Volume--- how to use it and WHY

If you know how the bars are constructed, let's say 1K shares/bar, and you know the SMA is an N period mean of the close of each bar I could give two datasets, one containing a range of SMA values and the other containing ticks with the datestamp replaced with an ordinal numeric index for each tick.

With just that information you would be able to reconstitute the bars, compute the SMA and locate where the first dataset exists within it.

Time is nothing more than a label unless it's an integral part of the method's construction.

 

yes, you can interpret/present the data as you wish.

however, you can't avoid the inherent time quality regardless of rhetoric to to contrary.

for example--- say it takes an entire session to create one 1000 share bar--- that bar, by default, represents the session--- the session is determined by time therefore the bar has an inherent time quality. this example can be applied to any smaller or larger time factor. the nature of the world makes it unavoidable.

surf

surf

 

Show me your chart that does not require time to form ... please.

 

A tick chart or volume based chart.

 

This has been asked and answered with surf's post.

You also missed my detailed explanation on the different charts and how they work, mike007, and you didn't post a chart.

This is getting a little redundant ...

 

I told you.

 

Just a little.

It's quite simple. Tick, Range, Volume, Time bar charts all show how price changes over time. The only difference is the determination of the time interval for each bar. They each show the highs and lows at the same price and in the same order. There is not much to choose between them.

However, if you are interested in looking at how volume changes over price and time, then one of those chart types is much less useful. In fact the only reason I can think of for promoting constant volume charting is as a marketing gimmick.

 

well stated.

surf

 

Total garbage. You and I exchange $1 every minute for an hour. The volume is $60. Nothing was bought or sold. No value was added. It is equivalent to exchanging nothing, or 0 volume.

Except if were are asked to pay tax on it. This is why a tax on transactions will actually make things more transparent in the markets. It will make it costly for manipulators to fake volume.

I seems like some people at tradingmarkets.com are living 20 years ago. This is what happens when failed traders 20 years ago turn to celebrated authors.

Plonk

 

Surf, using time as a reference point to synchronize the dataset is entirely different then being an integral part for computation of the method.

Let's say there's a horse race you want to watch live and you know that it's going to start at 6pm EDT on some Saturday in May.

While you certainly need to know that information, as well as the channel it's going to be televised on in order to watch the race, time itself is irrelevant to the outcome. All that matters is which horse's nose crosses the finish line first.

However, if you want to know the duration of the race or the average speed that the race was won then you certainly need to know the elapsed time.