Footprint Chart Example for May 15

Knowing when to step in and buy a falling market is easier said than done. One of the key benefits a Footprint chart offers a trader is the ability to see inside the bar for early clues. Another useful metric that is generated by the Footprint chart data is the aggressive buying and selling volume. Applying the volume study set to Delta to any chart type in MarketDelta provides a way to aggregate the aggressive buying and selling on a bar by bar basis.

In the crude oil volume imbalance footprint chart below, look at the bottom of the chart. As the market traded lower the volume breakdown indicator showed continued weakness and was "red" as the aggressive sellers overwhelmed buyers. FINALLY, the market reached a point where aggressive buyers stepped in and "caught" the market and formed a bottom.

Using these tools can greatly improve a trader's ability to understand market reversals AND also to enforce patience during strong trends. After all, it is not fun (or profitable) to buy into a falling market too early.

 

Footprint Chart Example for May 29

Footprint Chart Examples for May 11