Sonic R. System

Try looking at the YEN House of Pairs as a separate world that is controlled more by the strength given to the YEN by the MMs. The other part of each pair provides some variations to be sure, but if there is to be major move then more likely it will be down and as the result of the MMs putting strength to the YEN.

Aaahhh yes,.....the excitement of trading against the Market Manipulators!

How do you guys read the sonic VSA volume indicator?

Pay attention to the thread. Read. You will pick it up as you go along via comments about volumes included in various posts. There have been plenty of volume comments this week alone.

Greetings All, Newbie Here..

Nice to know you all and would like to express my gratitude to SonicDeeJay for this wonderful system and Prof. Tah for its exceptional insights and comments and contributions to this thread. Thanks.

Noted below pattern forming on NZD/USD. Is it correct?

Tah, what if? :

http://content.screencast.com/users/...analayzing.png

Ok, Something About Volume:

At any time when an MM starts building a position, or decides to add to one you will see the price move up and down, or down and up. This keeps the price in a range and makes the average cost more attractive than if the MM simply kept buying in an upwards direction or selling in a downwards direction. Sometimes there can be more than two swings, and they do not all have to strike the same highs and lows. The point is that by manipulating the price up and down the MM keeps from moving the price up too high while buying, or from moving too low while selling.

Consolidation areas on charts are where you see the price has constantly moved up and down within a range, and in a concentrated fashion. The market term "consolidation" is another of those benign and palatable words that really avoids telling the truth. The truth is that when you see these areas on a chart you know there is a concentration of MMs buying or selling. If you could figure out which it was (and sometimes you can) then it makes you a less easy target for the MMs to steal money from.

You cannot tell from the up/down price gyrations put on by the MMs when they are active buying or selling, which it is. Other kinds of information must be added to the mix. Volume is unique information because it is not a technical that is a calculated derivative of price information, as all other technicals are. It is the one technical that can show you something that no other technical can show you. It can show you the price areas the MMs are doing most of their trading; at the higher prices, or at the lower prices. Is it any wonder that in the forex market the volume information given to us is prostituted down to a count of trades rather than a count of currency volumes traded? If we knew just how big some of the trades were after prices were driven to lows or to highs, then we would be even more knowledgeable about whether the MMs were bulls or bears.

Any volume chart can give enough information to reasonably figure this out, however. Even though we don't know the size of trades, if the count of trades goes up, then we know that was where the MMs wanted the price. If this is as a result of the price being driven low, then we can conclude the MMs wanted the price low because trading increased at the lows. And if that is the case, then the MMs are either closing shorts at the end of a Mark Down phase, or they are opening longs as part of an Accumulation phase. If this is as a result of the price being driven higher, then we can conclude the MMs wanted the price high because trading increased at the highs. And it that is the case, then the MMs are either closing longs at the end of a Mark Up phase, or they are opening shorts as part of a Distribuition phase. In other words, if the MMs run the price up and following that there is increased volume of trades, then the MMs are bears, not bulls. If the MMs run the price down and following that there is increased volume of trades, then the MM are bulls, not bears.

You see, bullish MMs do most of their Accumulation while price is in a range, before they break the price up out of the range. Sometimes they even drop the price down out of the range (called a head fake) to get lower prices for additional buying. Once they are loaded up long, they are ready for a Mark Up run. Bearish MMs do most of their Distribuition while price is in a range, before they break the price down out of the range. Sometimes they even raise the price up out of the range (called a head faket) to get higher prices for additional selling. Once they are loaded up short, they are ready for a Mark Down run.

The point is, by looking more closely at those events where the MMs run the price down or up, by studying the volume associated with the price bars during such an event, you can often see whether the MMs are bulls or bears. To do this you need to drop down to M1 charts and see what the volume looks like as price is manipulated up or down, then peaks and goes sideways. If the volume is more substantial overall at and after the extreme prices are achieved than before the run then you can conclude that is where the MMs wanted the price to go. And if that is where they wanted it to go then if it went up, the MMs are bears that are either closing longs or opening shorts. If it went down, then the MMs are bulls that are either closing shorts or opening longs. However, if price went up and then soon fell down again, it is more likey the rise was buying and then the MMs pulled the price down again for lower prices for more buying. If the price went down and then soon went back up again, it is more likely the drop was selling and then the MMs pulled the price back up again for higher prices for more selling. Most of PA is just a misch-mash of ups and downs and volume that is indeterminate. So you have to be diligent. You have to investigate any notable price action and move on until you come to an event that yields the information you are looking for.

Just keep this in mind about the MMs manipulating prices. There are sundry MMs, so one move can be followed by another, and another as each MM pushes prices to new highs or lows seeking better prices for their selling or buying. So, we do not trade on volume information alone! The way to use the information that studying volume gives you regarding whether MMs are bulls or bears is to wait for the next valid Sonic R. setup in that direction.

Some of this might sound tedious. It isn't, once you get the hang of it. Trading isn't easy, but price action and volume together can be very reliably predictive those times when clear clues appear; as close to the "Holy Grail" as anyone will ever come. Most forex traders shun volume, and have no idea what they are missing.

Hope This Helps,
-tah

Volume:

Ok, having read the above, what can you decipher from this M1 chart? Bull or Bear? What is the Tip-off?

The earlier H&S has already played out. Now we have another. Having an initial, smaller H&S beget a subsequent, larger H&S is not unusual. And the slightly downward sloping neckline of the current H&S is without doubt in-play. Just look at it! And do you not see that the MMs pumped the price yesterday back to the half number area and then went back to work heavily trading up there? Do you think the MMs took the price up to simply raise the price on themselves before buying more? Nope.

Figuring out if the MMs are bulls or bears sometimes is not difficult, but it is only part of the equation. Another part is the timing of the Mark Up run off of Accumulation, or the Mark Down run off of Distribution. What with the "Cypress Episode" this past weekend, I'd have thought more of the Mark Down would have been accomplished by now. But I forgot the psycology part of it all. I now figure it this way.....

The MMs figure the Mark Down run is going to be a no sweat operation for 3/4 of a thousand pips! So, they are doing what they always do out of greed in such situations; they forstall the drop to load up as much short as possible. That means suckering in longs to add liquidity for additional shorting, and hence the pullups. It might also mean that EU, as with GU yesterday, will signal the restart of the Mark Down with whopping whipsaws; the MMs wiping out as many other traders as possible at the last minute and using that liquidity to getting even more of their short orders filled. I could be wrong. Have been at other times. We'll see.

Morning all!
Nice looking Sonic R stup forming on USDCHF with volume analysis support, don't you think?

Yes! Twice recently price was hit by the MMs to get it low, below half number, for heavier trading; the adding of longs. RWH is about 60 pips beyond RDH, so I figure that to be a viable target, if not in the first move up, then with another later move before the week is over with.

And hopefully reading these Yen pairs right, because I'm loaded with shorts with all of them...

Thank you TAH for your good explanation.

Its bull?
The price was pushed down (red VSA candles) and after each significant low we see MM's are quiting shorts/entering longs (green VSA candles)

Am i right?

I think its too tricky to understand Volumes without source dates about trades from stock reports.
Fears about debt problems in Cyprus eased. So, bearish steam is out. And Weeekly reversal H&S pattern is still valid....
Anyway personally I am neutral with EU for a while.
It's gooing the dénouement

IMHO to make shorting of the Yen now is very dangerous because greenbacks moved higher against the yen on the back of news that the Federal Reserve will continue its monetary easing ignited optimism about a recovery in the U.S.

Could it just be bearish ABCD pattern on weekly chart?

Hi Tah,

Great and deep insights regarding the volume and interpretation about MM's. However, I got one doubt: the volume on your chart is only based on the volume traded from the feed (broker) that you use, which would look different from another feed (broker).

So do you mean that the volume shown by a particular feed is reliable enough to represent all the MM's out there?

ALL harmonic patterns are really tricky.
My point of view is below:
http://content.screencast.com/users/...rted%20H_S.png

Early PA waves, before London session.

GBPUSD - Long

1. Wave - ok
2. Timing - ok
3. Dragon - ok
4. Volumes (?)

Lets see...
Art.