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Technical Analysis Topic
QUICK REVIEW OF TRADE PROFILE
(Another excellent eSignal, AGET add-on feature)
by Marc Rinehart, eSignal, Akron
'Trade Profile' is a proprietary AGET add-on study designed as
an internal data scan to identify areas of previous buying and
selling. These levels are then displayed as simple buy and/or
sell levels, or focal points. Traders should focus on 'thick'
and 'longer' levels. Thick levels are high volume areas;
longer levels are high price movement areas.
The theory states when a current price hits a previous sell
level we anticipate with higher confidence more selling
should again return to this area. When a price hits a previous
buy level, we anticipate buying to come in or continue.
Another premise behind this tool: a trader who sells at a sell
level may be stopped out of a short position if this sell level
is violated. We can anticipate with higher confidence if this
sell level stays violated it provides additional fuel for a rally.
If traders buy at a buy level they may be stopped out of their
position if this buy level is violated. If it stays violated it
provides additional evidence a decline continues.
Here is what I think is the tricky part. If a price fails to hold
a previous sell level, the previous sell level becomes support.
This provides a base for further rally attempts. Equally, if a
price fails to hold a previous buy level, the previous buy level
becomes a resistance area. It serves as a springboard for
further sell attempts.
One objection I have with Trade Profile-- buy and sell levels
show up and disappear with little or no warning. It is difficult
to anticipate well in advance when, where, and sometimes
how to really interpret these buy or sell levels.
The biggest concern I have is monitoring Trade Profile on
very short or day-trade time frames. That is when Trade
Profile buy or sell identification can really change quickly
with little warning. One moment it is there, later it disappears.
It is possible to change some of the Trade Profile settings
and gather the new information to fit the data better, but
who can determine which setting is most appropriate for
that action? I cannot easily discern which setting is most
appropriate after using it for many years. The slow price
change dynamics for a daily, weekly or monthly chart is
helpful when monitoring Trade Profile.
Trade Profile is an algorithm based on a calculation of
volume and previous key price movements.
Consider Trade Profile a nice secondary, supportive type
study tool. It is hard to strategize and make good trade
decisions well in advance if you are using just Trade
Profile to make a trade decision. Yet-- on the other hand--
Trade Profile is well respected enough to help fine-tune
an existing trading setup decision when other tools and
studies already are applied.
Don’t be afraid to use Trade Profile. It really does have
some very attractive qualities. It is simple and easy to use.
It quickly points out higher probability buy and sell areas.
I hope this helps better explain the eSignal ‘Trade Profile’
study, an AGET add-on feature.
If you would like to see some examples of Trade Profile
in action, review the charts and topic at this AGET Forum--
http://forum.esignalcentral.com/show...&threadid=4176
Better yet, if there are people out there who use this tool and
would like to share how you use it, this is a new thread to do so.
Sincerely,
QUICK REVIEW OF TRADE PROFILE
(Another excellent eSignal, AGET add-on feature)
by Marc Rinehart, eSignal, Akron
'Trade Profile' is a proprietary AGET add-on study designed as
an internal data scan to identify areas of previous buying and
selling. These levels are then displayed as simple buy and/or
sell levels, or focal points. Traders should focus on 'thick'
and 'longer' levels. Thick levels are high volume areas;
longer levels are high price movement areas.
The theory states when a current price hits a previous sell
level we anticipate with higher confidence more selling
should again return to this area. When a price hits a previous
buy level, we anticipate buying to come in or continue.
Another premise behind this tool: a trader who sells at a sell
level may be stopped out of a short position if this sell level
is violated. We can anticipate with higher confidence if this
sell level stays violated it provides additional fuel for a rally.
If traders buy at a buy level they may be stopped out of their
position if this buy level is violated. If it stays violated it
provides additional evidence a decline continues.
Here is what I think is the tricky part. If a price fails to hold
a previous sell level, the previous sell level becomes support.
This provides a base for further rally attempts. Equally, if a
price fails to hold a previous buy level, the previous buy level
becomes a resistance area. It serves as a springboard for
further sell attempts.
One objection I have with Trade Profile-- buy and sell levels
show up and disappear with little or no warning. It is difficult
to anticipate well in advance when, where, and sometimes
how to really interpret these buy or sell levels.
The biggest concern I have is monitoring Trade Profile on
very short or day-trade time frames. That is when Trade
Profile buy or sell identification can really change quickly
with little warning. One moment it is there, later it disappears.
It is possible to change some of the Trade Profile settings
and gather the new information to fit the data better, but
who can determine which setting is most appropriate for
that action? I cannot easily discern which setting is most
appropriate after using it for many years. The slow price
change dynamics for a daily, weekly or monthly chart is
helpful when monitoring Trade Profile.
Trade Profile is an algorithm based on a calculation of
volume and previous key price movements.
Consider Trade Profile a nice secondary, supportive type
study tool. It is hard to strategize and make good trade
decisions well in advance if you are using just Trade
Profile to make a trade decision. Yet-- on the other hand--
Trade Profile is well respected enough to help fine-tune
an existing trading setup decision when other tools and
studies already are applied.
Don’t be afraid to use Trade Profile. It really does have
some very attractive qualities. It is simple and easy to use.
It quickly points out higher probability buy and sell areas.
I hope this helps better explain the eSignal ‘Trade Profile’
study, an AGET add-on feature.
If you would like to see some examples of Trade Profile
in action, review the charts and topic at this AGET Forum--
http://forum.esignalcentral.com/show...&threadid=4176
Better yet, if there are people out there who use this tool and
would like to share how you use it, this is a new thread to do so.
Sincerely,