles are divided into smaller tick bars. A strong resistance line can be drawn from the 23rd until the 27th, which allows you to better understand the trend during these days.

We will keep looking at the same time period, but discuss another aspect of the candles in x ticks view. In times with only little buying and selling activity, like before the close of the market or tick noon, the classic 2 hour view will show several unimportant candles that will give you no major information as you can see in the bottom chart of the example above.

That is not the case in the x ticks view, which shows more candles during days of high activity and less during days when the market is calm. For instance, on the 27th the x strategy view displays chart candles while the day before it only displayed 16 candles.

As mentioned before, support and resistance lines can be very different in the two views. But what does that mean exactly? Let's imagine that we were trying to enter the market on May 4th if a bullish signal was confirmed. The image above shows a 2 hour chart and a tick chart, which display roughly the same amount of candles.

If we draw the main resistance trendline on both charts, we see that there is a significant break of the trendline on May 5th on the 2 hour chart. Many market participants might go long, assuming that this trading the start of a new bullish trend. In the x ticks view, the trendline holds.

If you had been looking at both charts, you would have most likely waited until you would have been able to detect a clear trend underneath or above the resistance trendline. Imagine you are trading the Euro Bund Future in real-time, with the information we have on the 25th at So let's take a closer look at the chart by choosing a 1 minute view and tick view as shown in the picture below. This drop, displayed as one long candle in the 1 minute chart, is divided into several smaller candles in the x ticks view: Chart 1 minute chart displays again one long candle at We sell and the market goes in the right direction for us.

A few minutes later, a trader that works strategy the 1 minute view only, is faced with two options: Unfortunately for this trader, both choices are only based on emotions. Imagine how frustrating it would be, if strategy had exited the market because you wanted to break even with your losses of the previous days, but the market actually falls much further.

On the other hand, imagine how frustrating it would be, if you had kept the selling position and the trend changed and you lost the money you just earned. Meanwhile, the fortunate trader that works with both views, can apply the results of his technical analysis to make his choice. For instance at He would exit the market at right time and increase his profit. It will give you no indication if the security was bought or sold by major players or private investors.

If you choose a 5 tick view, you could do the following calculation to find out about the value of the volume bar:. If you add the moving average to the volume chart as the blue line trading the example above and the volume bar is taller than the moving average, you can assume that the transactions composing this bar were generated by a larger investors.

These major players are generally more knowledgeable and about their chart than individual investors. In a trending market, this is often a sign of the continuation of the tred. Experience shows that a new high, like at point 2 in the example above, accompanied by smaller volume bars than those of the previous high, like at point 1, indicates that the bullish trend may come to an end.

At point 3 on this chart, some major investors are sellers and some are buyers. This causes a stagnation trading the short term and once the market decides to break the support, "small sellers" are active and make the price decrease.

In the past paragraphs chart presented you strategy advantages of the x ticks view by comparing it to the classical time-based view. The x ticks view shows many times a different chart than the time-based view during the same time period. This can help you when determining whether to go long, short, stay out of the market or even more important, exit your positions. In many cases the chart is clearer and helps you to apply technical analysis tools.

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