Using the "Money Zone" to help predict your trades.

[Honeyman 3]

The Money Zone is where 70% of the volume was traded on a given day. It can use it with das trader. Its in the study config/volume by price/config button and check the  show volume area box.

to use it  go to the previous day and mark the value area high, value area low.

you can then use the marked area to judge the type trading day for the upcoming session. in this example NIO is opening above vale and above yesterdays range. this signals bullish strength and should have you looking to take a long position if your bias is confirmed.

This can also use this with a longer time frame. when we go back 5 days and see NIO has been consolidating.  Mark the Money Zone area for this expanded timeframe and you can see after 3 days NIO dropped below the lower value area and quickly bought back up to the top of the value area. the next day NIO sold off in the morning and was quickly bought back up to close above value . This is signaling a possible rejection of value and a possible move to new value ahead.

another confirmation of strength in this move is the pivot point relationship. it is an inside value relationship with a narrow pivot range further confirming the possibility of searching for new value. as we can see it didn't even stop to test the value area high before looking for higher value area.

Edited July 21, 2021 by a1sauce

[Robert M NYC 3]

Hi Honeyman. Thanks for sharing this.

My only concern is that the "money zone" is actually calculated by using the market profile. You are using the Volume by price indicator here, which will have a different "zone" and levels as a result.

The market profile does not account for volume and is simply showing at what price the stock was traded at any given time.

I guess you know this and use this method for the purpose described above, it will still work and will give you a bias for the next days session.

I would love to hear more how you use it and how helpful these levels are.