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The third dimension of technical analysis: Capital-Intensive Areas

There’re some indicators shows the historial volume, like Depth Cluster Indicator in above chart, on the right it is the volume profile indicator. It is very similar to the volume profile indicator we see in the stock market. This indicator of volume distribution is still very meaningful, because it is a different market information.


Just like we want to do a set of analysis system and matching of technical indicators. You have to consider that if your indicators are all trend indicators, then it is of little significance to build trend indicators. If it is all energy indicators, it is not appropriate for you to do some stacking of energy indicators, then there must be trend indicators, energy indicators, and then volume indicators.

For indicators like chips, he can judge a relatively clear trading intensive area or a density of chip distribution. I think this angle is in fact irreplaceable by other indicators. Therefore, I personally prefer to use the indicator of chips as a reference.

In stock trading or exchange markets, because there are centralized exchanges that match transactions, all trading activities are carried out through the exchange. Therefore, it is easier to obtain the market profile indicator in stock trading. But in the over-the-counter market, there is no centralized exchange, the transaction data of each trading broker is different. Market profile indicators need to be developed by brokers, some brokers have built-in market profile indicators, some do not.

You may download the indicator there. Since some brokers are not providing depth of market data, and for copyright reason, it only works for selected brokers.



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