I noticed that many beginner traders completely ignore the importance of the POC in their trading strategy. It's a shame because understanding the point of control can really change your approach to the market.



In fact, the POC is simply the price level where the highest volume was traded over a given period. When you look at a chart with the volume profile enabled, you can clearly see where the real movements are concentrated. That's where buyers and sellers are really fighting.

Why is it useful? Because the POC acts as a strong liquidity zone. It's a natural support or resistance where the market has already shown significant interest. Savvy traders use this to identify potential entry or exit points.

Now, let's talk about how to use POC trading concretely. When I look for a sell entry, I start by finding a POC that aligns with a resistance zone. If the price approaches it, that's potentially a good time to act. But I never do this without confirmation.

Volume confirmation is crucial. I check if the volume increases as the price approaches the POC. A volume spike at this level is a strong signal that the market might reject the price or reverse. It's not a guarantee, but it's encouraging.

Next, I observe the candles. A bearish engulfing candle or a shooting star near the POC gives me more confidence. These patterns combined with volume are serious signals.

But here’s the thing, I never jump in without considering the broader context. What's the overall trend? Is the market sentiment bearish? If yes, it aligns with my sell entry. If not, I pass.

On risk management, it's non-negotiable. I always place my stop-loss above the POC or the resistance zone. That way, if the market surprises me, my losses are limited. It's the foundation of responsible trading.

After opening a position, I stay vigilant. I monitor every move, ready to adjust my stop and take-profit levels based on what the volume shows me. The market changes, and I need to adapt my strategy in real time.

Poc trading isn't just one technique among others. It's a way to read what large amounts of money are actually doing in the market. And when you understand that, you trade with more confidence.
View Original
This page may contain third-party content, which is provided for information purposes only (not representations/warranties) and should not be considered as an endorsement of its views by Gate, nor as financial or professional advice. See Disclaimer for details.
  • Reward
  • Comment
  • Repost
  • Share
Comment
Add a comment
Add a comment
No comments
  • Pin