TradingView is an online trading charting platform that has captivated millions of people and is used on a daily basis at TRADEPRO Academy. The platform is super easy to use and aesthetically pleasing, along with very indicator heavy. The ability to choose any indicator you can think of seems amazing, but can also be overwhelming, so this article is made just for you to weed out the noise from the Top 3 Tradingview Indicators.
TradingView is very unique in that there are indicators integrated in the platform as well as scripts that people can write and also post as indicators in the public indicator area on the website. Meaning you can find theoretically infinite indicators. Usually, the ones that have the most likes are the indicators that you can “trust” in the “Community Scripts” tab.
You can find the indicators at the top of your browser or window under “indicators”.
There are several options that you can see:
#1. Volume Profile Indicator
This first indicator is more of a tool than an actual indicator, or so I would like to think so. It is the volume profile, there are multiple options on TradingView for volume profiles.
They can be found in the “Volume Profile” tab under indicators.
You can see that TRADEPRO Academy has favored the two that are in use.
The volume profile is a tool or indicator that measures volume across price levels. You can read much more on the indicator here & here.
The two most important things that this indicator tells us:
- Where price is expected to gravitate towards
- Where price is expected to reject
The volume profile tells traders where there was a lot of volume traded on a price level, as well as little to no volume.
Price attracts volume, so larger levels of volume become magnets to price. Smaller areas become areas that price can easily pass through.
There are 6 main components of the volume profile:
- POC (point of control)
- HVN (High volume node)
- LVN (Low volume node)
- Value area (70% of the sessions volume)
- VAL (value area low)
- VAL (value area high)
There are two volume profiles that we use on TradingView which are session profiles and the overall profile for the visible price.
Using the SPY example below, on the right we have the visible range volume profile. Where we have the volume profile data based on whatever is on your screen at the time.
The blue volume profiles are the session volume profiles, where we have the volume profile for each individual day.
You can use both together to identify opportunities.
One of the best ways to use the volume profile is to use the “ledges” which are areas where price moves from low volume to high volume that creates a shelf, as a support/resistance level. Can be used on the overall session profile in combination with the visible profile.
Below is an example of SPY.
#2. EMA Clouds
The second indicator that we have on our list are “EMA clouds”. They are exponential moving averages that are combined to form a ribbon-type indicator. The ribbon aspect allows traders to be a little more lenient with their entries/exits. Because we all know that moving averages are never exact.
This is a script by a trader called “Rispter EMA Clouds”.
All of the settings are within the indicator when you open it or “right-click” settings. We use the:
- 5/13 average
- 8/9 average
- 34/50 average
The other averages in the overall indicator can be used or removed. For day trading the three mentioned above are the desired averages. The longer averages that you find in the study can be used for more swing trades.
Below is the SPY along with the EMA clouds added in now, this is a 5-min chart that we use for day trading.
The general rules of thumb for the averages are as follows:
- If we maintain above all averages then the trend is bullish.
- If we maintain below all averages then the trend is bearish.
- The 34/50 average on the 5-min is the last line of defense for the trend. As long as it doesn’t change color then that trend is to be considered intact.
- The 5/13 is used as a trailer for the trend, not sure whether you should stay in the trend or not? As long as you hold and close above/below the 5/13 average you can sustain the position.
- The 8/9 average on the 5-min can be used as a trend pullback area.
- The 34/50 on the 10min dictates the overall trend. Above then look long, below look short.
- On the hourly chart, 34/50 dictates the trend.
#3. Squeeze Momentum Indicator
The final indicator in our arsenal, of our Top 3 indicators on TradingView is called the “Squeeze Momentum indicator” by LazyBear.
This is another scripted indicator that allows us to find trends that are most likely to continue and aggressively at that.
If you search for the indicator this is what it should look like:
The indicator looks like an oscillator. Meaning that it has shaded areas of red/green. The more important part of the indicator is when the “Squeeze” happens. Which is denoted by the white “pluses” in the indicator. The trend is most likely going to continue and run based on the appearance of the squeezes.
Take the following image as an example. In a downtrend (yellow box) we have a heavy red oscillator. Which has a strong squeeze, this is not enough to say “alright time to get short and hold forever”. In this case consider the structure, the EMA clouds, and the levels you have. The short opens up at the start of the yellow box. Then can hold out until the squeeze line ends.
It’s the same with the upside, yes there is green on the indicator, that doesn’t mean that you get long blindly, follow your trend and the overall market movement, meaning we would probably look to get long on the retrace of 422 of the start of the blue box. Hold as long as the squeeze line is intact. The squeeze line ends before the green oscillator ends.
There is a lot to consider when looking at indicators, can you solely rely on them? No. Can you layer them only on the basics of the market, volume and structure? Yes.
Always consider backtesting indicators and understanding how they really work before use.
Happy trading and enjoy!
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The information contained in this post is solely for educational purposes and does not constitute investment advice. The risk of trading in securities markets can be substantial. You should carefully consider if engaging in such activity is suitable for your own financial situation. TRADEPRO AcademyTM is not responsible for any liabilities arising as a result of your market involvement or individual trade activities.