You really don’t need a ton of spaghetti lines and sophisticated whatchamacallits on your charts to spot when price is lying to you. You can use something as simple as Acme Volume Balance on a fixed-range bar chart (Range, Renko, etc) to assess the action in real time.
To quote a semi-famous Discovery Channel “survival expert” about staying alive in the wilderness with minimal gear:
The more you know, the less you need.
No matter how you feel about the person who said it, I think it’s so, so true in trading too. I’ve said it before and I’m going to keep on saying it. Price and volume are all you need.
This morning could you have seen the big crack in the ES coming? Maybe… maybe not. No one can predict the future. But you could have at least been prepared for a break before it happened. How?
Small steady rotations were rising but all the while the impulses of buying were waning, and the hanging tails below the zero line showed there were determined sellers and it might only be a matter of time before the buyers ran out of gas. Here’s what I saw…