The Power of 3 - A Volume Imbalance Pattern to Watch For

Thanks to Don from Wolfpack Trading for sending in this trade example using the Volume Imbalance Footprint chart showing the ES. I have noticed that it is quite common to get a three green signal and there is a decent momentum move after that.

I went to the movie Captain Phillips last night and heard the Navy Seal talking about "one green, two red" and then he finally got the "three green" signal and they executed.

Thus, I am now looking for "three green". I am finding the "three green out of four" kicks a move off many times.  The likelihood of it kicking a move off is even stronger when it occurs at an ES structure level.

volume imbalance footprint

A note about this chart: it was set to the default volume imbalance settings for the coloring which is 140% or the Automatic setting. (see below).

10-28-2013 7-50-59 AM

 

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Volume Imbalance Trade Example