Emini S&P 500, Russell 2000, DOW and Nasdaq 100 Futures Charts.

In the example below, you can see how this trading system is used to go long the NASDAQ 100 E-mini. In this particular instance, a 5-point gain was pre-determined as a satisfactory profit target; a decline of 5 points was set as the stop-loss level.

Chart 1:   Establishing a long position based on the SBV indicator. NASDAQ 100 E-mini.

Important: The 66% level for the SBV indicator was determined in relation to the prevailing market conditions at the time the examples above were selected. In order to establish the optimal critical levels for the SBV indicator, a trader should consider the current market situation and review a chart history of prior volume surges including their magnitude (i.e., the level the SBV indicator reached). Furthermore, it is important to look at more than one chart and to use multiple timeframes. For instance, while a volume surge may look imposing and appear to be critical on a 2-hour or a 1-day chart, the very same surge may not look nearly as significant on a 5-day chart. A prominent surge appearing on a 1-day chart could well affect index levels and bring about a one to five point reversal. In contrast, a prominent volume surge on a 5-day chart may prompt a reversal of 5 to 10 points.