Bob Volman Price Action Scalping

[cha-ching]

The only trade I took was another SB right after London close and the news about Spanish Bank Stress Test Results. The spread was widened to 1.5 pip, but I guess I was a little trigger happy. Please comment if you find anything wrong. I think the trend is not good enough for a FB, and there's no DD. Maybe I should've bailed after that double top formed.

Ah I found that the shape of that SB wasn't quite like a micro-W. The candle after FB didn't re-test the first pullback low to the pip though it did test 20ema. It would've looked better if there's a small doji in between these two. I guess it kind of lacked buildup didn't it?

 

[shotgun77]

RB analysis of charts:
Must have a trend before range.
Analyze based on whether range reverses trend or
continues trend.

Reverse trend failures: small sample.
No pressure for breakout. Or weak trend prior.

Reverse trend successes: 80%
EMA flat or in direction of break.
If no EMA squeeze, ema may be guiding out.
Without ema help, some pattern shows clear sign of reversal action.
Dojis or tails near break helpful to show pressure.
Might get stopped out if forms narrow range without conservative
stop mgm.
Obvious outcome in hindsight but might be hard to see/take
in real-time. Strong trends require a lot of "reversing" action
before final break-out. If don't have, expect a retest (and
usually stop-out).


Continue trend failures: small sample.
No real prior trend or very weak channel trend. No pressure.

Continue trend successes: 84%
The majority of range breaks continued the prior trend (62%).
In an extended trend, if get shallow PB that builds the range, might
not have any squeeze or pressure. Look for ema to keep slope or to quickly
regain slope if loses/flattens.
A compressed BB may show squeeze instead of the ema.
Be patient. Sideways action can last awhile in range before
trend continues.
Pressure might not show until very end if barrier has not had
any tests during range formation. So may look more like a BB at this point.
If pressure is minimal, don't move stop too soon unless get a strong surge
out of range.

 

[BLS]

Ah I found that the shape of that SB wasn't quite like a micro-W. The candle after FB didn't re-test the first pullback low to the pip though it did test 20ema. It would've looked better if there's a small doji in between these two. I guess it kind of lacked buildup didn't it?

I think it's fine to trade it as an SB. The second pullback doesn't have to test the low of the first pullback to the pip. It's just unfortunate that it didn't work out. I think it could have been traded as an FB; prices did do a mini-breakout and the trend and pull back moves were one directional. I did not trade it myself because I'm always paranoid of price action after the London close. I also just seemed to lose focus after my trade hit target .

As to that IRB, I would not take it. As you noted, the pressure was bearish and the boomerang IRB's usually have prior evidence of the barrier holding up, which I don't see here with all the lower lows.

 

[BLS]

More charts from Bob. He noticed that some of us had problems adapting to this environment of increased volume and follow through, and just pulling the trigger when there's a good trade ( I definitely have this problem) so he sent more charts to help us out.

 

[stehlikpetrmsncom]

More charts from Bob. He noticed that some of us had problems adapting to this environment of increased volume and follow through, and just pulling the trigger when there's a good trade ( I definitely have this problem) so he sent more charts to help us out.

This is so awesome, I'm glad for these charts

 

[shotgun77]

ARB analysis:
Two types: cluster forms just beyond barrier line.
Diagonal pullback after range breakout.
Very hard to find good examples on stocks.
73% of pullback type

Cluster:
About 50% success rate. Hard to find pattern to successes though
so almost seem random.

Cluster failures:
Not a good range break - range not clearly defined.
No double pressure before break.
Doji cluster after break of clear barrier.

Bad trading on my part: Cluster on an IRB that needs a BO to reach target.
Cluster built before break of range barrier. Don't take as ARB on IRB before range break!

Cluster successes:
No great examples.
Two clear barrier lines near each other. Cluster forms around outer line.
Prominent prior swing High/Low and cluster forms around nominal new extreme with some
build-up prior to break.


PB failures:
Frequent stop-outs with 2-3 legs that tested deeper into range.
Some looked good and still failed.
Stand aside if a lot of 2-way action - bull n bear bars
intermixed 50/50 in range.


PB successes: 67%
Clean diagonal that makes a solid test of prior
arch or clear barrier line and stops around ema.
Needs a good solid break then a good solid pullback.
Even with "textbook" setups, can still get stop-outs on deeper retest.

 

[shotgun77]

More charts from Bob. He noticed that some of us had problems adapting to this environment of increased volume and follow through, and just pulling the trigger when there's a good trade ( I definitely have this problem) so he sent more charts to help us out.

Thank you, Bob and BLS! Greatly appreciated. Humbled by your generosity in aiding others.

 

[shotgun77]

Hi, all,
I put Bob's week 39 shared setups into a spreadsheet.
It struck me that there were no FB.
Only 3 SB and 1 should be skipped.
7 DD and a whopping 4 should be skipped leaving only 3 tradeable DDs.
5 ARB including 1 skip.
I didn't count the IRB/BB/RB. There were a lot of IRB. Where there was a choice in naming, I chose IRB or BB over RB.

I counted the number of trades that reached profit target - full and partial.
Sometimes it was hard to tell. If in doubt, usually I put it down as partial.

I've attached my spreadsheet in 2 formats.
If you add/analyze the spreadsheet data, please share your findings.

Total setups that reached full profit target were 30 or 24 depending on the skipped. Losses were 16 or 9 depending on taking the skipped setups.

 

[UnderstandingContext]

I just wanted to post my final post on this forum from my blog.

Learning To Trade Like Bob Volman.

I wish you all the best on your journey to becoming experts using Volman's style.

 

[shotgun77]

I tried to match up the trades taken or skipped on the forum this week with Bob's charts. But because everyone uses a different time on their chart, I didn't have much luck. I'd be interested in seeing how the forum is doing compared to what Bob found for the week. The spreadsheet has a number on each setup and you could use that for reference. If you give me the number on your trades and whether taken or skipped, I'd update the spreadsheet.

 

[cha-ching]

I tried to match up the trades taken or skipped on the forum this week with Bob's charts. But because everyone uses a different time on their chart, I didn't have much luck. I'd be interested in seeing how the forum is doing compared to what Bob found for the week. The spreadsheet has a number on each setup and you could use that for reference. If you give me the number on your trades and whether taken or skipped, I'd update the spreadsheet.

I count three active forex traders here: BLS, samich1262, stehlikpetrmsncom. Haven't seen vanica posting trades for a while. BLS and samich1262 trade London/New York overlap, while stehlikpetrmsncom trade the whole European session. I know BLS's time zone is GMT-7, Bob's is GMT+2. When I match my trades to others, I look at the 20-level first then the shape. I haven't finished my second round reading yet, so I'm skipping setups I'm not familiar with. I hope to catch up within in two weeks and follow your path to do some similar analysis, at least comparing myself and Bob (if he's kind enough to continue sending BLS the valuable charts!). Still there are far more trades he saw than I could possibly see in real time even if I become as skillful as he is -- there are more movements in European session before New York opens than after.

 

[samich1262]

Glad to see some more of Bob's charts, last week's set got me to pay a lot more attention to trend continuation and larger pullbacks. I think they are extremely helpful, really appreciate his time and input. I was really glad to see his take on those big moves on Friday. I wondered if I was missing setups on moves 2 and 3, but I didn't see an entry that looked safe.



3 looked like it could have been a bear flag but it broke too early to be valid. Not in the average, not a long enough pullback, no good BB entry. It was a good place to watch for a setup, but nothing tradeable appeared.

I skipped #4. Looking at it after, that was an obvious trade. I don't know why I didn't take it. Strong downtrend, retest of the 70 level, price is pushed back under the EMA... I took a similar setup earlier in the week that failed, but it was in a much weaker trend. That was me not evaluating and thinking too much about patterns. But overall, I feel like I'm starting to consciously shift more towards overall conditions. Still need a lot of "repetitions" so that it comes naturally though. Right now I'm consciously watching 00 and 50 levels, watching pullbacks and looking for trend continuation opportunities. I still don't pay hardly any attention to 20 levels, so I will try to add that to my focus for this week, especially after reading Bob's comments on last week's charts. I need to shift to where I'm aware of what levels are nearby at all times. I think I was able to spot about half of the setups that Bob showed us, but I was bummed at myself for only taking 2 setups this week. I am starting to get a feel for spotting valid setups and throwing out bad ones, so here's to hoping this week I can make myself get in on every valid setup that I can spot in time. However, during my backtest, I still took 2 or 3 of the aggressive setups because I wasn't paying enough attention to price action near the 20 level, so I definitely need to start being more aware of that.

I have found that I manage all of my trades the same way, but I think some trades require tighter trailing. One thing that I'm going to try to do this week is know going into a trade whether or not I need to trail tight or leave it more room to work. Seems like RBs that have weak followthrough require close trailing. Setups in a significant pullback often don't require as strict of management, depending on where they show up on the chart.

 

[shotgun77]

@samich1262
You have set yourself some nice execution goals for the week. Exactly like Brett Steenbarger and others recommend. As they say, focus on the execution and the PnL will follow.

 

[BLS]

I think I was too aggressive with my two trades today.

 

[cha-ching]

I think I was too aggressive with my two trades today.

Thanks for the charts. The missed ARB happened 8 minutes before news. Were you concerned about it even if your broker doesn't widen the spread during news? Or you only avoid NFP and Bid Rate? OANDA widened spread to 5 pip at release time.

I noticed your E2 as well, viewed it as DD but was intimidated by price breaking daily high as well as the double top (Though Bob had an example in the book where he disregarded the double top, Figure 14.9, page 266). If the buildup for BB in your chart were better maybe that double top could've been disregarded as well? For example, Figure 15.6 p293, last arrow vs. the skipped arrow.

 

[stehlikpetrmsncom]

Two trades today, traded much shorter time then usually, handled it much better then usually.

 

[BLS]

Thanks for the charts. The missed ARB happened 8 minutes before news. Were you concerned about it even if your broker doesn't widen the spread during news? Or you only avoid NFP and Bid Rate? OANDA widened spread to 5 pip at release time.

I noticed your E2 as well, viewed it as DD but was intimidated by price breaking daily high as well as the double top (Though Bob had an example in the book where he disregarded the double top, Figure 14.9, page 266). If the buildup for BB in your chart were better maybe that double top could've been disregarded as well? For example, Figure 15.6 p293, last arrow vs. the skipped arrow.

Bob says he doesn't worry about news releases unless it's the major ones so I'm trying to do the same (I do take note of all "high impact" releases as marked by forexfactory). I was a bit worried about that double top too but then I thought it was kind small. I would consider it an aggressive trade. I may have hesitated if only two bars formed before the break.

 

[vanica]

Hi,

Would appreciate any thoughts on entries and stop placement.

Thanks.

 

[stehlikpetrmsncom]

Hi,

Would appreciate any thoughts on entries and stop placement.

Thanks.

Can I ask what led you to re-enter on the second IRB since the first didn't work? I don't imply it's a wrong entry, but the second IRB is much smaller and runs into triple top, while the previous IRB only had double top in it's way, so I am interested in your thought process.

 

[vanica]

Main reason was that overall pressure hasn't changed and price stalled at the same support level (bottom barrier of the first block). After the first IRB failed I thought there could be quite aggressive selling because bulls couldn't crack the range. And if they didn't manage to squeeze the bears out it could mean the continuation of a ranging behavior. But when I saw the lack of selling and hesitation at the same level where buyers previously stepped in I thought it was an ok place to enter.