Fixed Range Volume Profile, How do I use it?
Updated
I can say that Fixed Range Volume Profile is strong tool to determine targets and stop loss, POC point of control as per my research represent a central price and bar close price is turning around it, so when you assign take profit and stop loss as per it, you reduce the risk and have a plan B to manage your trade.
as you see in above chart for BTCUSD, we have trend line on daily time frame, I cut the chart to 3 successive zones representing 3 cycle, 1 cycle is from the trend to trend and applied "Fixed Range Volume Profile" on all 3 ranges/cycles, last cycle has not finished yet, and I show POC1, POC2 and POC3 prices.
I consider this line as central price for a range and we can see how price keep moving above and down POC1 & POC2 prices.
for the last range/cycle (not completed yet because it has not reach the uptrend line yet, we see POC3 = $30,200 and the current price $29,590 so price is under POC3 and we can guess it is going to trend at approximately $27,750, this is 1st hint.
2nd hint is to take "Fixed Range Volume Profile" for the all uptrend, did you notice it? I think the price is going to POC(all range) = $28,300 (support)
Now we came to the best part of our subject, the what if question and how to set up a plan?:
*what is stop loss?
we need a 1H bar close above POC3= $30,200+100= $30,300 (resistant) and we buy target $31,380 (you should know why!) and for stop loss, we need close price 1H again down $30,200
*what is take profit?
we can set $28,300 for safe and $27,750 if you want to risk a little bit, this is first target, but what if bar 4h close down POC= $28,300? here we can set a 2nd take profit at $26,400 (you should know why!)
this is what I wanted to share with you and I will be glad to answer your questions.
I did go short for BTCUSD this morning, enter price $29,165 and I set a take profit at $29,322 because I am working on 15 min timeframe.
as you see in above chart for BTCUSD, we have trend line on daily time frame, I cut the chart to 3 successive zones representing 3 cycle, 1 cycle is from the trend to trend and applied "Fixed Range Volume Profile" on all 3 ranges/cycles, last cycle has not finished yet, and I show POC1, POC2 and POC3 prices.
I consider this line as central price for a range and we can see how price keep moving above and down POC1 & POC2 prices.
for the last range/cycle (not completed yet because it has not reach the uptrend line yet, we see POC3 = $30,200 and the current price $29,590 so price is under POC3 and we can guess it is going to trend at approximately $27,750, this is 1st hint.
2nd hint is to take "Fixed Range Volume Profile" for the all uptrend, did you notice it? I think the price is going to POC(all range) = $28,300 (support)
Now we came to the best part of our subject, the what if question and how to set up a plan?:
*what is stop loss?
we need a 1H bar close above POC3= $30,200+100= $30,300 (resistant) and we buy target $31,380 (you should know why!) and for stop loss, we need close price 1H again down $30,200
*what is take profit?
we can set $28,300 for safe and $27,750 if you want to risk a little bit, this is first target, but what if bar 4h close down POC= $28,300? here we can set a 2nd take profit at $26,400 (you should know why!)
this is what I wanted to share with you and I will be glad to answer your questions.
I did go short for BTCUSD this morning, enter price $29,165 and I set a take profit at $29,322 because I am working on 15 min timeframe.
Note
it looks like we will achieve target $28,300Trade closed: target reached
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