Trade Using VSA (Volume Spread Analysis)

this one is simple .... nothing really wrong with the trade other than you choose to short on one candle on a 5 min chart when the background has been buying all US session as oil takes off ....

try and trade with the trend of the session and you cannot go wrong

ont weay up there were several low volume test etc .... the pros have been buying this one.

not sure is asia is going to move her up to 1.6500 or not

Thanks guys...I can see from your comments why that was a low percentage trade. Interesting that the same strategy would have worked a few bars later as mentioned, although that was a far more clear upthrust into new territory.

Trading with the trend for sure is what I need to do. Sometimes I get messed up though when the trend in Euro session completely reverses in US session. So following "trend of the session" as Malcolmb stated sounds good.

But thanks again to the 3 that responded; I do appreciate each response!

You should check your background first and then wait for confirmation. You may lose a few pips while waiting but its worth it in the long run.

I am having this.. “I told you so” moment…

Sonic

Thanks for all the responses. This is how the thread should be.


Here's my perspective:

I don't like no demands that make lower lows. In Hindsight, I would call that candle a Key Reversal Bar/Hidden Test that fails.

As a KRB, it makes a lower low, opens higher than the previous candle's close, closes higher than the previous close and its own open and closes slightly off the high. I would be looking to enter on the next candle on a breach of the KRB's high, which does not happen.

As a Hidden Test, it makes a lower low, closes up and near its high, and has volume less than the previous two candles. Again, the next candle does not make a higher high to bring us into the market. More importantly, we do not get confirmation on the next two candles with closes higher than the close of the hidden test candle.

At the time, I think I was too concerned with looking for the No Demand to see the obvious weakness that was presenting itself.

AUD chart from FXCM - left using marketscope charts and the right with MT4.

Does the difference in the big red candle change anything with respect to VSA?

Here is what IBFX have to say about their volume feed:

Thank you for contacting us. The next available agent will be right with you.
You are now chatting with 'Client Services 70'
Client Services 70: Thank you for contacting IBFX. My name is Brian. How may I help you?
NONE: hey mate, i've been using your IBFX demo server, but i notice since early this year your volume bars on the daily are tiny
NONE: its the only thing stopping me from signing up a live account
NONE: did you change liquidity providers or what?
Client Services 70: We change our liquidity providers every once in a while, but I don't know that I could tell you the exact time we made a change last time.
NONE: do you have a D1 chart open? they all look the same. between may of this year till september the daily volume looks normal before and after that the volume is tiny. i use volume heavily in my trading and specifically want to sign up with IBFX because of your aggregate feed
NONE: otherwise i might as well stay with my current broker and get an esignal feed?
Client Services 70: My supervisor says that Volume on the platform is essentially just a count of the number of ticks that happened during that particular candle.
NONE: well he is right, but you guys have some of the best tick volume available. it looks pretty accurate on say, the M15, you can definitely notice big orders hitting the market, but when you zoom out to the D1 it doesnt look right
Client Services 70: The volume bars are set at a relative size... so if all of the volume bars in a chart are say 3, then a volume of 10 would look huge...
Client Services 70: But then a day chart is dealing in tens of thousands of ticks so the scale changes dramatically from that of a 15 minute chart.
Client Services 70: Also, with the volume of ticks, it has no representation of the actual volume of the trades that caused those ticks.
Client Services 70: Meaning that particular tick could ahve been caused by a $100 trade (unlikely) or a $10 million trade.
NONE: yes, im not sure you understand what i mean. as an example, the volume for 2009-09-04 was 102085 the next day was 1069
NONE: i really doubt your feed only took in 1000 ticks on the 5th sept of this year?
Client Services 70: To what specific currency pair for the D1 do you refer?
NONE: i am looking currently at EUR/JPY but they all look the same
NONE: in terms of volume
NONE: im pretty surprised nobody has asked you about this before
Client Services 70: September 4, 2009 was a Friday.
Client Services 70: IBFX closes trading for the weekend.
NONE: well then look at september 7, only 15,000 ticks in a day?
Client Services 70: When IBFX opens on Sundays, it opens at 6 p.m. EST, which is about 22:00 GMT depending on Daylight Savings Time. This means that Sundays only include a few hours of trading.
NONE: but you can clearly see on your chart what im talking about right? your volume feed for the period after september 4 is vastly different to the volume feed for the period march-sept
NONE: regardless of the day
NONE: im logged into IBFX MT4-demo1 5dec
NONE: but im pretty sure demo2 looks the same
Client Services 70: I can name a couple of our liquidity providers to you by name...
Client Services 70: Morgan Chase, Bank of America, and Citi
Client Services 70: Wouldn't you classify those liquidity providers as organizations that can offer adequate liquidity?
NONE: definitely
NONE: just wondering why your volume feed looks so vastly different for those period
Client Services 70: I don't know what to say other than explain that some days are slower than others.
NONE: you're telling me that since september you guys have been turning over 10% of what you did for the 4 months prior?
Client Services 70: Sundays are traditionally considered to be slower than others especially..
Client Services 70: WHere are you looking on your platform to determine volume?
NONE: open the chart, click D1, in the indicators menu go to the volumes section and click volumes
Client Services 70: So you are using the Volumes Indicator?
NONE: yes
Client Services 70: Don't know what to tell you. The volume just kind of is what it is.
Client Services 70: Have you ever heard about the third-party web page of www.babypips.com ?
Client Services 70: Babypips.com provides a good resource to identify some trading times that are of lower volume. Here is the link:
Client Services 70: http://www.babypips.com/school/when_...ose_money.html
Client Services 70: This might just be a restating the obvious though.

FYI I use an ODL demo account for volume, and I think it's accurate. By accurate, I mean that I have matched up my charts and volume bars with charts that Malcolmb14 posts from esignal, and they are virtually identical. I don't know what Hidden Gap uses, but I did the same with his charts, and my and his volume bars also matched quite well.

I only use the demo and wouldn't want to trade a live account with ODL, but just passing that on as an fyi for what it's worth...

funny, from what i know ibfx is not a ecn broker so with the risk to repeat myself i never understood why everybody on this thread vote for esignal and ibfx volume feed...how a market maker could provide you a better feed then a ecn broker? and haw esignal it's better if you don't use their buy/sell report? can somebody help me here, am i missing something?

somebody, anybody?

Hello HiddenGap,
i have question to You regarding entry.

You are saying:

As a Hidden Test, it makes a lower low, closes up and near its high, and has volume less than the previous two candles. Again, the next candle does not make a higher high to bring us into the market. More importantly, we do not get confirmation on the next two candles with closes higher than the close of the hidden test candle.

My question from that is:

1) What if high of hidden test is broken on second candle not on the first candle -Would that break be Your entry ?

1.1) As You are taking entries within WRB, then in any case - Your SL would be at the low of WRB ?

Thank You for Your comments.


Best,
Tom

1) Whilst things can change on that first candle after the test, generally speaking I would use a breach of the high by the next candle as an entry signal.

If it doesn't come on the second candle, it's time to re-evalute the situation. And the first question becomes, "Did the test (hidden) fail?".

1.1) Yes. My stop would normally be placed just below the low of the S/D Zone.

BUY trade on N/$ using VSA.

I'm using VSA to complement my ABCD pattern entry. Still not sure what the exact "technical terms" are for each candles associated with it, but I'm beginning to see them.

Thank You for reply.

But then i have next question :

If first candle after the test breach high of test candle and NEXT ( 2nd ) candle is NOT closing above test - That would mean re-evalute the situation and perhaps to exit ?

Best,
Tom

The main what i want to show is starts at 4.35 ( 1-2 minutes talking ).





To someone it will be interested to some not.

Enjoy


Best,
Tom

Hello all,
am just happy and surprised to hear a new phrase : "trend of the session". This sounds helpful and new to me.Thanks 4 the "asker" and the "answerer=malcomb14"
Hope to build my team with it-www.70yrsforexfocus.blog.com

Goodwings - some new ideas for scam for 70 yrs ?

If not, sorry, i just asked...

Best,
Tom

Possible fake pump up??

Sonic

Why woudn't you want to trade live with ODL ? I confirm that ODL volume is at 95% the same as esignal, I have esignal and ODL.

Having introduced a friend of mine to my chart package, he soon discovered that it did this:-