I recently got the following question and the answer may be of intrest to some of you trading forex.
I recently bought your book “CAPTURING PROFIT WITH TECHNICAL ANALYSIS” , I found very interesting and now I already incorporate some techniques into my trading strategies.
My inquiry is in reference of the SVAPO indicator. I’m using it very well for intraday 10 minutes charts for stocks and options (Volume version). However when I tried to use for FOREX 10 minutes chart price, the indicator shows the information very different against other assets and time frames. In fact I’m using the NO VOLUME SVAPO indicator for FOREX. I use normally HISTOGRAM format presentation, I can see some bars only when there is a very big peaks and trough. When the behavior of the pair is flat, no major oscillation or narrow pricing changes (very common in forex pairs) the indicator just presents a straight line without any bar oscillation into the histogram for a large number of bars. Only works in daily chart price for FOREX pairs. This situation I realized just for FOREX pairs. I think you were thinking about the forex trading tools where you created it. I really want to use this indicator for FOREX, I run FOREX a lot. There are parameters for the indicator, I need to change some?, or change some specific feature that I don’t know? What do you think we can do about it?
This was my answer: I have not really tested it on forex. But it should look OK. Looking at real time charts and small percentage changes, you will need to adapt the “minimum %o price change” to a much lower value than the default 1. On 10 minutes forex you should use a value lower than 0.05 and a SVAPO value of 8 or 5.
And the reaction: First at all thanks for your fast reply. Yes, it is OK, the parameter customization works very well. The price change of 0.05 shows the relevant information I need. For scalping mode a SVAPO of 3 and minimum price change works even better.