In this newsletter, you’ll see that I use 3 chart indicators to inform my opinion on a possible trade opportunity. These 3 tools are part of the TAS Market Profile suite of indicators.
- TAS Navigator: “Check the trend”
- TAS Boxes: “Look for the breakout”
- TAS Market Map: “Take the highway, skip the traffic”
TAS Navigator: “Check the Trend”
Official Definition (from TAS): The TAS Navigator is a versatile indicator that combines several signals to help you manage your trades and avoid unfavorable situations. TAS Navigator appears below the chart itself.
- Bright green/red indicates the directional move of the market continues to gain momentum.
- A darker colored green/red tells us that the buying or selling momentum is falling off.
- The bright pink bar tells us when the directional move has reached “peaking” conditions.
My take: This vital indicator tells us which direction we should expect to be heading. If the tips of the bars are green, we have no reason to be looking at anything other than bullish trade opportunities. Likewise, if the tips of the bars are red we should be looking nowhere but down.
Dosdall Daily Edge will always present a trade idea going in the direction of the Navigator.
TAS Boxes: “Look for the Breakout”
Official Definition (from TAS): The TAS Boxes offer a dynamic representation of developing commercial balance areas.
- The “red line” represents the upper resistance boundary of the plotted area
- The “blue line” represents the lower support boundary
- The “grey line ” represents the Point of Control (POC) or balancing point.
My take: The TAS Boxes go hand in hand with the TAS Navigator because they can potentially help us to time a trade entry as it is breaking out of a defined range and either making new highs or lows.
Dosdall Daily Edge aims to identify markets that are presenting potential breakouts of support or resistance. In order to be valid, the breakout must also be in the same trend direction as TAS Navigator.
TAS Market Map : “Take the Highway, Skip the Traffic”
Official Definition (from TAS): The TAS Market Map uses a sideways histogram, overlaid onto price data, to graphically represent volume accumulating at price.
My take: In other words, it helps us to identify areas of: “City Traffic” where markets tend to trade sideways “in congestion” (red horizontal lines), and “Open Highway” where markets tend to accelerate in a directional move (blue horizontal lines).
Dosdall Daily Edge seeks to identify trade opportunities that are approaching “open highway”. We seek to avoid congested areas of “city traffic” where the markets tend to be choppy.
Putting it All Together: The “3 Star Setup”
The image above is typical of what you can expect to receive with your subscription to Dosdall Daily Edge. We will look for markets that are either meeting or close to meeting all three of our outlined criteria.
- Where are we heading? TAS Navigator gives us initial direction. We always want to be on the right side of the trend.
- Where is the “on ramp”? TAS Boxes let us know where potential breakouts are occurring. We want to look for breaks above or below the red or blue lines.
- Where is the open highway? TAS Market Map lets us know when we are approaching areas of low trade volume. We look for smooth moves with distance as opposed to choppy city traffic.
THE RISK OF LOSS IN TRADING COMMODITY FUTURES AND OPTIONS CONTRACTS CAN BE SUBSTANTIAL. THERE IS A HIGH DEGREE OF LEVERAGE IN FUTURES TRADING BECAUSE OF SMALL MARGIN REQUIREMENTS. THIS LEVERAGE CAN WORK AGAINST YOU AS WELL AS FOR YOU AND CAN LEAD TO LARGE LOSSES AS WELL AS LARGE GAINS.