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vsa with Malcolm

  • #24,861
  • Nov 12, 2013 10:39pm Nov 12, 2013 10:39pm
Quoting mima
{quote} Post in question is from 11-5-2013...You were suggesting to go long based on selling climax on H1: "a selling climax, should be a nice run" which would as you suggested go to 0.97-0.98...which was 300-400 pips from that "selling climax" You had hidden suggestion to other traders to go long on that "a selling climax, should be a nice run" and you do not take that trade of prospective 300-400 pips. Why?...When you saw that was wrong why you did not post correction, admitted error...?
I went long on October 31st to which I was stopped out on November 8th. So on November 5 I was already long.. If that is what you are worried about.

I did not go long on the selling climax, I went long off the tests at the low of the selling climax. See the post I just pasted.

I rarely post follow ups to any of my trades, win or lose. I don't care if I win or lose a trade all I care about is the setup. I use this mechanism so I don't dwell on loses.
  • #24,862
  • Nov 13, 2013 3:44am Nov 13, 2013 3:44am
Quoting SimpleDev
{quote} I went long on October 31st to which I was stopped out on November 8th. So on November 5 I was already long.. If that is what you are worried about. I did not go long on the selling climax, I went long off the tests at the low of the selling climax. See the post I just pasted. I rarely post follow ups to any of my trades, win or lose. I don't care if I win or lose a trade all I care about is the setup. I use this mechanism so I don't dwell on loses.
Hi Simpledev,

The term Test and Testing supply is confusing me. What i konow is testing supply is when SM marks down the price, check if there are still sellers and mark up the price again and the test candle has its close on the upper half. If SM sees low volume test, they start marking up the price after one or two candle from the test candle. This usually happens at a demand level.

why don't we have, Testing demand at supply levels ? Because testing demand would be if SM wants lower prices, in my opinion they should chech if theres is still demand from the herd. This could have been done by marking the price up and down again. If it is high volume, that would mean there are still buyers. It its low volume, that would mean no buyers are left, and start marking thevprice down.

Whay don't we have testing demand in VSA?

Another question i have, what Malcolmbs is trying to say in following post;
http://www.forexfactory.com/showthread.php?t=157629&page=147

He is telling that price is testing of supply. I really don't understand what he is trying to say.
  • #24,863
  • Nov 13, 2013 4:15am Nov 13, 2013 4:15am
I am waiting for a downward move on GU:

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  • #24,864
  • Nov 13, 2013 4:55am Nov 13, 2013 4:55am
Quoting Trappist
{quote} Hi Simpledev, The term Test and Testing supply is confusing me.
Testing for demand has been debated before because Master the Markets never mentions testing for demand, it only mentions test for supply. To me if the market tests for supply it only makes sense to test for demand. Some call the test of demand a "low volume up thrust".


Quoting Trappist
{quote} Another question i have, what Malcolmbs is trying to say in following post; http://www.forexfactory.com/showthre...57629&page=147 He is telling that price is testing of supply. I really don't understand what he is trying to say.
Malcolm is talking about testing for demand in this post. He says testing of the supply line, basically he meant resistance..

Attached is a chart back from August 20th 2009. He saw the high volume up bar and thought it was supply, the yellow bars he saw them as tests, or that the market had no interest to go up. I think the bars he marked off had too much volume to be tests.

After the fact, there was no weakness in the up bar, it closed on its high, and going back there on the 1h chart back on 8/7 there was massive volume that came in on a selling climax.
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Click to Enlarge Name: 1h.png Size: 115 KB
  • #24,865
  • Nov 13, 2013 4:59am Nov 13, 2013 4:59am
Quoting SimpleDev
Attached is a chart back from August 20th 2009.
If you are reading back on previous posts, its good to go find it on your charts so you can see what that person saw and what happened.

I think Oanda offers historical data for MT4. I have MT4, but only open it once every 6 months, so I am not sure exactly how to find the historical data for MT4, but I am sure google can help.

Other than that I am done for the week. I will be back next week, will be moving for the next 4 or 5 days.
  • #24,866
  • Nov 13, 2013 8:31am Nov 13, 2013 8:31am
Quoting SimpleDev
{quote} If you are reading back on previous posts, its good to go find it on your charts so you can see what that person saw and what happened. I think Oanda offers historical data for MT4. I have MT4, but only open it once every 6 months, so I am not sure exactly how to find the historical data for MT4, but I am sure google can help. Other than that I am done for the week. I will be back next week, will be moving for the next 4 or 5 days.
i agree with you.

Sometimes i see some VSA traders using the term testing supply at supply levels or at resistance lines. They claim that SM is checking if there is still supply available before they push through supply to keep continue mark up the prices. If there is high volume on test candle and next two candles do not close above its high, then they call it failed test.

I am used to see such tests after selling climaxes and stopping volumes before a mark up begins. In Mtm such tests are shown only at demand and support levels. But in reality such tests before mark up can appear at suppley and resistance levels also. Is it right ?
  • #24,867
  • Nov 13, 2013 1:08pm Nov 13, 2013 1:08pm
"Testing" confuses me, too.

1. In an area of strength, a test is supposed to be represented by an up bar that thrusted into lows, before being pushed up (the same as a shake-out). If the volume is low, then the test is supposed to have been successful and we should expect higher prices. If volume was high, then not.

Oh, while writing this, I realized now why low volume is better than high volume at a test. In both cases, there is practically unlimited smart money that wants to buy at low prices (by definition, smart money is only limited by the capacity of the market and tries to avoid moving the price to much). Therefore, the volume seen is the total amount available for selling at that time.

Now I also understand, why, after a no-supply bar, we should enter only after the bars high has been reached again: Because this ensures that supply was larger than demand. So, a no-supply bar plus reversal is similar to a test bar, spread over several bars.

So, a shake-out by itself (with high volume) is not sufficient to enter long. A confirmation by a low volume test or no-demand bar is better.

2. Imagine, we would quote all the pairs the other way around, like USDEUR instead of EURUSD, then it becomes clear that tests also apply the other way around after signs of weakness. (In the original developed VSA this was not possible, as it was developed on stocks, which can not be shorted so easily).
  • #24,868
  • Nov 14, 2013 4:21am Nov 14, 2013 4:21am
Entered long on GU:
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  • #24,869
  • Nov 14, 2013 1:44pm Nov 14, 2013 1:44pm
Quoting Curtis_S
Entered long on GU: {image}

Hello Curtis,
interesting chart. Could you expand a little bit on the reason why you entered long?
Is it because of the successful test?
Is the text on your chart something you write by hand or an indicator?
I guess "s" on a upper pin means supply, but what means "b" at the lower pin?
I know SOS or SOW but what means SO?
Thanks
Srx
  • #24,870
  • Nov 14, 2013 5:45pm Nov 14, 2013 5:45pm
Quoting schmurex
{quote} Hello Curtis, interesting chart. Could you expand a little bit on the reason why you entered long? Is it because of the successful test? Is the text on your chart something you write by hand or an indicator? I guess "s" on a upper pin means supply, but what means "b" at the lower pin? I know SOS or SOW but what means SO? Thanks Srx
I entered the long in accordance with the trading strategy of Intel (I believe it is explained on page 410): I entred because of this sequence: After signs of weakness, like buying (b), then a shake-out (so) (in this case the so spread over 3 bars), then a confirmation of the shake-out (conf so), then a no-demand bar or a successful test (test suc).

I wrote it by hand.
  • #24,871
  • Nov 14, 2013 7:58pm Nov 14, 2013 7:58pm
Quoting Curtis_S
"Testing" confuses me, too. 1. In an area of strength, a test is supposed to be represented by an up bar that thrusted into lows, before being pushed up (the same as a shake-out). If the volume is low, then the test is supposed to have been successful and we should expect higher prices. If volume was high, then not. Oh, while writing this, I realized now why low volume is better than high volume at a test. In both cases, there is practically unlimited smart money that wants to buy at low prices (by definition, smart money is only limited by the...
A true test is a downbar, an upbar test is called a hidden test. Regardless of name or down vs. upbar was does the make up of a test represent? In the world of VSA a test bar usually will open on it's high, head down and the close in the upper 50% of the range. To be a true basic test we treat it by the same rules as a NS in that we prefer to see volume lower than the previous 2 bars. So this shows that the market headed down to test for selling interest and when we see the close well up in the range it is said to mean that no sellers were found. The lack of volume = lack of activity so while there we no sellers there was also no buying. Your comments that;

"If the volume is low, then the test is supposed to have been successful and we should expect higher prices. If volume was high, then not"

Is not true. In order for a test to be considered successful we need to see buyers and price moving upward above the high of the test and most definately closing above the high of the test bar. The low volume on the test bar has nothing to do with it being successful this simply makes it a basic test where a high volume test would be just that. Either a high volume test or a SO. Scans some charts and see how many times in a weak market we see a tempoary SOS followed by a low volume test just to end up with a market that continues downward as the test fails.

The other kicker for me and something I have said many times in this and other VSA forums is that I want to see the test bar testing something. A test floating in the air is of no use to me. I need to see them testing a broken supply zone or even into a demand zone or into a UHV trigger level.

Some say that the market is always testing and to a point I agree. The market is a balance between buyers and sellers and it is those moments of inbalance when the SM decide to move the market by filling orders and taking out week holders that we can make our money. It happens over and over again where we will see the inital signs of strength and the market goes up only to come back to the source of the strength to fill more of their buy orders by sucking in unsuspecting weak shorts whom are going to be lead to the slaughter.

This is where tests come in handy... we see the UHV=activity and rather than jumping in blindly we wait for the test bar in the right place to show the tides have turned.

Thinking about tests really shows the herd side of the market. The SM are testing lower prices for sellers... who wants to sell at lower prices? Not me. I sell at prices higher that they are now and buy at prices lower than the are now. This is what SM does so why should we do any different.

For what it's worth the post was based on the test at SOS but I do the same things for SOW. I do trade upside down tests (some call it low volume UT). For every buyer there is a seller. SM needs opposing orders to fill theirs and as such whether they are sellers or buyers they need to lure the other side in. They fill some orders and the market moves. We retrace back and they fill some more orders and the market moves even stronger in the direct the SM wants. As the herd SL's get hit and the opposing orders are closed the SM orders gain strength, we get imbalance and boom! Money is made.
Today's zone = Tomorrow's opportunity!
  • #24,872
  • Nov 14, 2013 10:18pm Nov 14, 2013 10:18pm
Quoting pres78
{quote} A true test is a downbar, an upbar test is called a hidden test. Regardless of name or down vs. upbar was does the make up of a test represent? In the world of VSA a test bar usually will open on it's high, head down and the close in the upper 50% of the range. To be a true basic test we treat it by the same rules as a NS in that we prefer to see volume lower than the previous 2 bars. So this shows that the market headed down to test for selling interest and when we see the close well up in the range it is said to mean that no sellers were...

nice post.....please keep them coming......
  • #24,873
  • Nov 15, 2013 1:05am Nov 15, 2013 1:05am
Quoting Curtis_S
{quote} I entered the long in accordance with the trading strategy of Intel (I believe it is explained on page 410): I entred because of this sequence: After signs of weakness, like buying (b), then a shake-out (so) (in this case the so spread over 3 bars), then a confirmation of the shake-out (conf so), then a no-demand bar or a successful test (test suc). I wrote it by hand.

Thanks Curtis,
I had a look at page 410 and started to read and going backward from quote to quote for a few hours. Very interesting read.
I didn't find the post you were referring to, though. If you happen to find it please share the link.

@Pres 78 Thanks for the detailed explanation.

Can anyone recommand a document with a concise definition of the different kind of bars in VSA, preferably with some illustrations? I have collected a lot of documents in this thread and others about VSA but nothing really satisfactory.
  • #24,874
  • Nov 15, 2013 2:18am Nov 15, 2013 2:18am
Quoting schmurex
{quote} Thanks Curtis, I had a look at page 410 and started to read and going backward from quote to quote for a few hours. Very interesting read. I didn't find the post you were referring to, though. If you happen to find it please share the link. @Pres 78 Thanks for the detailed explanation. Can anyone recommand a document with a concise definition of the different kind of bars in VSA, preferably with some illustrations? I have collected a lot of documents in this thread and others about VSA but nothing really satisfactory.
Here is the trading strategy of Intel:

http://www.forexfactory.com/showthre...42#post4024442
  • #24,875
  • Nov 15, 2013 2:21am Nov 15, 2013 2:21am
Quoting Curtis_S
{quote} Here is the trading strategy of Intel: http://www.forexfactory.com/showthre...42#post4024442

Thanks a lot Curtis
Srx
  • #24,876
  • Nov 15, 2013 9:51am Nov 15, 2013 9:51am
I hope this is a valid setup:
(nbp = no buying pressure, s = selling, b = buying)

Attached Image
  • #24,877
  • Nov 15, 2013 1:57pm Nov 15, 2013 1:57pm
Quoting Curtis_S
I hope this is a valid setup: (nbp = no buying pressure, s = selling, b = buying) {image}

Hello Curtis,
what pair is it? so I can look to it on my own charts...
  • #24,878
  • Nov 15, 2013 2:04pm Nov 15, 2013 2:04pm
Quoting schmurex
{quote} Hello Curtis, what pair is it? so I can look to it on my own charts...

Ok, I see, it's EU.
the Bearish wedge (?) we see starting on your chart is still on. It might break to the down side...
Srx
  • #24,879
  • Nov 15, 2013 3:41pm Nov 15, 2013 3:41pm
Quoting pres78
{quote} A true test is a downbar, an upbar test is called a hidden test. Regardless of name or down vs. upbar was does the make up of a test represent? In the world of VSA a test bar usually will open on it's high, head down and the close in the upper 50% of the range. To be a true basic test we treat it by the same rules as a NS in that we prefer to see volume lower than the previous 2 bars. So this shows that the market headed down to test for selling interest and when we see the close well up in the range it is said to mean that no sellers were...
what time frame do you trade..........
  • #24,880
  • Nov 15, 2013 8:33pm Nov 15, 2013 8:33pm
I need some help to understand correctly :
"SOW 5: The bar should be a narrow spread up bar with high volume and closing off the highs"
I understand closing at the high (or does that mean closing anywhere but the high?).
Please answer only if English is your first language.
Thanks
Srx
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