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vsa with Malcolm

  • #23,541
  • Edited 9:04am Dec 28, 2012 8:53am | Edited 9:04am
we are above 1.32099 ..

current action at my entry looks like asborbtion... `***
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still sellers arround...

now we have some activity.. and the result isnt in favour of my entry

sellers where able to keep price below,,,

and we are trading back to the key level 1.32099

wich holds for now.....

may act as springboard ?

cmon runs does stops above the smal UT..!!!

45mins.. till data release (pending home sales)

activity comin in.... highest vol.. since mins..

result .. narrow range... downbar..

not bearish thou.. as we are holding gains...!

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actually we made a series of higher lows.. thus far...

looking like a springboard action...


still all actions that took place are in favour of my position thou..

even taking the heat..
  • #23,542
  • Edited 9:06am Dec 28, 2012 8:54am | Edited 9:06am
puke bears , puke

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all right price grinds its way up to the recent high.. wheeras if we take it out i will pull SL to BE

there ya go .. break thru FTA .. and recent high.. pull SL to BE+

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TP is @ 1.32305

Jobs done





btw. TP got while posting this ,,,


PS sorry needed to break this down into three posts .. (image limit)
  • #23,543
  • Dec 28, 2012 1:19pm Dec 28, 2012 1:19pm
As I said in my last post, I am in favor of trading in the direction of the trend. So let's keep that in mind..........

Quoting Scipio
...you always talk about the importance of the backgrownd
For me, background is not just the high volume bars like Up Thrust, Supply coming in, or End of a Rising Market. Background includes the overall trend.

Quoting Scipio
...1 - During asian session, I see a wide sperad up candle on climatic volume that close slightly off the high, the next candle is up, it makes a HH, not a LL, but its range is very narrow and vol decreased. You have also to note that the previous day high (not shown in this chart) around 1.32531, was not affected. EFFORT WITH NO RESULT Something is changing...
This interval closes UP and the volume is increasing. The next interval is UP as well. This would not be Effort with no result as the next bar is up.

Quoting Scipio
...6 - For me this was the key bar (and I was wrong): a wide spread down candle that engulfs the boy of 2 previous candle, at this point for me the market is very weak.

Hence, I was looking for a narrow spread up candle showing ND to short te market.
In VSA this interval is almost never going to be "key". Volume is activity. Specifically, it is the activity of the Smart Money. Here we have a wide range interval but this wide range is happening on decreasing volume, or decreasing activity by the Smart Money. There is not much real selling pressure if the Smart Money is becoming less active.

The next interval is the tell. It is a narrow range down interval on volume less than the previous two intevals. This is No Supply.

Quoting Scipio
...7 - The market tests, the volume is less than the two previous bars but well over the average, for me it is too high to be a healthy test. However the market moves up: test confirmed.
Again, it looks like the interval prior to this one is No Supply. The volume on this interval is increasing. If you saw that the previous interval was no supply, this interval would bring you into the market.

Quoting Scipio
...8 - Another KRB it makes a HH in regard of the previous candle, it opens higher then the previous candle open and closes slightly off its low.
9 - No follow through, the market tests again, but again I dont like the volume despite it is less than the previous two candles.
Same situation here. The interval prior to 9 is No Supply. 9 has increasing volume. Nevertheless, 9 is a great place to look for an entry. It's a Test in a Rising Market albeit on increasing volume.
Without VSA, you're playing checkers while the Smart Money plays chess.
  • #23,544
  • Dec 29, 2012 3:23pm Dec 29, 2012 3:23pm
Okay, we had some fun the last time we did this so let's try it again.

This time, each answer has two parts. The first part is the name. The second part is the "justification".

For example, if you see bar 1 as a Squat. The second part of your answer would explain what you consider a Squat to be. " This is a down bar on increasing volume, especially volume greater than average. The range is less than the previous interval. The close is in the middle or upper portion of the range. The interval makes a lower low. As an added bonus, the low is in fact lower than the low of the previous two intervals.".

A. Squat B. Demand Swamping Supply (DSS) C. Basic Test D. No Demand E. Climatic Action F. Supply Swamping Demand (SSD)
G. Up Thrust H. Outside Key Reversal (OKR) I. Supply Coming in J. Shake Out K. Potential Selling Climax L. 2 bar reversal
M. No Selling Pressure N. Key Reversal Bar (KRB) O. Test P. Buying Climax
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Without VSA, you're playing checkers while the Smart Money plays chess.
  • #23,545
  • Dec 29, 2012 4:47pm Dec 29, 2012 4:47pm
Quoting HiddenGap
Okay, we had some fun the last time we did this so let's try it again.

This time, each answer has two parts. The first part is the name. The second part is the "justification".

For example, if you see bar 1 as a Squat. The second part of your answer would explain what you consider a Squat to be. " This is a down bar on increasing volume, especially volume greater than average. The range is less than the previous interval. The close is in the middle or upper portion of the range. The interval makes a lower low. As an added bonus, the...
HG you sneaky bastard 16 bar labels and only 9 marked on your chart... well, well, well aren't we raising the test bar up quite high. Is this this end of year exam?
Today's zone = Tomorrow's opportunity!
  • #23,546
  • Edited 5:21am Dec 30, 2012 12:50am | Edited 5:21am
Quoting HiddenGap
Okay, we had some fun the last time we did this so let's try it again.

This time, each answer has two parts. The first part is the name. The second part is the "justification".
OK I'll try...

1 - E - Climatic Action: I see a wide spread down bar on ultra high volume closing off the lows, the nex bar is narrow and up. Some demand hits the market. I also see that the first bar closes under a pink horizzontal line. I don't know what TCL means, but this bar is a sort of a "Pushing through support". Next bar is up, on narrow range and decreasing volume. I can't see but I bet that to the left there was at this level an old swing point. The SM are absorbing the herd bying (LOL is it possible?).

2 - K - Selling Climax: Another wide spread down bar on ultra high volume closing off the lows, again some demand is hitting the market, the next bar is down, but it is an inside bar that confirms that. The SM are swithching their positions.

3 - I - Supply Coming In: High volume UP bar on increasing volume that makes new highs, but you have to look at the close. It is well off the lows. Why some some supply is entering the market? Who at this point is selling? Sorry I don't really know...

The market, 4 bars later, reaches new lows whit a wide spread down bar on increasing volume, but look at the volume: it is high but much less than the bar 2. The next bar is up, also here some demand is entering.
Now we are looking for an invesion. The market moves sideway, than:

4 - C - Test: I really don't know the difference between a test and a basic test, but this bar is a test despite its volume is not less than the previous two, it is low (under average). The SM are looking for sellers. No floating supply left in the market as the next bars are up: test confirmed.

The market is strong.

5 - H+B+J - LOL: This is an outside bar on wide spread and increasing volume that closes near the high. It makes a new LL compared to the previous 5 bars and a HH compared to che previous (OKR). I think this is a move to catch stops (Shake Out) and buy more (DSS). I can't see because you are using bars, but i bet that this bar engulfs the previous.

6 - P+A - Buying Climax - A wide spread up bar un climatic volume that closes in the middle of its range, with next bar down I think that SM are taking some profit here as the next bar is a no selling pressure. So the SM are still bullish

7 - M - No Selling Pressure - A narrow spread inside down bar on volume less than the previous two. The SM took some profit an the previous bar, but they are still bullish. I don't like the volume since it is well over average. However a good place to enter the market since the next bar is up confirming the NSP.

The market is moving up, but the volume is decreasing when new highs are reached.

8 - G+N+F+A - Up Thrust - A narrow spread down bar on increasing volume (squat). This is at the moment, the market top, the best place to see an UT. Some serius supply is entering the market...is this supply enough to reverse the market? I don't konw...but some serius signs of weakness are appearing. At tnis point I would like to see a test, and I would like to see how the market react to this test. The next bar is narrow and UP on low vol. I cant see if it makes a LL, if not it is ND showing further weakness.

The market confirms weakness because the up bars have low volume, the down bars high.

9 - L - I like this 2 Bars Reversal, I think this means strength. The close is the key: the close is higher than the high of the four previous four bars. I also think that the up bar engulfs five previous bars (I HATE BARS!) However no HH is reached (in regard of the previus swing point (bar8)), the close is off the high, the close happens on the pink line (that I repeat I don't know what means) and the next bar is down. I am doubtfoul...

(9+2) - Thugh is a down bar, I like the down bar after the 2 bars reversal, it is showing strength. It is a narrow spread down inside bar on very high volume. Something here is going on (demand is swamping supply)...

The last bar is an horrible ND (for those that are unable to read a chart). Since it makes a LL and closes up I like to call this kind of bars "hidden no selling pressure". this is not a hidden test because it closes in the middle of its range.

The backgrownd is confused for me because I am not able to read a chart...but the bar 9, (9+2) and the last bar if confirmed, are showing strength...

THE TREND IS STILL UP


***EDIT*** I edited this post before someone else had posted, to correct my very poor english. Sorry.
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  • #23,547
  • Dec 30, 2012 1:22am Dec 30, 2012 1:22am
Quoting HiddenGap
E. Climatic Action

Hi HG, simple question for you...what is the basic definition for Climatic Action? and what distinguishes a climatic action from a buying/selling climax?

Thank you
  • #23,548
  • Dec 30, 2012 5:17am Dec 30, 2012 5:17am
There is a real (free) VWAP available for MT4.
Google VWAP_v1.mq4
and learn to use it.
  • #23,549
  • Dec 30, 2012 10:13am Dec 30, 2012 10:13am
Quoting HiddenGap
Looking at your chart, we are moving up on decreasing volume. This is bearish. Soon we need to see either volume increase on these up bars or we need to see a Test.

If we get an up bar where the range is narrow and the volume remains low, this will be our No Demand. And price will probably attempt to head back down to the low of your Zone.

These were more questions than statements. Do you agree?
Wouldn't some of these low volume bars be considered ND or NS. I see some indications, where there is lower volume than the previous two bars with narrow spread candles.
  • #23,550
  • Edited 11:39am Dec 30, 2012 10:48am | Edited 11:39am
Quoting HiddenGap
Okay, we had some fun the last time we did this so let's try it again.

This time, each answer has two parts. The first part is the name. The second part is the "justification".
Sorry HG, my chart says something different...

7 - Test on high volume, next bar down: Failed test/No result form a test
8 - Potential ND, unconfirmed
9 - Up squat, Supply swamping demand
10 - Demand enters the market
11 - No selling pressure
12 - ND in form of UT
13 - No selling pressure
14 - Supply enters the market, it is the last attempt by the bulls to regain control of the market, it fails and supply is swamping demand
15 - KRB/ Hidden UT, more supply is entering the market
16 - Hidden UT, more supply is entering the market
17 - Test on high volume - failed test
18 - ND
19 - This bar closes on the lows and closes under the previous 8 bars close

This is distribution...your chart is showing some strength...mine at all...
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  • #23,551
  • Dec 30, 2012 11:33am Dec 30, 2012 11:33am
Ok, guys, I have been reading this interesting thread. Thanks to Malcom and all other participants.
I have been studying different aspects of volumen issue.
After all, I bring some quiestions to this thread:

1) FOREX is an OTC market. There are dark pools, HTF sistems, etc. Therefore, volume is not reliable (imho).

2) FOREX volume is TICK VOLUME. It means that 1 tick = 1 transaction. So in FOREX MARKET, 1 tick of 1 million dollars means the same than 1 tick of 1000 dollars.
And that is a dangerous approaching to tape reading.

3) I have discovered some brokers, like Dukascopy, who represents BID chart and you have the option to read ASK chart.
It is interesting. BID volume (corresponding to BID chart) is frequently DIFFERENT to ASK volume (corresponding to ASK chart). Obviously it is, because there are BID ticks and separately, ASK ticks, as we can see if we take a look to a LEVEL II (price ladder) and watch real time transactions.

4) I have compared Dukascopy BID chart (as an example), with different MT4 and other platform charts, discovering that price chart we can see is really BID price, AND volume we can see is really BID volume (depending each broker data). Volume reading variations are notorious, if you compare different broker data, but important point is:

YOU CAN READ BID VOLUME. NOT ASK VOLUME AT ALL.

VSA is an ingenious way to approach market activity based on volume and price. But I suspect volume reading is quite manipulated in the chart.

So I have an idea, but probably I am not the first one:
My idea consist in comparing BID volume and ASK volume.
e.g., let us consider a M15 breakout bar. High spread bar, closing off the highs, high volume.
classical reading: BID volume e.g. 1500.
Now let me introduce you ASK volume at this point: ASK vol = 1200.
If we calculate bid/ask = 1.25. In other words, ASK VOL was 25% LESS than BID VOL in last M15 brakeout bar.
If we assume that ASK VOL IS POTENTIALLY BUYER and BID VOL IS POTENTIALLY SELLER, therefore we have a potentialy seller BAR.
In other words, we have a potentialy false brakeout.

If this is right, next step would be making an indicator that calculates bid/ask proportion, representated on bars upon a central cero edge, and use this information to compare it with VSA "clasic pattern" information, as a confirmation. I think it would help.

I would like to see your opinions. Thanks.
  • #23,552
  • Dec 30, 2012 12:24pm Dec 30, 2012 12:24pm
Quoting javieritvs
Ok, guys, I have been reading this interesting thread. Thanks to Malcom and all other participants.
I have been studying different aspects of volumen issue.
After all, I bring some quiestions to this thread:

1) FOREX is an OTC market. There are dark pools, HTF sistems, etc. Therefore, volume is not reliable (imho).

2) FOREX volume is TICK VOLUME. It means that 1 tick = 1 transaction. So in FOREX MARKET, 1 tick of 1 million dollars means the same than 1 tick of 1000 dollars.
And that is a dangerous approaching to tape reading.

3) I have discovered...
It's probably not a good idea to tell us all that everything we do is wrong because 'volume cannot work with the Forex', and then turn around and ask us for our help!!
..........and all with your first ever post!

BTW, in your example, Ask is 20% less than Bid, not 25%.
  • #23,553
  • Dec 30, 2012 12:32pm Dec 30, 2012 12:32pm
Quoting Scipio
Hi HG, simple question for you...what is the basic definition for Climatic Action? and what distinguishes a climatic action from a buying/selling climax?

Thank you
Background and position distinguish the 2.
All Buying /Selling Climaxs' are a type of Climactic action but, not all Climactic action bars are a Buying/Selling Climax. MTM should explain this for you.

BTW with your last post, have you missed the point of HGs question/post? He's looking for an answer to his post, not an example of your own.
  • #23,554
  • Dec 30, 2012 12:40pm Dec 30, 2012 12:40pm
Quoting Intel
Background and position distinguish the 2.
All Buying /Selling Climaxs' are a type of Climactic action but, not all Climactic action bars are a Buying/Selling Climax. MTM should explain this for you.

BTW with your last post, have you missed the point of HGs question/post? He's looking for an answer to his post, not an example of your own.
I had given an answer on post#23547...In post#23551 I only stated that I read something different in my chart.
  • #23,555
  • Dec 30, 2012 12:50pm Dec 30, 2012 12:50pm
Quoting Scipio
I had given an answer on post#23547...In post#23551 I only stated that I read something different in my chart.
Hey I see, you had answered in a previous post. This post was just for comparison.
  • #23,556
  • Dec 30, 2012 12:55pm Dec 30, 2012 12:55pm
Quoting Intel
Hey I see, you had answered in a previous post. This post was just for comparison.
NP
  • #23,557
  • Dec 30, 2012 1:23pm Dec 30, 2012 1:23pm
Quoting HiddenGap
Okay, we had some fun the last time we did this so let's try it again.

This time, each answer has two parts. The first part is the name. The second part is the "justification".

For example, if you see bar 1 as a Squat. The second part of your answer would explain what you consider a Squat to be. " This is a down bar on increasing volume, especially volume greater than average. The range is less than the previous interval. The close is in the middle or upper portion of the range. The interval makes a lower low. As an added bonus, the...
Hi HG,

This is my first post here. I have been snooping here for sometime. Let me give a try.
I feel you guys are doing a nice job.

1 - K. Potential Selling Climax. This is a down bar on high volume. Volume indicates the transfer of positions. All the weak holders(who bought at higher prices are locked in) are selling their positon here because of fear of loosing more.This helps SM to buy here without putting the prices up against their buying. Next bar is up confirms that there was lot of buying happend in bar 1.

2 - E. Climatic Action. Down-bar with ultra high volume. Next 5 bars proves that there has been lot of buying happend in 2.

3 - F. Supply Swamping Demand. An up bar with more volume that previous bar. Supply is comming and suppressing the demand.

4 - C. Basic Test. Price is marked down to see the activity. Test was successful because of the less activity(volume) comparitively. This shows SM has already absorbed most of the supply in the market and is ready to move up.

5 - J. Shake Out. This is a suden move to catch the stops of those who are on long side. This is usually done before the real move happens. Next two bars comfirms this. Also we have strength in the background. Since the volume is not that high we can call this as a Reverse Upthrust also.

6 - P. Buying Climax. Price made new high but came back to close in the middle. Probaly SM started unloading their long positions.

7 - M. No Selling Pressure. Down bar with low spread and low volume. This shows smart money is not intersted in down side.

8 - G. Upthrust. High volume bar making higher high but closing at its low. SM is unloading their long postions further.

Waiting for your results.

Thanks,
LO-Trader
  • #23,558
  • Dec 30, 2012 1:55pm Dec 30, 2012 1:55pm
Does Mal read or visit this thread
Or he stopped
  • #23,559
  • Dec 30, 2012 2:31pm Dec 30, 2012 2:31pm
Quoting egkid
Does Mal read or visit this thread
Or he stopped
Hey eg.

He hasn't been around for quite some time now.
  • #23,560
  • Dec 30, 2012 3:27pm Dec 30, 2012 3:27pm
Quoting HiddenGap
Okay, we had some fun the last time we did this so let's try it again.

This time, each answer has two parts. The first part is the name. The second part is the "justification".

For example, if you see bar 1 as a Squat. The second part of your answer would explain what you consider a Squat to be. " This is a down bar on increasing volume, especially volume greater than average. The range is less than the previous interval. The close is in the middle or upper portion of the range. The interval makes a lower low. As an added bonus, the...
Bar 1. F. DSS - can't call this a selling climax since it was part of an already present bear market sell off. Too high up. This bar could also be seen as an effort to fall (per MTM) (this should have been on your list HG) as we took out support on this bar. We pushed down through the 3230 support (important level from previous days) and this was also the low of the Asian session and HG's TCL (pink line). We didn't close on the low but the demand on the next bar was taken over by supply

Bar 1a. A. Squat - huge volume no real result, lots of effort to rise right back into 3230 now resistance

Bar 2. K. Potential Selling Climax (also could be E. Climatic Action based on volume) - this is the first real support seen in this drop, now we need to see if the SM are really buying or just supporting the fall. This could be the start of distribution.

Bar 3. B. SSD - huge volume no result, made a higher high but the close is basically the same as the previous 2 bars, then we see 2 ND's before further drop

Bar 3a. Four bars after bar #3 is what could be called a true selling climax as we have seen a sustantial fall and a series of wide spread downbars on very high volume. This bar is the first time however that the next bar was an upbar. For those that want the selling climax to close off the low (not noted as a requirement in MTM) then we could also call this bar stopping volume.

Bar 4. A. Call this one a squat based on spread and volume or could be looked at as a higher volume test

Bar 5. J. Shake Out - this is everything we want a SO to be... Page 168 if you want to read the full definition. We all know the panic this bar created. Those already long most likely got stopped or had to cover, those that saw that bar take off down after three previous downbars and jumped on the moving train and shorted the market would have been very upset when that bar ended up closing on the highs... most of them would have been stopped out on this very bar or the next one. (This also technically speaking completes one hell of a L. 2 bar reversal )

Bar 5a. Not on the list but this is a nice example of effort to rise as we close on the high above the resistance formed by the high of bar #2, the volume was high but not climatic.

Bar 6. P. Buying Climax (should call it potential) - there was some obvious supply that came in on that bar otherwise we would have closed much higher. The high of this bar hits to the pip on the low of bar #1 so supply should be expected. Is the next bar down? The volume on this bar is extremely high.

Bar 7. C. Basic Test - the volume is high by comparison but it is lower than the previous 2 bars and we close on the highs with the next bar up, test passed.

Bar 8 . G. Up Thrust - Looks like an UT to me

Bar 9. This one is also F. DSS we know this was the case after the next bar which again failed at 3230...
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