SMART Volume Spread Analysis Software (Strength or Weakness Module)

A lot of the newer SMART Volume Spread Analysis Software users get into the habit of trying to trade every signal as if each is a tradeable event.  A number of the signals (detailed extensively in the live chat and here) are most definitely tradeable, and it’s not to say that the other patterns/signals aren’t important but that they should be treated as indications of strength and weakness and what is likely to happen rather than what will happen.

The SMART Strength or Weakness Module however has the distinction of being both an indication of strength or weakness and a tradeable signal.  Please read on.

We are only going to focus on the Strength and Demand indications within the SMART SOW module (Noted by blue and green square icons on the chart) as the reverse signals (Pink and red) do not react in the same manner. (Not enough to warrant discussion here anyway)

The signals within the SOW module come from proprietary code within our background scanners as well as supply and demand scanners within the module itself.  Normally on a single blue square (strength) I would say it’s just an indication and should not be traded solely because it has appeared.  The same goes for the green square (Demand) but when strength and demand indications occur on the same candle/bar it is quite different as the following examples will demonstrate.

I often say how easy SMART makes it to see/read what is really happening on the charts in real time and here is a perfect example. Take a look at the following charts and you should immediately be able to see the pattern we are discussing (Be aware of volume as well as these all occur within non dead zones (except one) You can see very easily how single blue squares react but more importantly how the price reacts when both supply and demand indications appear on the same candle/bar