Does anybody suggest any Volume Spread Analysis Indicators? | Forex Factory

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Does anybody suggest any Volume Spread Analysis Indicators?

  • #1
  • First Post: Jul 14, 2008 11:44am Jul 14, 2008 11:44am
Hello

Does anybody here use any VSA indicator for trading?
  • #2
  • Jul 14, 2008 6:41pm Jul 14, 2008 6:41pm
Quoting hariusa72
Hello

Does anybody here use any VSA indicator for trading?
Not yet but I'm thinking of one that maybe have some use.
  • #3
  • Jul 16, 2008 1:06am Jul 16, 2008 1:06am
How can VSA be applied to forex, anyway? Doesn't VSA, by it's definition, analyze volume? Without a centralized exchange to track volume, what possible meanings can we get from broker-provided volume data?
  • #4
  • Jul 16, 2008 5:18pm Jul 16, 2008 5:18pm
Quoting Rabid
How can VSA be applied to forex, anyway? Doesn't VSA, by it's definition, analyze volume? Without a centralized exchange to track volume, what possible meanings can we get from broker-provided volume data?
Are you Trading on a "Centralized Exchange"?

I know it's Tick {movement} Volume; But It's Your Borker's Tick Volume.
  • #5
  • Jul 16, 2008 5:47pm Jul 16, 2008 5:47pm
Quote
Are you Trading on a "Centralized Exchange"?
I know it's Tick {movement} Volume; But It's Your Borker's Tick Volume.

Obviously not, lol. IS it tick volume at the broker (I've heard otherwise about MT4)? And what's that saying exactly?

It was my understanding that VSA is designed to try and follow the "big dogs" to provide some insight into accumulation/distribution phases. Certainly a useful tool in a place where you spend large chunks of time ranging. But if the volume info you're getting is just other specs at your broker, and clearly nobody can accumulate enough in forex to effect the float like you can in stocks (big or small), how can you do traditional VSA?

Now I can certainly check the volume on a double top to see the 2nd rally is fading and stuff like that (not sure how reliable that info is tho), but to my understanding that's not VSA. Tdion brought up the idea of using COT volume data in place of a broker's data a while back, not sure if that went very far tho... and not sure if we could use it apply a form of VSA.

But so yea, my question is this... how is it possible to do VSA in forex and what conclusions can we reliably gather from the use of broker volume data?
  • #6
  • Sep 24, 2008 8:24am Sep 24, 2008 8:24am
Quoting Rabid

But so yea, my question is this... how is it possible to do VSA in forex and what conclusions can we reliably gather from the use of broker volume data?
Obviously, no one has the answer to this question !

I wish I did, but hopefully some wise trader will answer the question for both for us !!
  • #7
  • Oct 29, 2008 12:29pm Oct 29, 2008 12:29pm
You are correct; there is no way of measuring true volume in forex. However, using tick count for volume measurement and it is 80% as accurate as true volume. Of course, any volume indicator will calculate the volume per bar or the volume average per bar to show who is in control of that bar. The difference with the VSA from typical volume is the measurement of volume per x amount of bars, plus a standard deviation. This allows us to see when buyers or sellers are coming into the market earlier.
  • #8
  • Oct 29, 2008 12:37pm Oct 29, 2008 12:37pm
Quoting hariusa72
However, using tick count for volume measurement and it is 80% as accurate as true volume.
Who says that?
  • #9
  • Oct 29, 2008 12:39pm Oct 29, 2008 12:39pm
Quoting Willowgal
Obviously, no one has the answer to this question !

I wish I did, but hopefully some wise trader will answer the question for both for us !!

You might check the posts by Dr Geppynious in Auslanco's thread - some discussion there on volume whilst waiting for The Fed.

Also, "esignal would be a good start for volume since it includes composite volume information of 308 contributing forex brokers and interbanks."
Trading Levels with WRBs
  • #10
  • Feb 21, 2009 1:04am Feb 21, 2009 1:04am
Quoting Rabid
How can VSA be applied to forex, anyway? Doesn't VSA, by it's definition, analyze volume? Without a centralized exchange to track volume, what possible meanings can we get from broker-provided volume data?
Buddy which ever trading platform you utilize to trade forex it shows the volume of each bar when you highlight the individual bars with the arrow. It gives the OHLC and volume. Thats all you need to use VSA
  • #11
  • Feb 21, 2009 5:32am Feb 21, 2009 5:32am
Quote
Buddy which ever trading platform you utilize to trade forex it shows the volume of each bar when you highlight the individual bars with the arrow. It gives the OHLC and volume. Thats all you need to use VSA

Yea, but that's fantasy volume. It's tick volume generated by the broker, which means there's no "big dog" information there... it's all information generated by other local traders at your broker.

VSA works well in stocks, to be sure. A lot of people use that, especially combined with level 2 data, to determine when someone big is coming into the market. That approach used to work insanely well, but people are getting better at breaking up their big orders because they're sick of getting coat-tailed.

I have a hard time seeing how volume data would work the same way in forex. I guess maybe it doesn't matter, I don't know, but it seems like you can't do the same analysis. Now some brokers, like IB, have an order book function. Perhaps something like that could be used in a similar way.
  • #12
  • Feb 21, 2009 8:27am Feb 21, 2009 8:27am
Quoting Rabid
How can VSA be applied to forex, anyway? Doesn't VSA, by it's definition, analyze volume? Without a centralized exchange to track volume, what possible meanings can we get from broker-provided volume data?

I don't use that, but I have seen a lot of people using it and they are very good traders. So, yes it's possible.

And there is a reason for everything, you can always know the "why". Always.
Why do we fall? "So we can learn to pick ourselves up."
  • #13
  • Feb 21, 2009 8:34am Feb 21, 2009 8:34am
Quoting ForexDude
I don't use that, but I have seen a lot of people using it and they are very good traders. So, yes it's possible.

And there is a reason for everything, you can always know the "why". Always.
They may use Volume from Futures Market (which still is not real volume) but certainly not some poor ass bucketshop MT4 volume. It's utterly useless you could aswell just plot some random numbers.
  • #14
  • Feb 21, 2009 8:51am Feb 21, 2009 8:51am
Quoting Tjpld
They may use Volume from Futures Market (which still is not real volume) but certainly not some poor ass bucketshop MT4 volume. It's utterly useless you could aswell just plot some random numbers.
I've seen one volume system on here that used volume from currency futures.
I'll try to find it and edit this post to identify it.

As far as I know, volume figures given out by futures exchanges are accurate, but there is a lot I don't know.
  • #15
  • Feb 21, 2009 9:13am Feb 21, 2009 9:13am
Quoting billbss
I've seen one volume system on here that used volume from currency futures.
I'll try to find it and edit this post to identify it.

As far as I know, volume figures given out by futures exchanges are accurate, but there is a lot I don't know.
Of course they are "more accurate" than what you will see on your MT4, because no 500M Dollar Hedge Fund trades at IBFX or Alpari. Institutional Traders trade big amouts via CME for example. Still there is alot of volume which is not
counted because it does not go through CME. If Airbus wants to hedge a 1 Bln USD deal with another country or if you run to your bank and exchange
your money for a holiday trip abroad or if your government needs to buy dollars from china which increases the demand for dollars etc etc etc. This is Volume which is impossible to keep track of.
  • #16
  • Feb 21, 2009 10:43am Feb 21, 2009 10:43am
I would venture to say that no one here has read Williams' book. If they had, they would already know that tick volume is what VSA uses in FOREX. Netdania has it free. FXCM says theirs is from liquidity providers, e siignal has it for about $40 per month. MB volume is from ECNS ticks. There are several sources and it is exactly what is used. This type of argument just shows that the book has not been read and understood.

Read the book. It is a very price driven method and is very reliable.
  • #17
  • Feb 21, 2009 10:49am Feb 21, 2009 10:49am
Quoting thatwasme
I would venture to say that no one here has read Williams' book. If they had, they would already know that tick volume is what VSA uses in FOREX.
It still misses ALOT of important volume. PERIOD.
And with ALOT I really mean ALOT.
  • #18
  • Feb 21, 2009 10:52am Feb 21, 2009 10:52am
Nonsense. Read the book. This is from page 27

esignal volume is what their program uses.
Attached File(s)
File Type: pdf Master The Marketspage 27.pdf   118 KB | 2,060 downloads
  • #19
  • Feb 21, 2009 10:53am Feb 21, 2009 10:53am
Quote
The U.S. budget deficit is financed by borrowing. More and more of that money comes from China, now the United States' second-largest lender, after Japan. China's investment in U.S. government debt has more than tripled in the past five years, from $71 billion in 2000 to $242 billion in 2005.
Lol show me how your ingenious Tick Volume repesents buying of a quarter trillion dollars.
In the recent years it was close to 900 Billion. Oh well I guess we can ignore such peanuts.
  • #20
  • Feb 21, 2009 10:54am Feb 21, 2009 10:54am
Quoting Tjpld
Lol show me how your ingenious Tick Volume repesents buying of a quarter trillion dollars.
You obviously do not understand this method, so there is no point discussing it with you until you read the book.

I have read your posts and know you are a good trader, but you are not getting the point of this system.

I think if you read the material, you will change your mind as your argument has no validity in this context.
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