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hey everybody it's Mike from amorphos here and welcome back to my channel I'm glad you can join me for today's video where I'll be talking about uh value areas you know sort of trading around value areas and their importance in the order flow so um before I jump in if you enjoy my videos you know I'm trying to get one up every single day at least one um don't forget to subscribe and click the notification Bell so you don't miss any new upload that I do and if you find today's video helpful be sure to hit the like button for me and leave a comment sharing your biggest takeaway and also you know if you got any suggestions for videos you'd like to see let me know you know I love hearing your feedback you know today's video um on trading around value areas actually came from one of my uh private training sessions uh yesterday Wednesday um I just didn't have time to cover it there but you know it was a very valid uh topic that you know I think a lot of Traders would be interested in knowing more about so that's why I'm making this video for you guys today so when you're looking at Value okay and in the order flow when I talk about value areas I'm talking about um you know sort of in the profile sense you know the market profile volume profile um you know determining the value area as seventy percent of where the volume trades over a certain period of time what I do is I break it down but onto a bar basis I mean honestly you know people they come into the markets and they don't realize right they they read a book or something or watch a video and think that's the way you have to trade right value is something that that is developed over time and it's up to you to determine your time I just so happen to use it on a bar by bar basis I could use uh you know a shorter time I could use a longer time it really comes down to you I know some guys that will look at a profile for the entire week and see the value for that week I mean they're a different type of Trader than I am I am a short-term Trader a day trader I'm in and out uh during the day many times if and I'm not looking to hold a position for a long period of time I'm just looking to um you know I'm like a little bird right flying around you know picking up the you know I'm not trying to pick up the whole piece of bread all at once I'm just trying to pick up you know just enough to uh take back to the nest come back get some more go back get some more Etc so you know the same concept would apply I'm going to talk about you know a minute based chart a range base chart and but it doesn't matter if you're you know using a one minute chart um or 30 second chart or a 15 minute chart or a 30 minute chart or a four hour chart a daily chart a weekly chart value is is value in the sense of where majority of the volume is trading okay so we'll start here this is a uh an eight range chart you know a lot of times I do videos I I show it on a you know on a minute based chart people say hey can you show me on a range base chart okay so I'm going to show you both um because you know we all trade different chart types and the same Concepts apply whether you're looking at an eight range chart uh a 1987 tick chart or you know whatever okay value is where 70 of the volume occurs now again you can break it down to what you determine right if you want to look at you know we're 70 of the volume appears in a five minute period you can if you want to look at you know where the value areas over an eight minute period you can there's nobody says that no you can't do it that way okay I know some people out there you know they make this is how you have to trade and if you don't trade this you know you're doing it wrong remember right that's what makes the market everyone has a difference of opinion everyone has a different way of approaching the market so this is a eight range e-mini chart and it's just a simple footprint chart right no you know you just got your uh point of control you got your imbalances and you see the volume on the bid the volume on the offer so if you're using the order flows Trader software we make it very easy for you okay so you can see up here in this indicator settings right value area percent it default is set to 70. and then you're going to scroll down into the settings in here and you're going to find the value area okay you're just going to enable it now you can have it fixed like this or until tested now we have two types so we have value area we have engulfing value area um I'll get into the engulfing value area a little bit later but first we'll start with just sort of your fixed value areas okay then click apply click OK and give it a second for the chart to come up here all right so now all right I see in addition to the point of control in the bars I see another box inside of the bar in a sense that is the value area that's where 70 of the value occurs now the order flow is Trader software if it's a green up candle it's going to color the value area green if it is a red down candle it will color the value area red you can actually adjust that and if it's uh just so happens to be a doji bar that opens and closes at the same price level it will color the value area gray now if you wanted to adjust these colors you could simply just go into the settings go in here right and you can change value areas right you can see black for doji's green for bullish and red for bearish okay and it's black you know the color of the candle on the outside of the box I'm fine with it black and so there you go there you have your value Aries now it's from these value areas that you can start to get assessed now remember these are this is an eight range bar chart so each bar is going to have a value area just says each bar would have a point of control and you know how do you want to use it well okay ideally you know you're looking for these areas right usually value is going to overlap in a way okay and you know you can see these areas where These Bars were like in here right value is mostly overlapping where it gets gets interesting right if you're looking at a bar by bar basis is you're looking at these gaps between the value area low and the value area high in red candles or in green candles from the value area high to the value area low of the next candle okay and you know I like to see these areas I call these abandoned value areas and again you have a choice of how you want to color if you just want to see the value areas like this okay that's one way I like to draw it out what we call until tested okay so I'm going to go back into the settings and I'll make that quick change there so you can see the value areas just in each bar what I'm going to do is I'm going to draw it out until tested okay and what you're going to see now is when a market is moving away from value immediately right immediately meaning the next bar so for example here right I've got this swing low got this valuator down here towards the bottom of the bar then the next bar it gaps up in this value right it doesn't even test it gets within you know a tick two ticks of that value area here it hasn't tested it really it just came down got within two ticks then rallied up same thing in the next bar you have this value area that's hasn't been tested you got one two three four five and then the opposite starts happening as you start coming down now how I look at these is I pay special attention to these if we're at a swing high or a swing low because really what I'm trying to focus on is where is this shift in value okay if I'm at a swing low and I have a value area that's not tested in the next bar right like here right we're coming down we're sort of testing each value area as we're going down in the next bar okay now there's a bearish one obviously but we're on a downtrend really what I'm looking for is an area where the market can potentially change and start to rally and it comes right here after this bar closes now you don't know until this bar here at 8 57 and 39 seconds closes that it's not going to trade in there because you know if the bar is still trading it could very well trade back in there but I know that once this bar closes that's my signal they'll look to take the trade you know from 35 and a half and it trades all the way up into the 40s and then I get up here to a swing High and it starts to reverse right it's not trading back into the next Mars value to me that is a sign of a market that has some momentum that is moving now this is a eight range chart if I was looking at you know a called a you know a one minute chart I'll just make that change really quick here and then take a look right same thing I'll just sort of go back here in time you know to wherever uh you know where's Cash open Cash open right here okay you know wait for some sort of sign I hear it looked like okay we came down here a little swing low maybe it can start to Rally then it came back in and tested once it starts testing okay then I know that okay we're not running yet let me just make this change here this is ninja Traders frustrating sometimes it sometimes it just goes in automatically resets this bar with the 100 which is like the max and I can't expand it then here we go right we come into a swing low I've got a value area next bar it's abandoned all right it doesn't test it and you get a nice move from you know the 38 all the way up into the 42s this one again you know if I was looking to get long I would have been stopped out here okay fine I'm gonna look for the next one because I'm looking for this move to start Market start moving okay it started moving here but then it comes back in with a bearish value area at a swing high it's abandoned it's my sign to get short okay and you can see how often times these value areas act as support or resistance right like right here it comes right back to that area right here's the value area from before it came comes right back trades a lot of volume in here fourteen hundred a thousand okay here right it's a nice swing low doesn't trade back in starts going up you should be getting long in this bar then you get another signal you know another one here coming in where's my target it's this value area from earlier up here around the 40 area so if I'm long you know from 33 I know that you know you get up to 40 that's my potential Target if we get up to 40 you know we might stall out a bit and that what do we do that's what we do we get up to 40 and we sort of stall there right then we start picking up some more steam in here we got another value area that's untested here um you know let me just start making these smaller new highs so again it doesn't matter what Market you're looking at what chart type this is a one minute chart if you know I don't you know I don't necessarily look at five minute charts but I'd be looking for the same thing if I was going on a five minute chart right right here right swing low value area Market rallies up on the way down after you hit that high value area that's untested here you get short where does it stop it stops right down here where you have your value area from earlier that's what I'm talking about when I say these value areas act as support for resistance right resistance it trades right up in two ticks into this value area and comes off again right here it came three ticks into this value area you know cash what was this cash this is the bar the cash close we can see you know anytime you have these value areas that don't get tested at least in the next bar it could be a sign of a move that's about to happen um this is you know e-minis I don't know let's take a look at bonds on a five minute chart okay now again on bonds I like four range but again I'm also curious to see how it looks on you know different chart types okay obviously you know we had some numbers today but we get up you know this one and people say well yeah it went up then it came right back down okay well this is in the middle of an area right I I was explaining before I'd like to see them on swing highs or swing lows or ideally swing highs or swing lows or after a swing High you know on the next bar it came in here for a nice you know short and you can see it's acting as resistance right I don't think we even got anywhere near there the rest of the day um you know I like actually I like range based charts on on bonds you can see here right swing high right here value area not tested game what came within a tick of it and then we had this nice sell-off right where's my targets I got a Target here I've got a Target here okay now I've got a bullish one coming in right here okay where does it stop it stops here where the value area is coming in right and it starts working its way back down gets through these okay then it starts reversing at your low of the day you got a bar with the value area where it's not tested in the next bar then the second bar test it gets inside but then it rallies up okay here you got a doji one that's why it's gray color um no I mean it all markets I don't know take a look at gold like Golds Goldfinger um what is this the range based charts you know I mean probably using if I'm looking at Gold you know I think eight range is fine or even a a one minute chart is fine you can see on a market that's running value area that's not tested in the next BAR value where you're not tested an X BAR value where you're not tested value area not tested value area not tested value area that's how you know the Market's got a head of steam right when you start seeing one two three four five and go I mean you don't need to wait to the oh I got ten no you want to get in as soon as possible once I start seeing them sort of Bunch up like this one two you know even three to me that that's a sign of a strong move just like here you got one okay anything a little sideways and another one coming in okay there's one here's another one right you get a nice move up here you got one two trades back out up in there and you know I there are some Traders out there that you know once I introduced this they loved it immediately they they told me this Jesus I wish I had this long ago because what they do is they just wait for the pullback in there and then the rejection right like this right it's coming off pulls back in then starts coming out especially if it leaves a value area like this that's not tested they just Pile in on that move right um you know here got one comes in okay it starts moving up pulls back again to that level you know this area here pulls back in here pulls back again into this one as well as this one so there's many different ways you can trade it all right I mean you could trade it on a pullback you could trade it as a you know go with that trade immediately um you could use it you could use these as targets right if you're long you know and you're starting running into a bunch of overhead you know value areas from earlier the market might start to stumble at some of these areas just as it did here right with this one I mean it got through these two little ones that is stumbled up again here all right you got some overhead one got through this little one here then it starts stumbling around this area where you have these value areas from earlier okay so you know that that's my little video on trading the order flow value areas on a bar by bar basis and again it doesn't matter whether you're using a one minute chart whether you're using a range based chart if you're using a tick bass chart or a volume based chart you trade it the same right this is uh what do I what I pull up here 200 tick chart okay same things all right value area it's not tested valuatory that's not tested value area that's not tested I mean this one in my opinion is the Spy the strongest one because it's coming in at the swing low you know come up here make a swing High pull off make another run back up towards That Swing High evaluate that's not tested but there's a lot of different ways to trade them right you gotta start thinking how you can adapt this tool of order flow into your own Trading so I'll end this video on value areas I hope you found it useful and again you know if you find these videos useful and helpful for your understanding of order flow let me know by leaving a nice comment below and you know be sure to put something in in the comments section you know to what you'd like me to discuss next by um you know but just simply leaving a simple comment below so if you enjoying this video be sure to hit the like button and subscribe to the channel so you don't miss any more videos thanks everyone bye-bye