Minvervini VCP + Stage 2
The Minervini VCP + Stage 2 is a powerful trading indicator designed to help traders identify profitable trading opportunities. This indicator is based on the principles of Market Wizards author Mark Minervini's Volatility Contraction Pattern (VCP) strategy. It combines the VCP pattern with a Stage 2 trend analysis to provide traders with a comprehensive view of the market. With the Minervini VCP + Stage 2, traders can identify potential breakouts and trend reversals, allowing them to make informed trading decisions. This indicator is suitable for both novice and experienced traders and can be used on a variety of trading platforms.
📜 ––––HISTORY & CREDITS––––
This indicator is a culmination of two pivotal concepts from legendary traders. Firstly, the Stage Analysis, inspired by Stan Weinstein, which helps traders identify the key phases of a market cycle. Secondly, the Volatility Contraction Pattern (VCP), an ingenious concept by Mark Minervini. Notably, Stage 2 of Weinstein's method aligns with Minervini's non-negotiable criteria, emphasizing its significance in profitable trading.
The Stage 2, 4, and VCP indicator offers a unique blend of the Stage Analysis and VCP principles. It not only identifies the market stages but also the subtleties within these stages, ensuring traders are always one step ahead. By integrating the preparatory warnings for both Stage 2 and Stage 4, traders get the anticipatory edge they need. The three states of VCP further add depth, allowing for pinpoint entry and exit decisions.
🛠️––––WHAT IT DOES––––
👉The top part of this indicator deciphers the market's stage. With four distinctive colors, traders can easily recognize:
Stage 2 (bullish phase) - unless the indicator is Cyan color, Minervini would not enter into a trade
🟦 Prepare for Stage 2 - if the market is running well and you have good traction, could consider entering stocks on the warning, preparatory Stage 2
🟧 Stage 4 (bearish phase) - this is reverse to Stage 2 and could be used to utilize for short
🟨 Prepare for Stage 4 - this is also reverse to Prepare for Stage 2
👉The bottom section delves into the VCP, categorizing it into three states:
Early VCP, indicative of initial contraction,
Normal VCP which is the standard contraction pattern,
Tight VCP, representing intense contraction and imminent breakout potential.
💡 ––––HOW TO USE IT––––
1. **Stage Analysis**: Look for the cyan color which indicates Stage 2, a prime buying opportunity. The blue color serves as a precursor, warning traders to get ready. Conversely, orange signals Stage 4, indicating selling or shorting opportunities, with dark orange as the preparatory warning.
2. **VCP Analysis**: Monitor the VCP states. An early VCP in light pink shows the market's first signs of volatility contraction. The standard VCP in pink is ideal for trade setups, while the dark pink (Tight VCP) showcases severe contraction, hinting at explosive breakouts. Incorporate this with Stage 2 to optimize trade entries.
Use predominantly on the Daily Timeframe and use in combination of other Minervini Indicators
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ThinkorSwim (available, but separate):
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If you are looking for Promo videos, where you can compare the original indicators to what we have creted there are plenty of public information in Youtube. If you have trouble finding them shoot us a message.