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vsa with Malcolm

  • #15,541
  • Mar 9, 2011 7:51am Mar 9, 2011 7:51am
Quoting amletit
hmmm on that test bar my volume was slightly higher then previous. What is your broker?
Tadawul fx... we can have a higher vol test too, doesn't always have to be lower.
Today's zone = Tomorrow's opportunity!
  • #15,542
  • Mar 9, 2011 7:54am Mar 9, 2011 7:54am
Quoting pres78
Tadawul fx... we can have a higher vol test too, doesn't always have to be lower.
I know. But i am not confident with higher vol tests....because I don't understand them
  • #15,543
  • Mar 9, 2011 7:58am Mar 9, 2011 7:58am
Having a hard time keeping up with the trades and charts... took this long off the quite apparent NS marked with the red line.

The upbar right before closed back above the PAL and the 50 fib. Took this trade after some obvious buying had been happening on the 15 min... which also got me out of my short trade earlier.

Only took 1 lot as it is getting later in the day so I risked 1:1 for 20 pips to match my SL.

Well that's my two trades taken today...
Attached Image
Today's zone = Tomorrow's opportunity!
  • #15,544
  • Mar 9, 2011 7:59am Mar 9, 2011 7:59am
as i understand it higher vol tests can indicate buying within the bar, or it may indicate supply still there. if there is supply still there then it will likely come back to that level again soon and make double bottom.

i dont think theres any way to tell whether it was buying or supply without waiting to see if it double bottoms or not, by which time, if it was buying and it doesnt double bottom, then youve missed it. so i always like to take the first one, if it comes back down on low volume im happy to sit on it and wait, if it comes back down on higher volume and looks like it
might break, ill exit for a small loss. sometimes if i miss the first one it may come back again and ill get in on the second one, but only if i miss it the first time.
  • #15,545
  • Mar 9, 2011 8:00am Mar 9, 2011 8:00am
Quoting amletit
I know. But i am not confident with higher vol tests....because I don't understand them
I like all tests you just need to look at them differently... low volume tests show lack of selling where as higher vol tests show that there is buying happening since it closed on it's high and above the trigger. The bar pushed down to test that trigger level and was rejected on increased vol.
Today's zone = Tomorrow's opportunity!
  • #15,546
  • Mar 9, 2011 8:04am Mar 9, 2011 8:04am
Not sure if this has ever been posted on here but it has some nice information with respect to SOW and SOS... Might be of interest to other new VSA traders such as myself.
Attached File(s)
File Type: pdf toms_vsa_principles[1].pdf   127 KB | 1,237 downloads
Today's zone = Tomorrow's opportunity!
  • #15,547
  • Mar 9, 2011 8:04am Mar 9, 2011 8:04am
thanx both. I will start and look at them.
  • #15,548
  • Mar 9, 2011 8:05am Mar 9, 2011 8:05am
Quoting Intel
GU M5

Any thing wrong with this chart analysis?
Thanks for having a go guys. Mostly correct answers but some incorrect also. I have labelled another chart below with a handy setup very similar to the one I posted the question about. 1 is the question setup and 2 is the better setup.

The correct answer is, the background just isn't strong enough. The strength I have indicated and the NSP are correct but no where near enough to initiate a reversal. When you add this to the fact that we have just pushed through a support level, it should tell us that we are having a minor retrace to test that level. The 'mark down' bar is actually a weak bar(increased volume on increased spread closing near the low, pushing through support).

So why did setup 2 work then? Well there are some differences in he setup like the 2 bar volumes and the NS all being better. But, the main difference is that setup 2 has setup 1 in the background and setup 1 does not. As I said earlier, setup 1 was not string enough to make the reversal but it makes a great sign of strength for the setup 2.

How many times do you see a reversal and enter, only to see your SL get hit, then bam off it goes in your direction??? You will find this happens over and over again and will be the cause of many a SL being hit with these trades.

It is ESSENTIAL that we see the correct signs in the background before we even think about entering.
Attached Image (click to enlarge)
Click to Enlarge Name: 206.png Size: 174 KB
  • #15,549
  • Mar 9, 2011 8:06am Mar 9, 2011 8:06am
Quoting ewokuk
as i understand it higher vol tests can indicate buying within the bar, or it may indicate supply still there....
Check out your 5 min gu chart, an example of a high volume test which was than immediately tested just happened. Now the key is follow through in the next few bars, you want to see less volume on down bars and more on up with a trend continuation.
  • #15,550
  • Mar 9, 2011 8:10am Mar 9, 2011 8:10am
Quoting Intel
Thanks for having a go guys. Mostly correct answers but some incorrect also. I have labelled another chart below with a handy setup very similar to the one I posted the question about. 1 is the question setup and 2 is the better setup.

The correct answer is, the background just isn't strong enough. The strength I have indicated and the NSP are correct but no where near enough to initiate a reversal. When you add this to the fact that we have just pushed through a support level, it should tell us that we are having a minor retrace to test that...
Superb analysis as always... got into this long but a little later and high up.
Today's zone = Tomorrow's opportunity!
  • #15,551
  • Mar 9, 2011 8:14am Mar 9, 2011 8:14am
Quoting ewokuk
as i understand it higher vol tests can indicate buying within the bar, or it may indicate supply still there. if there is supply still there then it will likely come back to that level again soon and make double bottom.

i dont think theres any way to tell whether it was buying or supply without waiting to see if it double bottoms or not, by which time, if it was buying and it doesnt double bottom, then youve missed it. so i always like to take the first one, if it comes back down on low volume im happy to sit on it and wait, if it comes back...
Did you read it first time around?
  • #15,552
  • Mar 9, 2011 8:17am Mar 9, 2011 8:17am
Quoting pres78
Superb analysis as always... got into this long but a little later and high up.
Well done.

The 2nd setup is a classic 2 bar reversal, almost perfect. It would have been nice to see a wide spread down bar closing in the middle on high volume, between setup 1 and 2. But then it would be the stuff text books are made of
  • #15,553
  • Mar 9, 2011 8:20am Mar 9, 2011 8:20am
Quoting amletit
hmmm on that test bar my volume was slightly higher then previous. What is your broker?
Also it's all in comparison too... the vol on the test bar I marked on my broker was the lowest in the last 4 bars which shows that we have been moving down but on reduced vol that ended as a test bar. In addittion to that I also keep in mind that I am on a 5 min chart but I am testing on this trade set-up a 15min trigger that was the highest vol bar for me today and over 4 times the volume of what I saw when I tested this level on the 5min...
Today's zone = Tomorrow's opportunity!
  • #15,554
  • Mar 9, 2011 8:21am Mar 9, 2011 8:21am
Quoting Intel
Well done.

The 2nd setup is a classic 2 bar reversal, almost perfect. It would have been nice to see a wide spread down bar closing in the middle on high volume, between setup 1 and 2. But then it would be the stuff text books are made of
Well now SM can't make it that easy for us now can they.
Today's zone = Tomorrow's opportunity!
  • #15,555
  • Mar 9, 2011 8:30am Mar 9, 2011 8:30am
Quoting pres78
Well now SM can't make it that easy for us now can they.


Mind you, it was easy enough today. There were fantastic trades a plenty today. Would have been a 20% day for me had I been trading
  • #15,556
  • Mar 9, 2011 8:33am Mar 9, 2011 8:33am
Quoting Intel


Mind you, it was easy enough today. There were fantastic trades a plenty today. Would have been a 20% day for me had I been trading
Yes not bad for set-ups on two pairs that have moved well under the normal ADR's... Any idea when you might get back to trading again?
Today's zone = Tomorrow's opportunity!
  • #15,557
  • Mar 9, 2011 8:35am Mar 9, 2011 8:35am
A question I just had via PM

'Just a question. If next bar breaks the lows of a ns the setup is still valid ?

Same for a (next) bar breaking the highs of a ND?'

If you're talking about the setups I have shown today, yes they would still be valid provided the SO low hasn't been breached or too much time has elapsed without a break of the high of the NS.
  • #15,558
  • Mar 9, 2011 8:38am Mar 9, 2011 8:38am
Quoting pres78
Yes not bad for set-ups on two pairs that have moved well under the normal ADR's... Any idea when you might get back to trading again?
Not really. I suppose I could make some trades here and there but I don't really have the time to dedicate to trading right now. It's a little difficult at the moment and my attentions are elsewhere.
  • #15,559
  • Mar 9, 2011 8:40am Mar 9, 2011 8:40am
Quoting Intel
Not really. I suppose I could make some trades here and there but I don't really have the time to dedicate to trading right now. It's a little difficult at the moment and my attentions are elsewhere.

Ah well hopefully at some point you can get back at it...

It's well appreciated around this thread I am sure that you still take the time to pop in and share your thoughts and charts.
Today's zone = Tomorrow's opportunity!
  • #15,560
  • Mar 9, 2011 8:44am Mar 9, 2011 8:44am
Quoting pres78
Ah well hopefully at some point you can get back at it...

It's well appreciated around this thread I am sure that you still take the time to pop in and share your thoughts and charts.
Thanks.

I also cannot play much golf now either so FF and the markets provide me with a welcome break every now and then.
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