|
|
What is difference between VPOC and POC?VPOC is the Volume Point of Control (volume based) POC is the Point of Control (time based) The VPOC relates to volume and POC relates to time. Both represent where the most trading occurred. VPOC is where the most volume occurred for the specified session or time frame. POC is the price at which trading spent the most time at. Very often people confuse time with volume and think that the price the market traded at the longest would have the most volume, but this is a misconception. Especially when looking at 24 hour charts, the POC does not necessary mean the highest volume price. If only viewing the day session, many times the POC and VPOC are very close or the same, but not always. Which is more important? – That is up to you. Some traders prefer the VPOC because it is more exact when inferring how much interest a particular price was for traders, both buyers and sellers. If you use Market Profile, it often references the POC. Our software, MarketDelta, can use both the VPOC or POC when viewing a Market Profile chart. If you visit www.marketdelta.com and search VPOC at top search box, you will get all sorts of good informtion. The Market Profile add on is required in order to plot the POC and VPOC. If you have any questions please comment or contact us. How to Plot the Developing VPOCThere is new piece of functionality in 10.5 that could easily be overlooked, but it is an important improvement for those who rely on the VPOC (Volume Point of Control) as a reference point. The new functionality allows for the plotting of the developing VPOC. The developing VPOC plots a line and shows the history and progression of how the VPOC has adjusted based on price and volume activity. Think of it as the history of where the high volume price has been over time. To add this to a chart first add a Profile indicator to a chart. Once added, make sure the top most setting in its preferences is set to “Price and Volume”. Then just check off the “Dev VPOC” box to add it to the chart. This will plot based upon what is set in the Time Per Profile section in the preferences. In the screenshot below it was set to 2 days, meaning the developing VPOC is plotted for the past 2 days.
Importance of “Fresh Start” for Non-time based chartsA lot of MarketDelta customers use non-time based periodicities (chart intervals) while viewing charts. There is an option on the periodicity menu call Fresh Start that applies to non-time based intervals and is very important to understand if using custom indicators or studies, such as our Delta Divergence indicator.
When Fresh Start is checked off the interval settings you have selected begin fresh for the day and do not carry over from the prior day. For instance, if the chart is set to 1440 tick, when the new day begins the chart begins building a new 1440 tick bar. If Fresh Start is not checked, the last bar from the prior day will keep building. For markets that gap this creates one large bar and as seen below, can really skew the signals produced by a custom indicator or signal marker. 
Bottom line, when fresh start was checked more signals where generated. For this specific chart, it was important because it references the low and high of the day. More information about periodicities and fresh start are available here. Our Most Popular Blog Posts of 2011As the year winds down, we were looking over what you thought to be the most interesting blog posts of 2011. We also wanted to include one from late 2010 that had lots of traffic and lots of comments. Most Visited Blog Post of 2011 Most Commented Blog Post of 2011 Winner for 2010 Forex Buy/Sell Signals with Delta DivergenceDelta Divergence is our commercial signal package for automatically generating buy and sell signals on charts using our order flow analysis tools. The signals are good in rotational markets as they seek to identify reversals when order flow moves opposite price direction, suggesting an imminent turn-around in prices. Traditionally, the Delta Divergence signals use Ask and Bid volume to measure the sentiment of market-priced trades. The Forex market is many times larger than the equities and futures markets – combined. Spot Forex remains one of the largest markets in the world and is particularly popular with short-term traders and scalpers. However, as this is a de-centralized market with no true “exchange”, there is no true and accurate volume information available. So, how can you use Delta Divergence on a market like Forex, if you don’t know Ask and Bid volume information? We provide the features to set our order flow studies based on “up tick” and “down tick” so you can compare the price ticks in a positive direction with those in a negative direction. This is a form of order flow analysis, but does not use the actual contract size of those individual trades and ticks. What are the results? Here is an example from this week on the EUR/USD spot forex instrument:
Click for a larger view.
Paint Bar for Cumulative DeltaA very useful indicator that is built into MarketDelta is called the Paint Bar indicator. This indicator allows you to either paint the actual bar or background of the chart based upon a set of conditions. The conditions used to “paint” the bar or background are defined in a scan, signal, or custom indicator. With all the powerful volume and price related studies in MarketDelta, the possibilities are almost limitless in the types of things you can “paint” upon. In the example below I have taken the volume breakdown indicator and created a signal to plot the background based on whether the cumulative delta is positive or negative for the current session. In terms of applying this information, you could use the cumulative delta as a confirmation for trade direction. If green, buy pullbacks, if red, sell rallies. A more aggressive way to apply the indicator would be to use a Footprint chart with the shaded paint bar background. A Footprint chart inherently provides more data than just a bar chart and will give a better idea of order flow. This means you can jump on breakouts if the order flow is present instead of waiting for pullbacks. Here is how to do it, or just download the chart definition here. Create the signal first. The signal is just VB>0. Next, add the Paint Bars indicator, choose Signal, and select the signal you just created. Choose to Paint Background. Click “View” to update the settings or just view how the signal is setup. Double click Volume Breakdown to see the settings for the “VB” token. Here is the result once added to the chart. Delta Divergence Chart SignalsWe are often asked about one of our commercial indicators, the Delta Divergence signal. As the markets have been particularly active the last few weeks, it is a good opportunity to see how order flow analysis has worked in this environment. Delta Divergence is based on a simple concept: If prices move out to new extremes of the session, but order flow moves in the opposite direction, this means actual trading activity favors a reversal. Because the Delta Divergence signals are specifically seeking tops and bottoms in the market, they are rotational indicators by nature. This means that during strong trending periods, they have a potential for failure. But trends occur much less than half the time, and even during multiple-day directional moves, there are often strong rotational moments within the intraday timeframe. The last couple of days, the markets have indeed rotated up and down, with strong moves in both directions. This “sideways” motion is the most common form of market activity (though usually the ranges are smaller), and it is an ideal setting for studying the Delta Divergence indicator. Click here for a screenshot of today and Friday’s 24 hour sessions, marked with Buy and Sell signals of the Delta Divergence indicator. As you can see, all five signals over the 2 days were profitable, and despite the volatility, the highs of both days were accurately captured by these signals. While the Delta Divergence indicator may not on its own dramatically improve your trading, many traders depend on it as an extra source of confidence when making decisions. Not all signals are successful, and it is up to the individual trader to decide how to best implement the Delta Divergence within a trading style. The Delta Divergence indicator requires the Professional version or higher of MarketDelta.
TPO Indicator, or Profile Indicator?While Market Profile charts are powerful and popular tools that appeal to many traders, MarketDelta also provides two indicators for viewing profiles on candlestick and Footprint charts. These are the “TPO Indicator” and “Profile Indicator.” The features of these two indicators at first seem similar, so you may find yourself wondering which to use. For example, with both indicators you can show information for the current day profile, or the previous day profile, or both. So what is the difference? The TPO indicator always shows data and profile levels based on 30-minute TPO letter durations. Thus, it closely matches what a true, traditional Market Profile chart shows. If you want to monitor Market Profile levels on your intraday chart, no matter what periodicity your chart is set to, use the TPO indicator. It will show the same value area and POC data as a Market Profile chart, no matter how your chart is organized. The Profile indicator draws value area and POC levels as well, but it uses the periodicity of the chart to determine the information. This primarily applies to time-based profiles, as opposed to volume-based. The cumulative volume for a price is going to be the same, whether you look at a 5-minute or 1.25 range or 1 minute or 233 tick chart. But the number of bars, and thus the number of times a specific price was charted, will widely vary depending on these periodicities. Thus the time-based profiles in the Profile indicator will not look the same as Market Profile charts unless you are using 30-minute candles or Footprints. Additionally, the Profile indicator offers many other features that are not available in the TPO indicator, such as long-term composites, the ability to split a session into up to three different profiles, and more. So it really depends on your needs and the type of precision you want to see in your profile results as to which of these two indicators you should use. Composite Volume ProfilesOne of the most popular features in MarketDelta is the ability to see volume distributions over a long period of time. For example, over the last 2 weeks or 2 years, where were the most-traded prices? Here is a quick tutorial. Using the Profile indicator, you can see this information easily. However, you must have access to good minute-based historical data, such as from DTN Market Access or IQFeed. If you do not have the price history on file, then you cannot view the composite volume profile. First, download as much minute data you need for the period you wish to study. In this example, I will look at the composite for the last year for the ES, so I start with a minute download:
Then, I look at any ES multi-pane chart, such as a footprint or candlestick chart, and change its view period to time period I wish to study:
After you are done, look back to the beginning of your chart to make sure it starts at the time that begins your study period. Finally, add an instance of the Profile indicator. One way to do this is to use the Insert button on your keyboard, then find the Profile indicator in the list. You will want to structure your Profile settings as follows:
You can also use the “auto peak” option if you want to have the indicator automatically create horizontal reference lines at the high-volume and low-volume nodes in the profile. You can adjust the sensitivity for this setting as well. Both options are near the bottom of this window:
When you are done, depending on your stylistic preferences, you will have a volume composite for the last year, like so:
Operating SystemsUpgrading from Windows XP Home/Professional 32-bitTo upgrade to Windows 7, the first step will be to backup your data. Microsoft requires that the hard drive be reformatted and configured for the Windows 7 Operating System in order to load the new operating system files. We recommend that you backup all of your files to an external hard drive before proceeding with the upgrade. Microsoft offers a program called “Windows Easy Transfer” which will help remove the complication of manually transferring your files through an automated less intensive process. To download, click here. For MarketDelta users running the Windows XP Operating System, make sure to manually backup the entire Mktdelta folder located in C:Program Files. The Mktdelta folder contains the data_f folder that is responsible for personalized charts, indicators and preferences. To determine which version of Windows 7 you should install, click this link on Edition Comparisons. Although the 32-bit version of Windows 7 is available, we recommend that you upgrade to the 64-bit version regardless. Commonly asked questions as well as technical references regarding the 64-bit architecture will be discussed further is the remainder of this article. To determine if you PC’s hardware, devices, programs and whether or not your system supports the 64-bit version of Windows 7, run the “Windows 7 Upgrade Advisor”. To download, click here. For More Information on the Full Step-by-Step Process on Upgrading to Windows 7, click here. Why choose a 64-bit Operating System?The main advantages to running a 64-bit Operating System is the ability to address greater than 4 GB of RAM and the ability to process twice the amount of data at a time. Previous versions of 32-bit Windows such as Windows XP 32-bit were only capable of addressing approximately 3.5 GB of memory. Rendering intensive tasks such as video/photo, music and mathematics benefit from 64-bit because the ability to address more than 4 GB of memory and process a larger amount of bits per processing cycle. In general, a PC running a 64-Bit Operating System with 64-bit applications will in general feel much smoother compared to a 32-bit environment. A user will notice that 32-bit applications run smoother on a Windows 7 64-Bit operating system because the PC is able to take advantage of using more than the 4 GB of memory for the other applications running on the system. For example, If your PC has 8 GB of memory and a 32-bit application is using all 4 GB of the memory that the architecture can take advantage of, the remaining 4 GB can be used for the Windows 7 system process including other 64-bit applications that can take advantage of addressing the additional memory. Will 32-bit programs run on a 64-bit computer?Yes. Microsoft has included a technology called WOW64, which is a subsystem capable of running 32-bit applications on a 64-bit Operating System. Additionally, users should know that although a 32-bit application can run on a 64-bit Operating System, the program is still limited to the constraints of a 32-bit software environment. A 32-bit application is capable of addressing 4 GB memory total. The 4GB allocation is divided evenly into two parts, with 2GB dedicated for kernel usage, and 2GB for application usage. Each application receives its own 2GB, but all applications have to share the same 2GB kernel space. Where to buy Windows 7 64-Bit?A copy of Microsoft Windows can be purchased at any retail store or online. Make sure to buy the OEM version of Windows 7 64-Bit which is simply the Manufacturer version of Windows lacking the retail box and documentation. There is absolutely no difference between the Retail or OEM’s version. Click this link to be transferred to Newegg where an OEM copy of Windows 7 64-Bit can be purchased. The cost is significantly reduced when buying an OEM version of Windows. Is MarketDelta compatible with a 64-bit Operating System?Yes! The MarketDelta program is a 32-bit application that has been updated to work seamlessly on a Windows 64-bit Operating System. |
