Topic 11: Footprint Chart Elements (The Footprint)

Three Pattern Categories

1. Multibar patterns — patterns consisting of multiple bars
2. Intrabar patterns — patterns formed inside a bar in real time
3. Patterns with volume nodes at bar end — assessed during or after bar close

Intrabar Patterns — The Colors

Color Intensity = Imbalance Strength

• Darker box = greater imbalance in order flow
• Lighter colors = more balance in order flow
• Same colors box after box = more targeted/directional trading
• Strong color changes = balance and indecisiveness

Bid vs Ask Balance

• Bid and Ask volumes practically the same = balanced trading
• Uneven values = targeted/directional trade
• When uneven values reach highest value = supply/demand has reached the top (exhaustion)

Critical Questions to Ask

1. When did you notice the extreme imbalance? (After a big price movement?)
2. Where is the price now? (At an important zone? Already in a zone?)
3. Everything depends on WHERE the price is relative to key levels

How to Use Footprint

• Use ONLY as extra tool alongside normal analysis
• Use to determine the RIGHT TIME to open or close a trade
• Purpose: identify where trading activity is weakening or strengthening at key levels

Numerical Values

• Values show how a specific value correlates with itself during bar formation
• Also correlate with neighboring cells and bars
• Help assess volatility
• Each market has its own specific values (gold different from forex different from indices)
• Values depend on timeframe
• Important: account for time of day and special days (holidays, news events)

Images

Homework

Submit 2 examples of extreme imbalance.

Key Takeaway for Bot

• Color intensity maps to imbalance strength — bot should weight by magnitude not just presence
• Context matters: same imbalance at a key level vs middle of range = completely different signal
• Each market (gold, oil, forex) has different "normal" values — thresholds must be calibrated per instrument
• Time of day affects values — London/NY sessions have higher baseline than Asian session