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Volume Leads Price - VSA and Wyckoff

  • #41
  • May 13, 2019 4:54pm May 13, 2019 4:54pm
The imbalances are created by big orders of MM and these orders need to be filled at their prefixed price range (at wholesale price).
All these orders can't be filled in one go hence the retest to the zone to sell or buy again at wholesale.
Usually I enter only on first retest to boost my odds.
  • #42
  • May 13, 2019 5:08pm May 13, 2019 5:08pm
Quoting naviafra
{quote} Your questions basically covers everything. I cannot answer it all right away because it will influence the learning curve. I will answer all in time and step by step making sure everything is understood correctly
one per day is enough.
need time to understand my questions as well.
  • #43
  • May 13, 2019 5:23pm May 13, 2019 5:23pm
I will do my best to answer all unanswered questions Tommorow as I have to sleep now. Big day Tommorow =)
There is no edge in trading. Your edge is understanding risk
  • #44
  • May 13, 2019 5:26pm May 13, 2019 5:26pm
Quoting Merka
The imbalances are created by big orders of MM and these orders need to be filled at their prefixed price range (at wholesale price). All these orders can't be filled in one go hence the retest to the zone to sell or buy again at wholesale. Usually I enter only on first retest to boost my odds.
What is/are the sign that tells you the orders are too big/many and will not filled in one go and need retest of a level or a zone?
I dont have access in order book.
Only info i have is from mt4 .
I know sell HIGH and buy LOW.
So if price is going fast north , means buyers think is LOW and sellers waiting few pips northern to sell HIGH and give a fight each other.
After the fight we will see on screen if price continue north or take a south path until next fight .
So for you after the first fight(imbalance) , you wait for retest to enter a trade ?
rgrds
  • #45
  • May 13, 2019 5:37pm May 13, 2019 5:37pm
Quoting zarkon
{quote} What is/are the sign that tells you the orders are too big/many and will not filled in one go and need retest of a level or a zone? I dont have access in order book. Only info i have is from mt4 . I know sell HIGH and buy LOW. So if price is going fast north , means buyers think is LOW and sellers waiting few pips northern to sell HIGH and give a fight each other. After the fight we will see on screen if price continue north or take a south path until next fight . So for you after the first fight(imbalance) , you wait for retest to enter...
These big boys move huge huge money and they choose in advance at which price range they will place their orders.
When you see big price movements for sure are not retail trades.
You need to train your eyes to see on chart the sign left behind by MM.

I'm sure thread started will show us his knowledge on how to follow MM.
Let's see and wait
  • #46
  • May 13, 2019 6:17pm May 13, 2019 6:17pm
Naviafra

I was looking at the chart on post 30 and noticed that the supply area you designated is actually part of a bigger supply zone from May 1. This helps explain why the price went above the supply zone on your chart on May 13. See the chart below.
Attached Image (click to enlarge)
Click to Enlarge Name: EURUSD 2019-05-13.png Size: 78 KB
  • #47
  • Edited 11:05pm May 13, 2019 9:29pm | Edited 11:05pm
Quoting naviafra
Supply and Demand The markets are driven by the imbalance of supply & demand as I previously stated. Prices will move down when supply overcomes demand, and prices will move up when demand overcomes supply. Easy as that. But is it really that easy? How can one identify when supply has dried out? We only have a chart at our disposal, we cannot do market research, advertising campaigns and we cannot see order books, so are we wasting our time? Well, not exactly. There are some ways of getting this information from the charts, not all the info but...
This is from the book, A Complete Guide to Volume Price Analysis by Anna Coulling, is it not?
  • #48
  • May 14, 2019 12:08am May 14, 2019 12:08am
here is the book link.

https://www.tradeguider.com/mtm_251058.pdf
  • #49
  • May 14, 2019 12:25am May 14, 2019 12:25am
Quoting Macdon
{quote}This is from the book, A Complete Guide to Volume Price Analysis by Anna Coulling, is it not?
Honestly, this is the first time im hearing about that book.
Wyckoff books and Tom Williams are what I have read before
There is no edge in trading. Your edge is understanding risk
  • #50
  • May 14, 2019 1:05am May 14, 2019 1:05am
Price goes to volume so trade can be facilitated, a movement in price is just an imbalance. *bows head*
grist for the mill
  • #51
  • May 14, 2019 1:43am May 14, 2019 1:43am
Quoting naviafra
{quote} Honestly, this is the first time im hearing about that book. Wyckoff books and Tom Williams are what I have read before
It must be a generic example to describe the process of volume analysis. I agree with what you say though and I'm curious as to what other books I can read about volume.
  • #52
  • May 14, 2019 2:11am May 14, 2019 2:11am
Quoting WSoar
There is no real volume in foreign exchange market. VSA and Wyckoff are not better than fancy indicators and share the same problem- they doesn't work when you start trading using them forward(Backtesting paradox). You are right about supply and demand(not those stupid rectangles people are drawing having no idea what they are doing) but you are wrong about commodities. What is Forex? It is what it's called - Foreign EXCHANGE Market ....EXCHANGE... get it? Big boys doesn't care about those stupid charts if they need to exchange money they just do...
Big institutions can not just enter a sell trade and instantly find a buyer.
This simple fact alone means that volume may have it uses as it can be used to determine where individuals ( retailers ) orders are being absorbed.
  • #53
  • May 14, 2019 2:44am May 14, 2019 2:44am
Quoting AmmaBoss
{quote} Big institutions can not just enter a sell trade and instantly find a buyer. This simple fact alone means that volume may have it uses as it can be used to determine where individuals ( retailers ) orders are being absorbed.
Exactly, that is why they sell the large orders when "we" are buying. So that is why true weakness appears in upmoves. But let's not get ahead of ourself. Lets talk some more about imbalance of supply and demand
There is no edge in trading. Your edge is understanding risk
  • #54
  • May 14, 2019 2:47am May 14, 2019 2:47am
So the imbalance of supply and demand.

The heavier the imbalance is, the stronger and quicker the move. Look at a chart (diregard volume for now) and look at areas where price bounces and changes direction VERY quickly. This is area where the imbalance was very strong.

Look at another area where price consolidates some, and then bounces. Here, we had a weaker imbalance.

Look at continuation moves, where price does a quick pullback for a bar or two and then continues = strong imbalance
Look at contination moves, where price stops, consolidates some, then break and continues = weaker imbalance

Now look what happens when price revisits the same areas and spot the differences between the weaker areas and the stronger ones.

Now add the volume and closing prices (price behaviour) into this equation as a confluent factor
There is no edge in trading. Your edge is understanding risk
  • #55
  • May 14, 2019 2:52am May 14, 2019 2:52am
Here are some simple examples.
Attached Image(s) (click to enlarge)
Click to Enlarge Name: imbalance1.png Size: 70 KB
Click to Enlarge Name: imbalance2.png Size: 64 KB
There is no edge in trading. Your edge is understanding risk
  • #56
  • May 14, 2019 6:56am May 14, 2019 6:56am
Quoting naviafra
Here are some simple examples.
I'm here because I've not found volume to be useful to me in my analysis up to this point, so I'm trying to learn something new.

I look at the second example and I see a small volume on the retest on the NY open.

So where is the trade?

Sure there is a big move away eventually on high volume but I presume you wanted to get in after the retest on a high volume? Which isn't there... Or am I missing something?

Looking at other charts it seems that almost always the NY open and London open have a volume spike so it feels like assigning value to something that doesn't mean that much. Could it be better to simply consider the time of the entry?
New Simulation
  • #57
  • May 14, 2019 7:04am May 14, 2019 7:04am
Quoting NewSim
{quote} I'm here because I've not found volume to be useful to me in my analysis up to this point, so I'm trying to learn something new. I look at the second example and I see a small volume on the retest on the NY open. So where is the trade? Sure there is a big move away eventually on high volume but I presume you wanted to get in after the retest on a high volume? Which isn't there... Or am I missing something? Looking at other charts it seems that almost always the NY open and London open have a volume spike so it feels like assigning value...
On Chart number 2 entry is on point 3. Volume does not give us very much in forex, however, as it is activity and activity increases in certain key areas of a chart accompanied by price reaction/closing prices that support your prediction and ALSO on a previous area of strong imbalance, this will add to your probability of succcess.

In chart 2 where I said entry is on point 3 the storyline is

1. Strong imbalance as price stalls for a short while and it shoots up. Buyers HEAVILY outnumbered sellers.
2. Price retraces down to previous zone of interest, and it does this during night time so the volume will be low, definately nothing there of value.
However, it is a pretty hefty bounce to the upside, almost to previous top. This is a very bullish sign. Price retraces down VERY carefully and slowly. This causes BALANCE, the sellers are NOT to strong.
3. Price quickly dips on decent volume into the same zone once more after we had 2 successful signs of strength in the background and signs that buyers are outnumbering sellers. The close of this dip is important and the reaction. There is your long entry.

Did that make sense?
There is no edge in trading. Your edge is understanding risk
  • #58
  • May 14, 2019 7:29am May 14, 2019 7:29am
Quoting naviafra
Did that make sense?
Not really. I can't see that a bounce in night time that doesn't take out any structure is very bullish. I also can't see that the dip is on decent volume, seems about the same as you'd see elsewhere at the same time of day. The close of the candle pointed out doesn't seem that relevant either. There is a tail on it but it closes within the rectangle, and I'd have thought if you were looking for a strong reaction then you'd want it to close above it.
New Simulation
  • #59
  • May 14, 2019 7:39am May 14, 2019 7:39am
Quoting NewSim
{quote} Not really. I can't see that a bounce in night time that doesn't take out any structure is very bullish. I also can't see that the dip is on decent volume, seems about the same as you'd see elsewhere at the same time of day. The close of the candle pointed out doesn't seem that relevant either. There is a tail on it but it closes within the rectangle, and I'd have thought if you were looking for a strong reaction then you'd want it to close above it.
I lost track here now.

The dip is not on low vol, the close is around 50% of that bar and the reaction is bullish closing higher than the previous bar. The volume does not need to be very high here but it is still decent, cannot say it is low.

The most important thing here is the bounche during night time, it comes up and is not met by strong selling which pushes price down
There is no edge in trading. Your edge is understanding risk
  • #60
  • May 14, 2019 7:54am May 14, 2019 7:54am
Quoting naviafra
{quote} I lost track here now. The dip is not on low vol, the close is around 50% of that bar and the reaction is bullish closing higher than the previous bar. The volume does not need to be very high here but it is still decent, cannot say it is low. The most important thing here is the bounche during night time, it comes up and is not met by strong selling which pushes price down
Hmm can't say I'm convinced, it sounds a lot like confirmation bias to me.
Did you take this trade for real or is it just an example?
Do you keep stats that confirm that filtering by volume is a good idea?
New Simulation
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