Trading Mastery
A YouTuber discusses two free indicators on TradingView for trading. The indicators are momentum and vbsm, which display momentum and buyer/seller pressure. The strategy is simple: buy when momentum indicator is high and vbsm is green.
the asset. However, if the momentum indicator is making lower lows and the vbsm indicator showing red, then it is time to sell the asset. This strategy is known as the momentum with vbsm strategy, and it can be used for any asset, including stocks, forex, commodities, and cryptocurrencies. In this article, we’ll cover everything you need to know about this strategy and how to use it effectively for your trading.
What is the Momentum with VBSM Strategy?
Momentum with vbsm strategy is a technical analysis strategy that combines two indicators, namely momentum and volume-based moving average. The momentum indicator is used to measure the current momentum in the market, while the vbsm indicator is used to measure the buying and selling pressure of the asset. This strategy is based on the idea that when the momentum and vbsm indicators confirm each other’s signals, it creates a strong buy or sell signal, depending on the direction of the trend.
Momentum Indicator
The momentum indicator is a leading indicator that measures the rate of change of the price of the asset over a defined period. It compares the current price of the asset with its price in the past and shows the strength of the trend. This indicator is displayed as a line chart that fluctuates from zero to a positive or negative value. When the momentum indicator is above the zero line, it indicates a bullish trend, while when it’s below the zero line, it indicates a bearish trend.
Volume-Based Moving Average
The volume-based moving average (vbsm) is a lagging indicator that measures the buying and selling pressure of an asset. It works by calculating the average price of the asset based on its volume traded. This indicator is shown as a line chart that fluctuates between red and green colors. A green color indicates a bullish trend, while a red color indicates a bearish trend.
How to Use the Momentum with VBSM Strategy
To use the momentum with vbsm strategy, follow these simple steps:
Step 1: Set up the Chart
To get started, you need to set up a chart on TradingView that shows the asset you want to trade. Once the chart is set up, go to the indicators tab and add the momentum and vbsm indicators to your chart. You’ll find these indicators in the ‘Popular’ section of the indicators tab.
Step 2: Analyze the Chart
After adding the indicators to your chart, analyze the chart to identify potential buy or sell signals. Look for instances where the momentum indicator is making higher highs and the vbsm indicator is showing a green color. This indicates that the buying pressure is high, and the price is likely to continue to rise. In contrast, if the momentum indicator is making lower lows and the vbsm indicator is showing a red color, it indicates that the selling pressure is high, and the price is likely to continue to fall.
Step 3: Place Your Trade
When you spot a buy or sell signal, it’s time to place your trade. If you see a strong buy signal, open a long position, and place a stop loss below the support level. On the other hand, if you see a strong sell signal, open a short position, and place a stop loss above the resistance level.
Tips for Using the Momentum with VBSM Strategy
Here are some tips to help you use the momentum with vbsm strategy effectively:
1. Use the Strategy on Multiple Timeframes
To increase the accuracy of the strategy, you can use it on multiple timeframes. For example, you can use it on a daily chart to identify the long-term trend and on a 1-hour chart to identify short-term signals.
2. Combine the Strategy with Other Indicators
You can combine the momentum with vbsm strategy with other indicators to confirm the signals. For example, you can use the moving average crossover strategy to confirm the buy or sell signals.
3. Manage Your Risk
As with any trading strategy, it’s essential to manage your risk. Use a stop loss to limit your potential losses and a take profit to take profits at predefined levels.
4. Practice on a Demo Account
Before using the strategy on a live account, it’s essential to practice on a demo account. This will help you to familiarize yourself with the strategy and test its effectiveness.
Conclusion
The momentum with vbsm strategy is a simple yet effective trading strategy that can be used on any asset. By combining the momentum and vbsm indicators, traders can identify potential buy or sell signals and take advantage of them. To use the strategy effectively, it’s important to set up a chart, analyze the chart, and place your trade accordingly. With these simple steps, you can improve your trading performance and generate consistent profits.
