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vsa with Malcolm

  • #1,201
  • Edited 2:08pm Jul 9, 2010 1:43pm | Edited 2:08pm
seems to me sm is accumulating hard on the EU. 1.265 looks like a brick wall and i don't think noone is trying to buy above that: it's just being absorbed by the sm.

question, for me is when. still today? gap over the weekend? or accumulating still through asia monday?

the bigger the accumulation the bigger the subsequent move...

remains to be seen...
dreams do come true.
  • #1,202
  • Jul 9, 2010 10:04pm Jul 9, 2010 10:04pm
Quoting Bethel
can some1 please tell me why i got stopped out?

i entered when i saw tt the down trend has started and the circled part - isn't tt a retrace as its a no demand up bar? =(

struggling...

Bethel
Bethel, I have attached a chart.

The first thing to note is that we had a high volume down candle closing in the upper portion of its range with the next candle up. This is strength. In fact, this candle is stopping volume. Not the time to get long, but we have just seen a major sign of STRENGTH. two candles later we do have a low volume up candle. But this is not No Demand. Why? Well first off the range is not narrow ,it is actually increasing, on this candle so at best it is no buying pressure. More importantly, however, we have just seen a sign of strength. We have to be aware that you do often get narrow range up candles after a stopping volume candle/end of the down move but they are "out of place".

The market meanders a bit then we start to see some real signs of strength. We see a down candle on volume less than the previous two candles-No Supply. This candle is followed by a Test which is also a Key Reversal Bar. Then prices move above the BPL and we get another down candle on volume less than the previous two. Note this time the volume bar is yellow. Very low volume indeed.
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Without VSA, you're playing checkers while the Smart Money plays chess.
  • #1,203
  • Jul 9, 2010 10:49pm Jul 9, 2010 10:49pm
I amn off on vacation for a week , but before I leave I will throw this one out there

weekly low volume , alright closing on lows and some could say it is a test , but look at 2nd chart. The weekly indicates a distinct lack of buy interest in the 5200 are.

daily wide spread up , then I mentioned last week possible end of rising market , narrow spread ultra high vol , this sent market sideways three days then dropped it . Today 140 pip drop any secret ??/ no not really we saw it coming 5 days ago. ... this top could take another few days to for,. I am in with + 20 pip stop up at 5200 , target 1.4600 or sdto out 20

good luck out there and hopefully the more experienced vsaers like intel and HG can hold the vsa torch in my absence


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Blogging daily now at www.volume.zone
  • #1,204
  • Jul 9, 2010 10:50pm Jul 9, 2010 10:50pm
Quoting Bethel
can some1 please tell me why i got stopped out?

i entered when i saw tt the down trend has started and the circled part - isn't tt a retrace as its a no demand up bar? =(

struggling...

Bethel
hgk covered this one well , that was stopping vol
Blogging daily now at www.volume.zone
  • #1,205
  • Jul 10, 2010 1:47am Jul 10, 2010 1:47am
Quoting bruceli
intel, sir, i ve a question ... where sm takes profit ? do they finish TP before or at the top ?? if yes, what does markin down mean just after top ?

besides, we always assume that, buy at low, sell at high.. couldnt they make the reverse ? sell at high ? buy at low... ? i mean, they can manage this play on two ways ?

cheers..
SM are always taking profit, its one big circle for them. In our previous scenario, they had bought all the supply at lower prices which forced the price up(supply and demand dynamics). When the price is high enough they will sell off at a profit.

Then they will decide whether they will re accumulate or distribute, if they're distributing, they will follow that with a mark down of prices so they can take a profit.
  • #1,206
  • Jul 10, 2010 5:08am Jul 10, 2010 5:08am
Quoting Intel
SM are always taking profit, its one big circle for them. In our previous scenario, they had bought all the supply at lower prices which forced the price up(supply and demand dynamics). When the price is high enough they will sell off at a profit.

Then they will decide whether they will re accumulate or distribute, if they're distributing, they will follow that with a mark down of prices so they can take a profit.
yes, always they take profits, at all levels, during rallies, or falls.. cause they have always orders to be taken profits.. whether bought at lows, or sold at highs.. these are the same..

mark up or down, they are the same actually then... 2 way game for them, but they always get profit..

so, for distribution, they should have sell orders in hand, so they should cover with buy orders, therefore, somebody should sell... in order to make people involved in the mark down and shorted, they firstly mark down price immediately like an ignite to downwards, and they dump all sell order to the public....

meantime, i am sorry, what i ve written above is how i understand whats going on.. is it right ?

thanx sir for your reply and interest...
  • #1,207
  • Jul 10, 2010 8:59am Jul 10, 2010 8:59am
Quoting bruceli
.......

so, for distribution, they should have sell orders in hand, so they should cover with buy orders, therefore, somebody should sell... in order to make people involved in the mark down and shorted, they firstly mark down price immediately like an ignite to downwards, and they dump all sell order to the public....

meantime, i am sorry, what i ve written above is how i understand whats going on.. is it right ?

thanx sir for your reply and interest...
Not quite Bruce,

If they have sell orders the first thing they will do is mark the price UP.
This will entice the herd to start buying and give SM the best price possible. SM will then gladly SELL into this buying, swamping the market with supply and forcing prices down.

Once the price has reached an acceptable level they will start covering the short orders by buying.
  • #1,208
  • Edited 10:29am Jul 10, 2010 9:06am | Edited 10:29am
Quoting malcolmb14
I amn off on vacation for a week , but before I leave I will throw this one out there

weekly low volume , alright closing on lows and some could say it is a test , but look at 2nd chart. The weekly indicates a distinct lack of buy interest in the 5200 are.

daily wide spread up , then I mentioned last week possible end of rising market , narrow spread ultra high vol , this sent market sideways three days then dropped it . Today 140 pip drop any secret ??/ no not really we saw it coming 5 days ago. ... this top could take another few days to...

Oh flamin typical, I wont be here much this week either due to work committments.

Over to you HG


Happy hols Mal
  • #1,209
  • Jul 10, 2010 11:19am Jul 10, 2010 11:19am
wwoo this is correct and scary , I see that GU can reach 13000 on weekly chart

Quoting malcolmb14
I amn off on vacation for a week , but before I leave I will throw this one out there

weekly low volume , alright closing on lows and some could say it is a test , but look at 2nd chart. The weekly indicates a distinct lack of buy interest in the 5200 are.

daily wide spread up , then I mentioned last week possible end of rising market , narrow spread ultra high vol , this sent market sideways three days then dropped it . Today 140 pip drop any secret ??/ no not really we saw it coming 5 days ago. ... this top could take another few days to...
  • #1,210
  • Jul 10, 2010 12:17pm Jul 10, 2010 12:17pm
thank you kamise, lower, raverstyle, hg and malc for the insights, yup, i read mtm, and re-reading, yup. Thank you so much so much for your time! =)

anyway, is it alright if any senior traders can help me with this question?

http://www.forexfactory.com/showpost...postcount=1170

yours sincerely,
Bethel


Quoting lower
As others pointed there was no reason to short.After no demand you need confirmation that its really a no demand. Always wait for result.In this case expected result of no demand (and continuing selling) was downbar closed lower as ND low with high vol.For conservative entry u need to wait for break below stopping vol bar low.

Effort vs Result.Supply vs Demand.Have u read MTM already??
  • #1,211
  • Edited 12:56pm Jul 10, 2010 12:30pm | Edited 12:56pm
Quoting HiddenGap
Bethel, I have attached a chart.

The first thing to note is that we had a high volume down candle closing in the upper portion of its range with the next candle up. This is strength. In fact, this candle is stopping volume. Not the time to get long, but we have just seen a major sign of STRENGTH. two candles later we do have a low volume up candle. But this is not No Demand. Why? Well first off the range is not narrow ,it is actually increasing, on this candle so at best it is no buying pressure. More importantly, however, we have just seen...
Hello, HiddenGap!!!
Will you be so kind to explain me why "Test (KRB)" on your chart is sign of strength? For me there is no buying force.... like a "ND"! Please, help!

Thank You!!!
  • #1,212
  • Jul 10, 2010 7:37pm Jul 10, 2010 7:37pm
I am new to the thread, HG - great explanation.
Can please tel me what is BPL?
Thanks

Quoting HiddenGap
Bethel, I have attached a chart.

The first thing to note is that we had a high volume down candle closing in the upper portion of its range with the next candle up. This is strength. In fact, this candle is stopping volume. Not the time to get long, but we have just seen a major sign of STRENGTH. two candles later we do have a low volume up candle. But this is not No Demand. Why? Well first off the range is not narrow ,it is actually increasing, on this candle so at best it is no buying pressure. More importantly, however, we have just seen a...
  • #1,213
  • Jul 10, 2010 7:39pm Jul 10, 2010 7:39pm
Quoting Bethel
Dear senior traders, malc, hg, intel, f451 and all,

i hope you will help me here because im confused over my bias for short or long at times....many times...and sometimes i wonder if its only me having such an issue.

Just trading 1 tf alone n ignoring al other tfs, i am able to understand UT, RUT, weakness in background as uptrend is seen etc.. but that is definitely unwise because multiple TFs are always encouraged.

This is one of my many problems as i trade. Which side do i take? short or long

When i turn up to daily, 4hrly, 1 hrly, all...
Well Bethal my friend, this is a fairly simple one...........it's up to you!

If a particular TF has a good short setup and the appropriate entry occurs, then enter a short. Its that simple.

The problem arises when you try to decide when to exit. As a general rule of thumb, if the shorter TF is offering a trade in the same direction as the larger TFs, you will PROBABLY be in the trade for longer. If the shorter TF is offering a trade in the opposite direction to the larger TFs, you will PROBABLY be in for a shorter period of time because you will probably be trading a retrace.

Ther are a ton of traders out there who will not trade against the larger TFs IE: Malcom used to say not to trade against the direction of the daily bar.(not sure if he still advocates this) he said it saved him many losing trades.

He may have ditched this in favour of the Hulls approach.

But it's really up to you and how comfortable you are with trading against the larger TFs.
  • #1,214
  • Jul 10, 2010 9:22pm Jul 10, 2010 9:22pm
Quoting V_2008
Hello, HiddenGap!!!
Will you be so kind to explain me why "Test (KRB)" on your chart is sign of strength? For me there is no buying force.... like a "ND"! Please, help!

Thank You!!!
Let's start with some definitions:

(1) No Demand: a narrow range UP candle on volume less than the previous two candles, that closes in the middle or low of its range.

(2) Test: a narrow range DOWN candle on volume less than the previous two candles, that closes in the middle or high of its range.

The next two definitions are technically not VSA terms, but they are very important.

(3) Buying Bar: a bar/candle that makes a higher high and not a lower low than the previous bar/candle.

(4) Selling Bar: a bar/candle that makes a lower low and not a higher high than the previous bar/candle.

These two are very important in herd mentality. A bar/candle making a higher high but not a lower low is seen as strong (regardless of volume-most people don't properly understand volume after all). And a bar/candle making a lower low but not a higher high is seen as weak.

Let's put (4) & (2) together:

We have a narrow range down candle that makes a lower low and not a higher high on volume less than the previous two candles that closes on its high. This is the most ideal test. The BBs mark the market down (making a lower low) in search of supply. If supply is present, the move down will attract it. In other words, the move down will attract sellers. Finding none, the BBs proceed to mark the market back up and it closes on or near the high.

From the herd's point of view, the candle makes a lower low and closed lower so it must be weakness. After all, if the market is making lower lows it can't be in an uptrend. The BBs understand this thinking. It is, after all, on its face true. But the key to a test is the fact that the move down, to lower lows in this case was manipulated. That is to say, the market did not fall because of the weight of sellers, it was taken down by potential buyers looking for sellers.

Although the psychology is DIFFERENT with No Demand, the ideal No Demand will be a narrow range up bar/candle that will make a higher high than the previous bar/candle and not a lower low on volume less than the previous two bars/candles closing in the middle or low. Again, No Demand is not the mirror of a test. No Supply is the mirror of a No Demand. Both show lack of professional activity. And when in the correct place, not only a lack of activity but also a disinterest in lower or higher prices respectively.

Now we can get to what is actually on that chart- A hidden test. What makes it hidden? In a nutshell, the fact that it closes UP and not down. I should mention here that us VSA users that also use candles have a bit of an edge. We can see that this candle opens lower than the previous candle yet closes higher than the previous close as well as higher than its own open. This is a key reversal bar. Again, not VSA as VSA does not look at the open. But let's think about what has already been said about a test. The market is marked down to find supply, and upon finding none, is marked back up to close on or near the high. We see this action in the KRB. Another important aspect of a KRB is that it makes a lower low.

I have mentioned before that I do not like No demands that make lower lows and not higher highs (selling bars (4)). The reason is if the market closes higher the No demand is not confirmed and it is more likely that it is a hidden test. If the next candle does close down it is really more of a failed hidden test, but we still say No Demand. Stepping back a bit further, I don't like them because a selling bar is used to fool the herd into thinking weakness when the market is actually strong. A No Demand that is a selling bar would sort of defeat the advantage gained by creating the idea of strength (up candle, making a higher high) in the mind of the herd.

The next element to take into account is : background strength or weakness. Because of the stopping volume and other down candles showing strength, one has to conclude that this candle is not No Demand even though it is an up candle on volume less than the previous two. Even if you did think this candle was No Demand, it is not confirmed on the next interval as the next interval is up.
Without VSA, you're playing checkers while the Smart Money plays chess.
  • #1,215
  • Jul 11, 2010 9:02am Jul 11, 2010 9:02am
Quoting HiddenGap
Let's start with some definitions:

(1) No Demand: a narrow range UP candle on volume less than the previous two candles, that closes in the middle or low of its range.

(2) Test: a narrow range DOWN candle on volume less than the previous two candles, that closes in the middle or high of its range.

The next two definitions are technically not VSA terms, but they are very important.

(3) Buying Bar: a bar/candle that makes a higher high and not a lower low than the previous bar/candle.

(4) Selling Bar: a bar/candle that makes a...
Thank You very much for a such huge and very informative post!!!!!!

So, maybe I'm not so bad student....

Am I right? Is this bar a "Test bar"?
Or it is not, because of the next bar is down?
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  • #1,216
  • Jul 11, 2010 10:33am Jul 11, 2010 10:33am
Quoting V_2008
Thank You very much for a such huge and very informative post!!!!!!

So, maybe I'm not so bad student....

Am I right? Is this bar a "Test bar"?
Or it is not, because of the next bar is down?
Based on your chart it is a test that has appeared to have failed. With tests we really like need to see an immediate upside reaction to consider it a successful test. Technically immediate would mean the next couple of intervals, but for practical purposes we tend to look at the very next interval.

Therefore one would have to call that a failed test as the next interval is not up.

That next interval is a narrow range down candle on increasing volume. It is a squat a sign of strength. Here again we run into that situation where this is a buying bar (higher high and not a lower low) when we would rather see this be a selling bar (lower low and not higher high). At any rate, it is a sign of some strength despite that it causes the test to fail. The next candle will be key. If it is up, we can change our minds on the test. We can say it was successful. This would not mean get long, however. You would still need to see a change in trend as defined by a change in the color and direction of the Hull MA. Then you would want to see a narrow range down bar on volume less than the previous two as an entry signal.

On my chart, the next interval is down but the volume is decreasing. This makes it more of a no supply than a squat.

Either way, sideways to up price action would not surprise me even though the test has "failed". As soon as you see a close below the low of the test candle, however, you know the market is weak.
Without VSA, you're playing checkers while the Smart Money plays chess.
  • #1,217
  • Jul 11, 2010 11:00am Jul 11, 2010 11:00am
Quoting HiddenGap
Based on your chart it is a test that has appeared to have failed. With tests we really like need to see an immediate upside reaction to consider it a successful test. Technically immediate would mean the next couple of intervals, but for practical purposes we tend to look at the very next interval.

Therefore one would have to call that a failed test as the next interval is not up.

That next interval is a narrow range down candle on increasing volume. It is a squat a sign of strength. Here again we run into that situation where this is a buying...
Thanks for the valuable info
I'm interested with VSA so i add to my system and Watching....
Does it matter wich TF to use vsa? Mostly as i know higher TF is better view is that the same for VSA?
  • #1,218
  • Jul 11, 2010 11:01am Jul 11, 2010 11:01am
Quoting HiddenGap
Based on your chart it is a test that has appeared to have failed. With tests we really like need to see an immediate upside reaction to consider it a successful test. Technically immediate would mean the next couple of intervals, but for practical purposes we tend to look at the very next interval.

Therefore one would have to call that a failed test as the next interval is not up.

That next interval is a narrow range down candle on increasing volume. It is a squat a sign of strength. Here again we run into that situation where this is a...
on daily or weekly basis, GU market seems weak, however, can this be a temporary strength ? weakness - strenthg also relative issue, as in a up trend
we used to see dips are bought which buyers come and support up trend as occured so far for gu till lets say 2 weeks ago thursday... (last 5-6 days were sideaways after that 250-300 pips up move)...

also, we have seen in last 5-6 days 1,5090 was support and in these areas bought and we have seen some 100-150 pips increase during these rangind days..

so, we may see probably some increase again in monday ... however, keeping in mind the weakness in the background, this stenght would not last if we dont see further temporary (i said temprorary, because, daily or weekly chart tells there is weakness in the background, and in longt term we ve weakness, and very short term may be daily have "temproray daily" strength...

this is the way i think now...

i am not sure, and the edge makes me afraid for any long position on daily basis..

what do you think so Hidden Gap ?

Intel, i ve seen you now, what do you think as well sir ?

cheers..
  • #1,219
  • Jul 11, 2010 11:23am Jul 11, 2010 11:23am
I don't trade GBP. I was answering a question and only looked at the chart interval shown.

You may well be correct about the higher timeframe weakness. As I recall mal showed a chart with a possible "end of rising market" on the GBP daily chart last week.

The 1 hour certainly can't "shoot to the moon" if the daily is weak, but that does not mean there could not be some up movement on the hourly that a trader can take advantage of in the mist of greater weakness on a higher timeframe.
Without VSA, you're playing checkers while the Smart Money plays chess.
  • #1,220
  • Jul 11, 2010 11:32am Jul 11, 2010 11:32am
Quoting HiddenGap
I don't trade GBP. I was answering a question and only looked at the chart interval shown.

You may well be correct about the higher timeframe weakness. As I recall mal showed a chart with a possible "end of rising market" on the GBP daily chart last week.

The 1 hour certainly can't "shoot to the moon" if the daily is weak, but that does not mean there could not be some up movement on the hourly that a trader can take advantage of in the mist of greater weakness on a higher timeframe.
thank you sir...
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