Building on from Part 7.
The discrepancy between Time and Volume is when the POCs are not at the same level when comparing TPO and Volume data sets.
Weighing time and volume data can be indicative of both confluence and weakness.
For example: If time POC is different from volume POC it can point towards weakness.
When swing trading, both time and volume data can be used simultaneously.
Building on from Part 7.
The discrepancy between Time and Volume is when the POCs are not at the same level when comparing TPO and Volume data sets.
Weighing time and volume data can be indicative of both confluence and weakness.
For example: If time POC is different from volume POC it can point towards weakness.
When swing trading, both time and volume data can be used simultaneously.
While looking for VAL for example; if TPO shows a lower VAL than volume, then this would be the preferred selection.
That being said, both levels can be marked depending on your strategy. The main point is that you want as much accuracy as possible for your setup.
The majority of the time the POCs will align, on the occasion when they don't this can signal weakness or consolidation.
Key Points of the Lesson
UTILITY
Identifying discrepancies between Time and Volume can provide an edge.
Use the “furthest out” levels to identify the complete range for swing trades.
Recognize One Time Framing to avoid fading the price move.
IMPLEMENTATION
Specialized software: Exocharts or Atas.
Load standard CC TPO template.
Time and Volume POCs are shown ⇒ Activate special checkbox to show Volume-based Valua Area.
Generally, Time and Volume POCs line up.
A discrepancy between Time and Volume means the POCs are not at the same value.
This can indicate weakness in the price move or consolidation area.
Day trading ⇒ Use the daily TPO profile.
Swing trading ⇒ Use a large, merged set of data.
Always consider market context and check Volume, Delta, Open Interest and CVD Divergences.
Look for trapped traders at the volume POC when there is a discrepancy with time.
If price is spending a lot of time at the high of a move (creating a Time POC), but the Volume POC is lower ⇒ Indicates that the Volume is not matching the price move.
Generally, look to short the next rise ⇒ For example, a SFP of the consolidation area.
Confirm your idea by checking order flow.
ONE TIME FRAMING
A sequence of candles (or TPO columns) where the previous candle low/high is not broken during an impulsive move.
Can occur on any time frame ⇒ 30-minute time frame for TPO columns.
Very often backed by large volume (often squeeze) ⇒ Counter-trading the move is not recommended.
TIPS & TRICKS
When using Time vs. Volume discrepancies in day trading, use the session VWAP (mean volume of the day) as a take profit target.
Check the Volume POC area for trapped traders ⇒ High Delta, Open Interest, CVD divergences.
Trapped traders could lead to more pressure against them instead of a re-test of the Volume POC, which they could use to exit at break-even.
TAKE HOME MESSAGE
Consider fading the move when Time POC does not follow Volume POC.
Mark out levels using the “furthest out” price.
Do not fade a One Time Framing price move.