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Footprint Chart & VWAP StrategyHere is a very practical way to read and apply the Footprint chart with the VWAP. I used the VWAP indicator (volume weighted average price) to provide levels of support and resistance, but really these ideas could be applied to any support & resistance or drawing tool on the chart. The video drives home many of the most important benefits the Footprint chart provides, especially when it comes to evaluating prices at known (and hopefully reliable) reference points. The idea is learn how to read the very important information that the Footprint chart provides. There are concrete examples in this 10 minute video that you should be able to immediately apply when using your MarketDelta. For more information on some of the indicators and things talked about, see any of these links. VWAP Strategy (Highest Quality Video)
VWAP Strategy using the Footprint Chart from MarketDelta on Vimeo. Trader XThe purpose of the Trader X series is to get a glimpse inside the minds of MarketDelta clients that are profitable traders. Each trader that we profile will have reported to us yearly net profits greater than $100,000. If you are interested in being featured in the Trader X series, please contact MarketDelta. Trader X Trading Experience: How long have you been trading? 20 years What do you enjoy most about trading? The challenge of it. I’m non-athletic by nature, but I feel like I can be the Michael Jordan of trading. Trading allows me to be competitive. In trading, I get to “be like Mike.” What do you like least about trading? Trading guru(s) who sell their systems and ideas for a whole bunch of money. What are the top 3 factors that contributed to your success? That’s easy. The top 2 are taped to my computer screen. Discipline and focus. I would say the 3rd is to be fluid or flexible. What weaknesses did you have to overcome? My discipline and focus…and bullheadedness. Trading Tools: How long have you been using MarketDelta? Over 2 years. How does MarketDelta best serve your needs? What trading strategies do you use (be as general or specific as you feel comfortable)? The Footprint chart allows me to read between the lines. I’ll share some specific setups that I use. I use the Developing Value Area (Hi, Lo, and POC) and the footprint chart settings. I setup my Footprint charts: I use the Delta setting. I have 2 Footprint charts and one profile chart (split blocks on a 405 minute profile). One monitors trades of 100 lots and above. The other monitors all trades. Then I look for chart patterns. For example: if there is consolidation above the DVAH, I see that there’s strength (click on the screenshot below for a larger view).
Every once in awhile these setups don’t work…but there are more winners than losers. Trading Education: What trading books, websites, or trading educators would you recommend? Trust your personal self. I spend 405 minutes in front of the screen most everyday. Develop your own feel. With that said, I recommend the Pete Steidlmayer and Ted Hearne 10 page primer. Understand the concept of staying and trading in one timeframe only. I do recommend the 2 month introductory course I took from Jim Dalton and Terry Liberman. They help a trader how to learn trading (rather than being taught). I learned how to be a better left (analytical) and right brain (intuitive) balanced trader through their teaching about how the brain works. Approximately how much money have you spent on external trading education? How many hours have you spent on education? 20 years times 405 minutes a day would be a good approximation. Trade Management and Goals: What advice do you have on trade and money management? Think in terms of probabilities. At the end of the day I know I’m going to lose $1000. With that mind set, I can then accept losing and take all trades. I also know I will make $2000 a day. Thus, that nets out to 4 figures every day…hey…that’s what it’s all about. Did you set trading goals up front in a very structured way, or did they just sort of develop as you became more successful? My goal is to be the best trader I’m capable of being and it’s still the same as years ago. I do not set monetary goals. Rather, I just let my right brain recognize patterns that show up in the ES over and over. The monetary “points achieved” will fall in place. Did you focus on good risk/reward trades? What timeframe do you trade? I consider myself a scalper and trade a one minute timeframe. I trade 20-25 times a day with 75 being my max. I look to take what the market gives me which can be from 1 tick to 10 points. I only trade the e-mini S&P but I have traded the SPY and some stocks. Pick a time frame and stick with it. I trade dinky 1, 2, or 4 lots. I am a good small trader of contracts and a lousy trader of large amount of contracts. Do you keep a trading journal? I print out “homework” each and every day to reinforce the right brain pattern recognition. See example below on how I best learn my right brain pattern recognition (click on the screenshot for a larger view).
Any final thoughts or bits of advice? An old floor trader friend Jeff told me you could give every one in the pit the exact hi and the exact lo for the next day and the majority will still screw it up. Understand the market and understand yourself. Do not beat yourself. Filtering for Institutional Trades on the Footprint ChartHere is a really useful way to setup the new Footprint chart and really make good use of the multi-pane functionality contained within it. This example shows a popular, compact use of having a Footprint chart that contains ALL the trade data reflected, along with another pane (bottom pane) that is showing only 100 lots or higher. Notice the filtered Footprint data reflects only the trades that were 200 lots or higher AND the Footprint Price Statistic (FPPS) that I added on the right side of the chart ONLY reflects this filtered data! This is a really nice way to see where the institutional activity is tending surface. The volume along with the delta for this Footprint (bottom pane) helps to give an idea which side of the market you should be trading from and helps to spot in realtime when the institutions are stepping into the market. Another benefit is this is very compact and makes good use of valuable screen real estate. New Enhancements to Profile IndicatorThe Profile indicator requires the Market Profile enablement, so you need an edition of MarketDelta other than Standard. The new enhancements make it very quick and easy to add volume profiles and volume distributions to your MarketDelta chart. It is a convenient way to quickly add Market Profile like distributions to you multi-pane chart. This includes Footprint charts, volume profile, point and figure, candlestick, bar, line, etc. Another benefit is the ability to have it start and end on what bars you select. This way you can measure volume during a breakout or any other period you may want to see. Watch the 10 minute video below to get a good overview of how to add it and begin making the most of this indicator. Other uses of the Profile Indicator can be found at the following links.
DTN IQFeed Upgrades to FIX/FAST protocolLast month IQFeed completed a major upgrade to their ticker plant that will provide MarketDelta users with a better user experience. This applies to electronic futures contracts from CBOT, KCBT, MGE, DME, CME, NYMEX and COMEX. Spreads, futures options and pit futures will remain on the older ITC protocol and IQFeed plans on migrating these later this year. WHAT DOES THIS UPGRADE MEAN TO YOU? WHAT DO YOU NEED TO DO? IF SWITCHING TO DTN Up/Dn Markers For PnF Periodicty FootprintFor those of you who relied on the small red and green icons in the classic footprint which denoted bars which started as up or down (in the reversal periodicities), here are two options to implement something akin to this in the new footprint charts. The first option, pictured below, makes use of the Color Marker indicator and an RTL custom indicator-
The chart definition is available from Charthub.com at this link. For those of you not on one of the Pro editions of MarketDelta, I have a nice workaround. What I did was to add a second pane with the SAME instrument and periodicity as the primary pane, but using the PnF style. Then I just squeezed the pane down very narrow, and the effect is not unlike the custom markers -
Please note: if you change the periodicty of the primary pane, you also need to change the periodicity of the secondary pane. If you prefer the “markers” on the top, just drag the pane up. Here is the chart definition link. Please let me know if any of you trying to migrate to the new footprint are having difficulty with replacing or finding functionality from the classic footprint. I’ll try and come up with a solution for you. |
