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Trade Using VSA (Volume Spread Analysis)

  • #1,681
  • Jun 6, 2009 8:02pm Jun 6, 2009 8:02pm
I agree. I even asked a former professional bank trader. We are trading on retail platforms. Do you think the "smart money" is trading on a retail platform with fixed spreads against a deal desk? If a forex broker actually posted real tick by tick trade volume then it would be easy to calculate their order flow. Do you believe any broker would allow that to happen? I don't think a real edge can be gained using this approach. Has any statistical analysis been done?
  • #1,682
  • Edited 8:19pm Jun 6, 2009 8:05pm | Edited 8:19pm
A long time ago I asked in programming discussion if it was possible to combine multiple broker feeds into one so that we might have a better picture of volume across many brokers.

All of the potential solutions seemed a bit too time intensive and clunky.

I think I've figured it out without the need for custom dll's etc (thanks noggin). I need to wait until markets open on Sunday evening to test the theory but if it works which I am pretty sure it will I'll post up how to do it.
The trend always ends.
  • #1,683
  • Jun 6, 2009 8:06pm Jun 6, 2009 8:06pm
Quoting markmm
Yeah, indicators cant predict shit. Remove all indicators and use price action.

I've already got that covered but thanks. lol
The trend always ends.
  • #1,684
  • Jun 6, 2009 8:11pm Jun 6, 2009 8:11pm
Quoting PipForceA
I agree. I even asked a former professional bank trader. We are trading on retail platforms. Do you think the "smart money" is trading on a retail platform with fixed spreads against a deal desk? If a forex broker actually posted real tick by tick trade volume then it would be easy to calculate their order flow. Do you believe any broker would allow that to happen? I don't think a real edge can be gained using this approach. Has any statistical analysis been done?

Let's not let this thread turn into an argument whether volume (tick data) in forex can be used for VSA, that happened in the last thread and was 8 pages of pointless time wasting for everyone.

If you don't think it can... fine. I know for a fact it can. If you think I'm wrong, try it yourself... that way your argument on whether it works or not will be based on facts not what *you think*.

ps hi.
The trend always ends.
  • #1,685
  • Jun 6, 2009 8:14pm Jun 6, 2009 8:14pm
Quoting ShamusFamous
Let's not let this thread turn into an argument whether volume (tick data) in forex can be used for VSA, that happened in the last thread and was 8 pages of pointless time wasting for everyone.

If you don't think it can... fine. I know for a fact it can. If you think I'm wrong, try it yourself... that way your argument on whether it works or not will be based on facts not what *you think*.

ps hi.
No argument. Please tell me what the expectancy of this method is then.
  • #1,686
  • Jun 6, 2009 8:18pm Jun 6, 2009 8:18pm
Quoting PipForceA
No argument. Please tell me what the expectancy of this method is then.
The same as any other "method"... to make more than you lose.
The trend always ends.
  • #1,687
  • Jun 6, 2009 8:50pm Jun 6, 2009 8:50pm
Quoting ShamusFamous
The same as any other "method"... to make more than you lose.
Perhaps you were joking with your answer but my question was serious.

Trading 101: Expectancy

By Michael on May 19, 2004 6:33 PM

Expectancy along with position sizing are probably the two most important factors in trading/investing success. Sadly most people have never even heard of the concept. Out of the 30 or so trading books I've read only a few even touch on any aspect of money management. Only one of those handful of books discussed expectancy. In simple terms, expectancy is the average amount you can expect to win (or lose) per dollar at risk. Here's the formula for expectancy:

Expectancy = (Probability of Win * Average Win) - (Probability of Loss * Average Loss)


Based on your analysis of this method, what is its mathematical expectancy? Perhaps you can provide the variables and the sample size.




  • #1,688
  • Edited 9:27pm Jun 6, 2009 9:17pm | Edited 9:27pm
Quoting PipForceA
Perhaps you were joking with your answer but my question was serious.

Trading 101: Expectancy

By Michael on May 19, 2004 6:33 PM

Expectancy along with position sizing are probably the two most important factors in trading/investing success. Sadly most people have never even heard of the concept. Out of the 30 or so trading books I've read only a few even touch on any aspect of money management. Only one of those handful of books discussed expectancy. In simple terms, expectancy is the average amount you can expect to win (or...

As most people here and in chat know... I am a complete goofball so yes I was joking... but this is a thread for the discussion of VSA only. I imagine most people would apply their own formula for MM so it seems pointless to discuss it here since no one answer will be the same for everyone and it detracts from the main purpose of this thread.

I *would* suggest going through a couple of the articles in the first post and take a look at some charts. Once you start to *see* what's happening VSAwise then perhaps you can gauge your own expectancy based on this method which is all that matters.

I would also suggest starting a thread dealing with expectancy as it pertains to individual traders, methods/systems, and goals if that is your interest.

http://gallery.pipbuilders.com/main..../movealong.jpg
The trend always ends.
  • #1,689
  • Jun 6, 2009 9:45pm Jun 6, 2009 9:45pm
Forget this expectancy crap formula, that's for noobs that don't know how to trade successfully trying to codify a chaotic state, all trades are different and stand on their. Who is this Michael anyway and what quailifies him to be teaching how to trade? LOL

Quoting ShamusFamous
As most people here and in chat know... I am a complete goofball so yes I was joking... but this is a thread for the discussion of VSA only. I imagine most people would apply their own formula for MM so it seems pointless to discuss it here since no one answer will be the same for everyone and it detracts from the main purpose of this thread.

I *would* suggest going through a couple of the articles in the first post and take a look at some charts. Once you start to *see* what's happening VSAwise then perhaps you can gauge your own expectancy...
  • #1,690
  • Jun 6, 2009 9:49pm Jun 6, 2009 9:49pm
Quoting wwwin
Forget this expectancy crap formula, that's for noobs that don't know how to trade successfully trying to codify a chaotic state. Who is this Michael anywayt and what quailifies him to be teaching how to trade? LOL
How do you trade successfully? I am all eyes.
  • #1,691
  • Jun 6, 2009 10:14pm Jun 6, 2009 10:14pm
Quoting PipForceA
How do you trade successfully? I am all eyes.
Like this...
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  • #1,692
  • Jun 6, 2009 10:24pm Jun 6, 2009 10:24pm
Quoting wwwin
Like this...
I guess my English is poor. I didn't ask for you to post your trading record. When I asked how you trade successfully it was an inquiry about your trading method. Meaning entry signal, exit signal, money management, risk management, position size and anything else pertinent to your success.
  • #1,693
  • Jun 6, 2009 10:51pm Jun 6, 2009 10:51pm
I am not qualified to teach anybody anything. Just as soon as they would learn all the answers, all the questions would change. Everyone has to learn on their own by trial an error and what works for them. As I wrote above "you can't codify a chaotic state, each trade stands on it's own".
My point for posting was this. Shamus started a thread. He posted a book about the system. He posted articles explaining the method. A template, and opened a chat room. He invites discussion about the system...He is not drawing lines and refusing to tell you how he does it to later try to charge for the calls, as some others here at FF have tried to do....I personally tried the method he posted with good results...whether its volume or ticks or whatever volume is in forex, I find it helpful.

Quoting PipForceA
I guess my English is poor. I didn't ask for you to post your trading record. When I asked how you trade successfully it was an inquiry about your trading method. Meaning entry signal, exit signal, money management, risk management, position size and anything else pertinent to your success.
  • #1,694
  • Jun 7, 2009 1:16am Jun 7, 2009 1:16am
While you and 'Michael' derive very clever and I might add labour intensive formulas to calculate expectancy or whatever....I have have mastered the art of the simple pocket calculator. 150p+200p+150p+200p = New subscription to Dr Phil's "How to be effective in the work place" webinar.

Just kidding .... but seriously... we as fx traders have this insane need to over complicate matters. We can't seem to accept the fact that some things are really just "that easy".

And as the old addage goes "Don't knock it till you've tried it"....thats how I got onto the crackpipe....lol


Quoting PipForceA
I guess my English is poor. I didn't ask for you to post your trading record. When I asked how you trade successfully it was an inquiry about your trading method. Meaning entry signal, exit signal, money management, risk management, position size and anything else pertinent to your success.
  • #1,695
  • Edited 4:28am Jun 7, 2009 4:12am | Edited 4:28am
Aaaaaaaaaaaaaa......not again!!!
This is my old account statement from the old vsa thread.(posted zip)
Tick Volume......it simply sucks!

EDIT; this was posted by Obaidah in another thread......the following are H1 charts from esignal and MT4 broker, how interesting it is that their volumes data is just the same. (remove the latest bar from esignal chart because MT4 closed before it was formed and compare the data), just look for good data providers.

I also made a extensive reasearch on this subject, and I can guarrante to everyone that "most" of mt4 brokers ofers tick volume that is around 80-90% accurate.....
also take a note that the bigger TF you use, the more accurate the signal is!!!

Regards
Attached Image(s) (click to enlarge)
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Attached File(s)
File Type: zip Statement.zip   4 KB | 563 downloads
forexflash
  • #1,696
  • Jun 7, 2009 5:53am Jun 7, 2009 5:53am
Quoting ShamusFamous
Let's not let this thread turn into an argument whether volume (tick data) in forex can be used for VSA, that happened in the last thread and was 8 pages of pointless time wasting for everyone.

If you don't think it can... fine. I know for a fact it can. If you think I'm wrong, try it yourself... that way your argument on whether it works or not will be based on facts not what *you think*.

ps hi.
I agree shamus, can we get these pointless posts removed and the individuals barred? It just makes the thread unreadable, which is frustrating when there is so much good stuff in it
  • #1,697
  • Jun 7, 2009 5:54am Jun 7, 2009 5:54am
I just coded another toy....dont get angry, but it seems that alot people
here use ma of RSX...so I coded a indi that will color candlesticks using the trend from RSXma!
(you dont need rsx indi cos it is hardcoded into indicator!!!)

Regards
Attached File(s)
File Type: mq4 VSAŠ RSX BARS.mq4   6 KB | 1,478 downloads
forexflash
  • #1,698
  • Jun 7, 2009 6:25am Jun 7, 2009 6:25am
Quoting FOREXflash
Aaaaaaaaaaaaaa......not again!!!
This is my old account statement from the old vsa thread.(posted zip)
Tick Volume......it simply sucks!

EDIT; this was posted by Obaidah in another thread......the following are H1 charts from esignal and MT4 broker, how interesting it is that their volumes data is just the same. (remove the latest bar from esignal chart because MT4 closed before it was formed and compare the data), just look for good data providers.

I also made a extensive reasearch on this subject, and I can guarrante...

Hi FOREXflash.

Please could you check your email.

Respects.

D8d3
  • #1,699
  • Jun 7, 2009 9:58am Jun 7, 2009 9:58am
Quoting wallst500
While you and 'Michael' derive very clever and I might add labour intensive formulas to calculate expectancy or whatever....I have have mastered the art of the simple pocket calculator. 150p+200p+150p+200p = New subscription to Dr Phil's "How to be effective in the work place" webinar.

Just kidding .... but seriously... we as fx traders have this insane need to over complicate matters. We can't seem to accept the fact that some things are really just "that easy".

And as the old addage goes "Don't knock it till you've tried it"....thats...
We have different humor types. Tolerance for questions here seems to be low. I ask questions to learn and understand. The expectancy formulas were derived centuries ago.

I do like your signature quote. "My first rule is not to lose money. Losing an opportunity is minor in comparison, there will be more opportunities." It sounds like wisdom from age and experience.
  • #1,700
  • Jun 7, 2009 10:23am Jun 7, 2009 10:23am
actually there is - first, interpret tick volume (which works to some extent, trust me); and second, get a broker that gives you access to level 2 market depth (ever heard of that ?).

Quoting markmm
Just to let you guys know, there is no way to know volume in forex. I know this voids the whole thread but its better now than another 2000 posts.
Nihil Sine Deo.
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