vsa with Malcolm

ok thanks malcolm for all your post..clearly im gonna have to go back and re-read the mtm book again..i was hoping after reading it i could at least follow along, but it aint workin out like that....LOL...back to the book!!! best regards, TX
my how quickly things go from sugar to sh#t so quickly in this game!!!!

as always..your post are geniunely appreciated!!! i understand and thanks...best regards, TX

position trade is based on weekly charts...

and i day trade es , it is one of my fav things to trade when i have time to day trade it

Something cooking at 4220, whether they are absorbing supply here for another run at 4280 or getting ready to drop it I cant say. There is a large amount of supply at 4290 enough that a news spike bar was not able to penetrate.

The gu seems to be the weaker of the 2 at the moment with a nice nd on the 5 min, 3 bars back.

you see sono i would have never seen that drop like that...but after you explain it makes perfect since!!! im seriously trying to learn to veiw the market as ya'll do...these are my only intentions. best regards, TX

they bought it back to that clear buying of 1.4220 that we saw this morning ...

MY bet we are seeing accumulation...

seeing a nice run here on uj as my charts earlier, should be massive stops above 82

sono since you made the uj call...is the highlighted candle in my chart an attempt by SM to scare weak holders into closing there trades, using news or otherwise??? regards, TX

Hi all,

Amazing watching you guys,really it is.

malcolm,sono,pres and all the vsa experts here are really opening my eyes,im beginning to become a believer

I also thought i saw the supply at 4280 area and then i believe it was an upthrust on the news if im not mistaken,weakness was already in the backround.....not trading it, just watching you guys and taking notes

Then in the 4220 area we had something which resembled a shakeout/stopping volume/no supply kinda rolled together into 2 or 3 bars.

Right now im unsure,i suppose i watch and wait to see what price does at either 4220 or 4280..

Just a few thoughts,maybe you guys can tell me if im seeing things in the right way,will get there slowly,but surely

All in hindsight i know but this is a journey,im reading master the markets again but this time watching you guys in here too so that i can try to see the set-ups...

Its not important for me to trade at this time,i just want to be able to see the set-ups in advance,learn when to get in(and as malcolm has shown already when he saw volume coming in at 4220)when to get out.

Keep up the great work here in this thread,you all are very much appreciated.

H4 EU seems accumulation to me too, now we need a wickoff specialist to give us a target.

Okay Trader X, you've kicked the cage and awoken the sleeping bear. LOL

The subject of stops and target prices are not usually touched because both are very personal.

But let's be clear: VSA (the market) ALMOST ALWAYS tells you where the ideal place to put your stop is. Unfortunately, there are a few harsh realities that one must understand in view this place.

* The market does not care about your account size.
* The market does not care about your tolerance for risk.

The best place to put your stop may be 80 pips away from your entry. Now that might represent more than 2% of your account. So what? The market is a friendly place and will provide, but it does not care about your artificial 2% rule.
The rule is artificial or arbitrary because it is based on your account size and not what the market is actually telling you.

Take a look at the chart below.

This chart was not intended for this post but it makes a good example.

First note the nice Key Reversal Bar (KRB). Very nice. Let's suppose you saw that and thus became bearish looking for a NO Demand entry. (You are not the hyper aggressive type to sell on this bar). Three (3) intervals later you have a No Demand bar. Now, the ideal place to put your stop is actually one tick above the high of the KRB.
If price moves back up to the high of the KRB/Up Thrust then you can be pretty sure you are wrong. Sellers showed up on that bar and you would expect that they would "defend" this price area. Now, VSA would tell us that an Up Thrust is manufactured in the first place and is therefore not real. So if price moves back into and above this area, you would have to conclude that it is real this time.

This is a lot of risk for many traders. Many VSAers will thus attempt to place a stop just above the high of the No Demand. One has to be careful here because many times the market will Up Thrust on the next interval for the expressed purpose of stopping out those who can read a chart but can't stand any heat.

On this chart, while it is not an Up Thrust, you can see that the next interval did make a higher high and would have stopped out many. And as the market traded higher, did it tell you anything new? No. That's because the key price level is not one tick above the high of the No Demand, it is much higher....

I am going to add something here that may seem conciliatory, but it is not.

Take a look at the two Tests in blue. The first test "passes" as the next bar is
level. This level bar is a Test itself. Unlike the first one, this one is on increasing volume. Now if you were thinking that the trend has been up and therefore you are still only looking for longs, you might enter on one of these tests. The actual entry would be on the next bar that makes a higher high than the test(s) bars.

This bar is the No Demand with the Selling Shadow. In this case the correct place to put your stop would be just below the lows of the test bar. If you look to the left you will not seen any "pivots" or reaction lows so the market is not directing you to an ideal location for your stop.

Now we get advanced.

If the market trades (closes) lower than the lows of the Test on a bar that is a WRB and 2-5 intervals after the successful test, then you have No Result from a Test and should be reversing your position to short. Especially when the WRB is engulfing the body of the test candle.

Even if you had placed your stop further away, the appearance of No Result from a Test should cause you to get short. Again, this is market information and has nothing to do with account size.

One more.

Two intervals after the Effort to Fall is an unmarked No Demand. The ideal (market generated) place to put a stop now becomes just above the No Demand with the Selling Shadow. This is the most recent "pivot/fractal" high.

Hope you get the idea. There almost always is a "best stop" location based on market information. You may or may not be able to stomach it. That's not the market's problem. It's yours and mine, and most retail traders. That's what makes this game difficult.

With all that said, asking Malc about his stops makes no sense. I know his account is larger than yours and I know he has more trust in his own analysis and trading skills. You are not him (yet ), so why would you expect your stop losses to be the same?

Have to say while I see your here that I am very grateful you contribute. You have a very clear and comprehensive understanding that lends itself to your clear incisive posts. I have been reading all your posts starting back from 2009 and am most enlightend. an would encourage anyone to undertake this tedious process for it is all here.

Yep lot of words to say thankyou.

Anybody that uses Infinity Futures as a broker and is using the free data feed, please take a look at the volume here and let me know if it looks like what you have on your charts. Thanks.

*Edit* the times are EST.

Hi Malcomb,

I was looking at 4hour and 8hour charts of GBP/CAD and I noticed a few things:

1. we have massive compression in both of these TF's (i.e. either accumulation or distribution for a BIG move since it has occurred in higher TF's)

2. The weekly Gann was green and just turned red, but if you look at the weekly volume, it looks like testing; Considering the fact that the volume is declining, this scenario could be valid.

3. Also we are at the bottom of this triangle in which the PA has been bouncing up and down.

Now, as you can see, this is a nasty situation, so I zoomed into lower TF, H4, and saw the reaction of PA to high volume bars; it seems that there are more buyers at the end; Do you mind to take a look at the charts and analyze my analysis?

HiddenGap,
Are you using Infinity's charting platform?
Nevermind this, i googled EW and found Ensign charting platform.

I am still curious about this though...
Also I have a question about the volume indicator. I have seen this a few times on this board and am curious about it.

What is it called, and how do you use the part of it which is salmon in color.
It appears it is almost like a standard deviation of volume bars, allowing you to spot the HV bars more easily.

Thanks

dude....thank you! not only for all the valuable information but for the time and effort it took to put all that together...im gonna print it out re-read it until i fully get it...but i do get the basic idea! that is an excellant explanation and makes alot of sense ..really appreciate it!!! i got 4 explanations from 4 great VSA traders and while each one was a bit different than the other the common denominator in them all seems to be account size + comfort zone(risk tolerance)...of them all yours seems to be quite accurate in the fact that it is the "ugly truth"!!... nothing else about the market is suited or designed for the little guy.... especially SL!! so as much as that sucks for us, thats the way it is!!! if you want to play , you gotta find a way to make work it out...80 SL would be out of my range, so id have to wait on another trade...but the trade malcolm posted today was about 25..i can live with that! also i personally dont like rr 1;1...i suppose a really confident trader is ok with that, but 2;1 is my minimum...anyway thanks again for the schooling...it is appreciated..best regards TX

not knowledgeable in VSA, but just reading Gavin's new book, it looks like a "shakeout" of weak holders, high volume suggests demand overcame the supply.
If volume was low it would signal higher prices (it shows supply has disappeared).
Now volume is high it's likely to test that supply area (81.40) again.
Any low volume testing back into the area of the shakeout would be a strong SOS
Hope VSA-guru's correct me if I'm wrong

Nice post HG and good to see you back in the ol VSA thread ... now does this mean I will have some competition for the most long winded posts ...

Seriously though you always put down some great thoughts.

have re-read your post several times now..i can follow it all the way up to the "advanced section", then things get alittle confusing...but thats just my lack of knowledge and experience with vsa ..i will continue to study it though..i especially like the part with the 2 test..i can clearly see where a person thinkinf long would fall for that...thats an excellant example...as for "asking malcolm about his stop makes no sense"....lol...if i hadnt of asked how would i have ever gotten all this great information...best regards and thanks again for the lesson...best regards, TX

Seeing as there seems to be an influx of newer people to the thread, this chart represents a follow up to the intro me and Pres gave on trigger numbers a couple of days ago.

Generally we take the trigger line from the close of the high volume bar but we can also take it from the high or low. Here's an example of 5min GU today, using the news bar from 9:30am my time this morning and a trigger number/line on the low of the bar. I didn't actually trade this because I didn't have the trigger drawn in so missed it! Only saw it whilst looking over the charts later in the day.

The second ND would be my preferred entry. The PA for the first one hasn't made a clear move away from the trigger and come back on ND. In fact now I think about it more, i'd disregard the first ND I have marked and pay more attention to the second.