Our first swing trade of July was Nvidia, and we cleaned up shop.
We got in, held the 40 period, and those calls ran over 100%. Fantastic. But the trade isn't the lesson. How I read the chart is the lesson, and volume profile is the only tool I used to get there.
So let me actually teach it to you, because most people, including the gurus, are reading it wrong.
By the end of this you'll read a volume profile chart better than every furu on the internet.
Start with what nobody explains correctly.
Everyone thinks the bars on a volume profile show what day had the most volume. Wrong. They show what price had the most volume. That is the entire point, and it is why the tool is so powerful. I don't care that Monday was a busy day.
Who cares about that. I want to know what price gets everyone's interest. The volume profile tells me that, and nothing else does it as cleanly.
The fat bars are called nodes. A node is a price where a ton of trading happened, so it acts as support and resistance. They call the biggest one the point of control. I don't even know why they call it that. It's really just the point of interest. That's all a node is. A price a lot of people care about.
So here's Nvidia. It was trying to break out of a pennant and just needed a catalyst, so I went hunting for a name that sold off recently with a clean setup. I run my profile low to high. That's my sample.
Now everyone gets fixated on the wrong thing. It broke the 200 day, it broke the point of control, path of least resistance is up, blah blah. I don't care about the break. I care about the retest.
Price broke that node, came back down to retest it, and got bought right back up. That is the tell. Buyers were sitting there. They don't want it to fall, so they keep buying, and if there's that much interest at a price, it can't just sit there. It has to go up. That retest is what made me want the trade, not the break.
Above the node sat a thin zone. A thin zone is almost like air. No node, no support, no resistance, nothing to fight through. So price had clean room to run until it hit the next concrete wall, which was the node above and the 40 period. Nvidia rolled straight through the air and stopped right where it should. Textbook.
Here's where I make you smarter than the gurus.
Half the volume profile furus on Twitter will point at a chart and go "look at this beautiful thin zone." Go back to Harvard Trading School, Chad. Because most of the time it isn't a thin zone at all. It's a gap.
There's no volume in a gap. No participation. And a gap will fake thinness that was never really there, a GMO thin zone, artificially created, and the furus don't even see it. They just see the pretty picture.
So don't get fooled. Look to the left of your profile and check that the candles fill every patch of those nodes.
See a gap? Cut it out, slide your sample over that same area, and measure it again. If the thinness holds up without the gap, it's real.
Price honestly doesn't like that area, which is usually why it gapped through it in the first place. If the thinness disappears the second you remove the gap, it was never there, and you were about to trade off a mirage.
That test is what made Nvidia fair game. The thinness was real, so I trusted the run.
Volume profile is the wand. You're the magician. It's the paintbrush and you're the artist. I do me, and this is how I do it. It isn't copyrighted, so if you like the way I paint, steal it.
This is exactly what I trade in front of you every single day in The Close.
Swing trades, bombshells, fuses, called live as I see them. We're not some Mickey Mouse house over here.
It's a think tank, and the door's open.
Rock On,
Voz