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Trade Using VSA (Volume Spread Analysis)

  • #5,961
  • Mar 20, 2010 8:19am Mar 20, 2010 8:19am
I wasn't there though

www.tradeguider.com/gavin_webinar_files/pfg2.wmv
  • #5,962
  • Mar 20, 2010 10:38am Mar 20, 2010 10:38am
here is daily DJ

No demand bar followed by a high volumes down candle , we need to see follow thru of this weakness Monday with either

1) Down day dropping under Fridays low
2) upthrust on the day
3) end of a rising market or another no demand daily

right now I am taking this 2 bar set up close to resistance as weakness in the markets

Attached Image (click to enlarge)
Click to Enlarge Name: chart1998.png Size: 189 KB
Blogging daily now at www.volume.zone
  • #5,963
  • Mar 20, 2010 11:01am Mar 20, 2010 11:01am
Quoting Twiitch
I wasn't there though

www.tradeguider.com/gavin_webinar_files/pfg2.wmv

cheers for the link, enjoyed it a lot.

Gez
Seek not to change the world; seek only to change your mind about the world
  • #5,964
  • Mar 20, 2010 11:27am Mar 20, 2010 11:27am
Quoting gez40
cheers for the link, enjoyed it a lot.

Gez

Did you see the vid?

I get an 'invalid page' massage.
  • #5,965
  • Mar 20, 2010 11:32am Mar 20, 2010 11:32am
Quoting malcolmb14
here is daily DJ

No demand bar followed by a high volumes down candle , we need to see follow thru of this weakness Monday with either

1) Down day dropping under Fridays low
2) upthrust on the day
3) end of a rising market or another no demand daily

right now I am taking this 2 bar set up close to resistance as weakness in the markets

Attachment

If you see one of the bars you mentioned on monday, will you enter at the close of the bar or wait for something else?
  • #5,966
  • Mar 20, 2010 11:46am Mar 20, 2010 11:46am
Quoting Intel
If you see one of the bars you mentioned on monday, will you enter at the close of the bar or wait for something else?

I may look for any weakness intraday on a lower time frame

To take a longer term trade I will be looking for the day to end and may be entering on Tuesday . really all depends on how market plays out Monday
Blogging daily now at www.volume.zone
  • #5,967
  • Mar 20, 2010 11:55am Mar 20, 2010 11:55am
Quoting malcolmb14
I may look for any weakness intraday on a lower time frame

To take a longer term trade I will be looking for the day to end and may be entering on Tuesday . really all depends on how market plays out Monday
I see.

For your number 1 bar (Down day dropping under Fridays low), are you looking for it to close lower than fridays low or just have a lower low?
  • #5,968
  • Mar 20, 2010 12:02pm Mar 20, 2010 12:02pm
Quoting Intel
Did you see the vid?

I get an 'invalid page' massage.
http://www.tradeguider.com/gavin_webinar_files/pfg2.wmv

try again with this link

Gez
Seek not to change the world; seek only to change your mind about the world
  • #5,969
  • Mar 20, 2010 4:36pm Mar 20, 2010 4:36pm
Quoting akkubhai
I attended the TG free webinar today, during the webinar he mentioned he looked at a VSA thread here at FF and didn't think the thread was teaching it properly... wonder why would he say so..

Teach vsa properly or profitably? I have not subscribed to Trader Guider and do not think it is a prerequisite to learn to trade this method effectively. If one does not understand the the basics of VSA and study MTM, VSA will be confusing whether you have the software or not. Software is as smart or as dumb as it is programmed and never substitute for human decision making.

VSA is not easy by any means. I looked at it once, gave up and then the second time around it finally stuck with me and now I can't look at a chart without a volume histogram.

IMHO location of trade is by far the most important part of a trade. Location means looking to the left of your chart as Malcolmb says. Most of my trades are taken using VSA but I also take many trades with a limit order the first time price reaches an area where I am almost certain there will be a reaction. This is not VSA, but understanding market dynamics, and supply/demand. 90% of the time when I see volume coming in the market, it is in an area where I expected it.
  • #5,970
  • Mar 20, 2010 6:37pm Mar 20, 2010 6:37pm
I posted GU chart 60-min and 5-min. When price reacts sharply off an area, I always look to the left to see why. This will train your eyes to see future moves from similar areas. Price moves from imbalances of supply and demand.

I attached the 60-min chart not to show trades but to show some areas where reactions were expected Friday and indeed happened. It is not a coincidence. Even in a drop like we had Friday these areas were honored but I would never want to trade long or fade such momentum. To help me with smaller timeframes, I always mark the areas that are visible on the 1-hour timeframe. Areas that serve as support then resistance, and tops of consolidations are good. This keeps me focused on major areas that can be seen by many traders. And most of the time keeps me focused on the edges of the chart which is huge.

I attached a five minute chart just to show that even though the 60 min chart did not show a bounce from the 1.5120 area that had "good background" and 61 % fib retracement, the 5 min clearly did, as expected.

Again, I am not recommending trading areas like this in such momentum. Just showing an example of how I look for reactions.
Attached Image(s) (click to enlarge)
Click to Enlarge Name: 6B 06-10 3_19_2010 (60 Min).jpg Size: 159 KB
Click to Enlarge Name: 6B 06-10 3_19_2010 (5 Min).jpg Size: 126 KB
  • #5,971
  • Mar 20, 2010 8:11pm Mar 20, 2010 8:11pm
Quoting tarco
I posted GU chart 60-min and 5-min....
if i am not wrong, dow and cable go together. and previous post of Malcomb shows a probable weakness. then, the suspected weakness at dow confirmed then the price of GU would react to further downs to s4.

Am I right ?

In the meantime, we will see the whats going on dow several hours later from opening of london. of course assuming that, any change at dow will affect the cable. till opening of dow, we ll see some price action of GU, however, then we will see the real react of GU just after opening of Dow ?

sorry for my dummy questions

thanks all.
  • #5,972
  • Mar 20, 2010 9:18pm Mar 20, 2010 9:18pm
Bruceli,

From my observations, eu, gu and dow are somewhat correlated, some days more than others. I see a more distinct negaitive correlation with the Yen and dow. Aussie and Canadian dollar are correlated with Gold.

I would like to hear Malcolmbs and others observation on correlation and how they incorporate in their trading. I watch and notice these correlations, but not confident yet on how to use correlation in trading.

I have noticed for example if watching the Yen and Dow. If Yen gets weak and dow get strong at same time, a reversal is likely to happen. But for the most part I try to be very selective on the chart I am trading.
  • #5,973
  • Mar 20, 2010 10:07pm Mar 20, 2010 10:07pm
Hello Guys
Please help me, I have a basic question.

1. When there is a high volume suddently and there is a high down bar how do u know this is created by supply (sellers) or demand(buyers)

2. Say you have a upper close bar does the volume below indicate for demand or supply?

Any information or pdf on how to read volume would be much apprecated.

I know when there is literally no volume and a down bar happens we can call it is a no supply, but how do u know the volume shown is not dmand?

Thank for your help
  • #5,974
  • Mar 20, 2010 10:07pm Mar 20, 2010 10:07pm
Quoting tarco
Bruceli,

From my observations, eu, gu and dow are somewhat correlated, some days more than others....
thanks a lot Tarco, I'd better also follow and watch all togetger ...

I asked the same question to my brother, he is also forexer, and he also said that I only watch but he is not also confident how to use in trading.

he also mentioned about the deepness of the parities. the most intensive is eurusd. for eur-gbp there is no much traders, and it is very easy to play with it for speculators.i mean when you see a spike in eurgbp, on the other hand eurusd stays the same.

let me read more and more to understan you well.

thanks again for your expalantion.
  • #5,975
  • Mar 21, 2010 5:43am Mar 21, 2010 5:43am
Quoting gez40
http://www.tradeguider.com/gavin_webinar_files/pfg2.wmv

try again with this link

Gez

...lol, 1h 39mins into the video, quote from gavin...

" i was on a website the other day called forex factory.com, they have a big thread on VSA in there and some of the rubbish that they are writing in there is just wrong.... there are people in there who claim to be VSA experts and the stuff they are teaching just is`nt right"

made me giggle.

Gez
Seek not to change the world; seek only to change your mind about the world
  • #5,976
  • Mar 21, 2010 8:45am Mar 21, 2010 8:45am
i believe that we are getting something hidden and more real than lagging indis.
  • #5,977
  • Mar 21, 2010 10:00am Mar 21, 2010 10:00am
Quoting adler
Hello Guys
Please help me, I have a basic question.

1. When there is a high volume suddently and there is a high down bar how do u know this is created by supply (sellers) or demand(buyers)

2. Say you have a upper close bar does the volume below indicate for demand or supply?

Any information or pdf on how to read volume would be much apprecated.

I know when there is literally no volume and a down bar happens we can call it is a no supply, but how do u know the volume shown is not dmand?

Thank for your help

Alder,

You really need to read MTM by Tom Williams, then read it again study, and make notes until you have an understanding. There is more than enough posted by Shamus on the first page for you to be an expert at VSA. Let me tell you a few thoughts that helped me get VSA in my thick skull. All of these thoughts are repeated in MTM. You need to try to simplify this stuff to understand it or at least understand the premise to build a foundation for your learning. A couple of thinks that helped me which is nothing novel:

1. Think of the market in terms of, is the market strong or weak.
2. Strength shows itself on down-bars, weakness on up-bars.
3. In relation to #1 and #2, so if you wanting to go long you should make sure that the market is strong, for example.. looking for down bars on high volume then a confirmation by looking for a low volume no supply or test usually on a down bar to confirm the strength.
4. Most of the time...a down bar will be your signal to go long and an upbar will be your signal to go short.

This is a gross over simplification but in order to build a foundation, these simple thoughts helped me get over the hump. Also, make a Malcomb and Dr. G folder there are others that you will find are very good, print their posts out read them, and an hour or two later read them again. I had to live, eat and breath this stuff.
  • #5,978
  • Mar 21, 2010 10:11am Mar 21, 2010 10:11am
Quoting gez40
...lol, 1h 39mins into the video, quote from gavin...

" i was on a website the other day called forex factory.com, they have a big thread on VSA in there and some of the rubbish that they are writing in there is just wrong.... there are people in there who claim to be VSA experts and the stuff they are teaching just is`nt right"

made me giggle.

Gez
Sure some make posts and show charts that are not the best VSA trades. But thats ok, that is how we should learn. There is a lot to learn here and that is what makes VSA worth learning. I bet that 90% of the people that try to learn VSA give up. They will go back to MAs, oscillators, and the latest indicator. If you keep up with this thread, you get a feel of who are the experts and who are learning.
  • #5,979
  • Mar 21, 2010 12:28pm Mar 21, 2010 12:28pm
Quoting tarco
Sure some make posts and show charts that are not the best VSA trades. But thats ok, that is how we should learn. There is a lot to learn here and that is what makes VSA worth learning. I bet that 90% of the people that try to learn VSA give up. They will go back to MAs, oscillators, and the latest indicator. If you keep up with this thread, you get a feel of who are the experts and who are learning.
I think many have trouble learning VSA because its so different from other strategies. There are no snaky line crosses, no colorful buy sell dots and no hope for an EA. To add up to that one needs to understand market psychology, price action and VSA. And if that's not enough one needs to think about background and S/R on several different TFs.
But does that make it a looser.. of course not. Tom Williams might have spent years to learn and master it and he built a fortune (I think) on it. If he can so can we.
I spent this weekend reading this thread and watching the bootcamp videos (posted recently on this thread). Then went back to my charts and to my surprise the same charts looked completely different than they looked earlier. I hate saying this but after watching those bootcamp videos, I think they know what they are talking about and they certainly know what there club service is worth.
Now I am still a beginner at VSA but this is certainly the most leading indicator we know of. May not be easy but its certainly not impossible. All we need to do is stick to this thread keep practicing and bothering the pros
  • #5,980
  • Mar 21, 2010 1:40pm Mar 21, 2010 1:40pm
[quote=malcolmb14;3569131

also we do not teach vsa well in here was we do not charge 150 a month like the vsa clubs does. ..lol . But to be honest if you really want to learn off the pros the $150 is well worth it.[/quote]


yes you might not as good as tom williams,but the way you explain vsa with candle charts that makes more sense than bar charts and the better volume indicator is suffecient enough.....
and you know !!! you are far better instructor than gavin!!!
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