VSA : Crock or Not?

[forsearch]

	Quote:	idaxtrader
	. If you want to read book that deals almost exclusively with that concept read Brett Steenbargers Enhancing Trader Performance and maybe you will finally get it.

Or better yet, watch this 2.5 hour review of it, while you still can.

http://www.traderslaboratory.com/for...html#post34020

-fs

[Eiger]

	Quote:	forsearch
	Is VSA distinct from MP or part of it? -fs

VSA comes out of the work done by Richard Wyckoff. Wyckoff was an early US trader. He started on Wall Street around the turn of the (last) century, had a brokerage business, and eventually had a newsletter and wrote a course. He was close to the major traders of his day like Jesse Livermore and EH Harriman, and studied their methods along with the big money pools and their operators. Wyckoff learned that he could read the tracks left by the bigger operators in the volume and price action on the charts. He wrote a course about this and other materials and created an organization called Wyckoff Associates to contiune his work and to educate traders on his methods (he died in the 1930s). Wyckoff Associates later became the Wyckoff/Stock Market Institute. SMI expanded the course over the years and continues to publish Wyckoff-based work to this day. Tom Williams traded for a big money syndicate (similar to the now outlawed pools of the pre 1930s) and used Wyckoff's methodology in his trading. Williams retired from syndicate trading and wrote a book called the Undeclared Secrets that Drive the Stock Market . In the book, he places great emphasis on the reading of volume as the reading of professional activity in the market, and that is it the professionals (i.e., big money operators, not the 1 & 2 lot traders) that move the markets. Williams also developed a charting package called Wyckoff/VSA by Genii Software to help identify and highlight trading principles as they occured on the chart. This later became TradeGuider.

Market Profile is separate from VSA. Also, as Rick mentioned above, VSA looks only at the HLC, so candelsticks are irrelevant to VSA.

Eiger

[lote_tree]

I just want to add to what smwinc said before.

VSA, MP, Moving averages, RSI, Candlestick patterns ect ect to me are like different types of martial arts. Each one having its own unique philosophy on how to attack and defend.

Who’s the better fighter, Bruce Lee or Jet Li? Both practiced different forms of martial arts but both of them could be considered great martial artists. What does this tell you? Well it tells me that it’s the practitioners’ ability to use the tools available to him/her that will determine his/her success. The martial art isn’t the most important thing, what matters is have you put in the time and the effort to perfect your technique?

The point is that people like Bruce or Jet could have studied any martial art and they still would have ended up as martial arts legends. By the same token had Paul Tudor Jones dveoted his life to candlestick pattern analysis he would have stilll ended up as one of the best fund managers of all time.

This thread reminds me of an interview with the greatest chess player of all time, Gary Kasparov. The interviewer asked him, “Which is your favourite piece”?

Garry replied: “I don’t have a favourite piece, I believe in all the pieces, from the pawn all the way up to the king”.

I think this is what separates the pro’s from the amateurs. IMHO I think having a discussion about whether VSA works or not is a waste of time.

I’m sorry to sound blunt but I think discussions like these will not help anyone. Just because somebody can’t get a particular method to work doesn’t mean it’s crock. All it’s telling you is that this particular trading methodology doesn’t suit you as an individual.

Peace…

[Eiger]

	Quote:	lote_tree
	I just want to add to what smwinc said before. VSA, MP, Moving averages, RSI, Candlestick patterns ect ect to me are like different types of martial arts. Each one having its own unique philosophy on how to attack and defend. Who’s the better fighter, Bruce Lee or Jet Li? Both practiced different forms of martial arts but both of them could be considered great martial artists. What does this tell you? Well it tells me that it’s the practitioners’ ability to use the tools available to him/her that will determine his/her success. The martial art isn’t the most important thing, what matters is have you put in the time and the effort to perfect your technique? The point is that people like Bruce or Jet could have studied any martial art and they still would have ended up as martial arts legends. This thread reminds me of an interview with the greatest chess player of all time, Gary Kasparov. The interviewer asked him, “Which is your favourite piece”? Garry replied: “I don’t have a favourite piece, I believe in all the pieces, from the pawn all the way up to the king”. I think this is what separates the pro’s from the amateurs. IMHO I think having a discussion about whether VSA works or not is a waste of time. I’m sorry to sound blunt but I think discussions like these will not help anyone. Just because somebody can’t get a particular method to work doesn’t mean it’s crock. All it’s telling you is that this particular trading methodology doesn’t suit you as an individual. Peace…

A lot of good insight in this post, I think. I like the analogy to the martial arts and the thought that whatever was studied, they would have become great martial artists (it's less the method, more the person). It's the same as saying that Tiger Woods would have been a great tennis player, had he been handed a racquett rather than a club when a kid.

The main reason for this thread was that these debates and discussions were taking over the VSA threads and that was discouraging discussions on the practice of VSA as a method from happening. I guess you might say people were debating over which piece was most important, rather than playing the chess match

I think you have a good point: there is no one best method of trading, but there is a best method for you. This point (and several others) was made in the Market Wizards and New Market Wizards books. Nearly everyone traded the markets in different ways, and were quite successful.

Eiger

[james_gsx]

	Quote:	BlowFish
	Problem with candles is they actually put the emphasis on the pattern. The smart guys soon realise (took me a whole bunch of time so maybe I am not as smart as I think I am) that this dogma can actually obscure what the price action (PA) is telling you. Incidentally, I am pretty sure Nisson is not a trader. His business model is similar to Tradeguiders though his focus is more on advisories and seminars.

3 parts to this.

1 - newbie traders (read my old posts and threads to see proof of this) put too much emphasis into the actual pattern. This is very true, and why a lot of people fail with it. Just as I'm sure there is a very similar reason why people fail using MP or VSA.

2 - While the actual "pattern" is not all that important (try to bear with me as this is difficult to explain) but the pattern in correlation to previous price action (such as trend, support and resistance, moving averages) is important. You aren't hunting for hammers or spinning tops, but looking where supply and demand come into play. Just like SMW stated in a previous post.

3 - I doubt Nison trades too. But I could be wrong, he does way too much advertising for my like. If you are ever interested in Candles, Nison has some great books. But from the little bit that I know about you, Gregory Morris's book Candlestick Charting Explained might be better suited if you are ever interested. He goes a lot further than to explain each pattern and what they mean.

I'm not going to say VSA does or doesn't work. Obviously it works for a good amount of people as it has lasted a long time - the same is true for candlesticks, MP, and various other trading analysis. For some VSA will come across as complete nonsense and backwards - for others it's that one thing that clicks and helps them make complete sense of the market.

An interesting study would be to see the different types of personalities that use various techniques.

I am glad there are VSA vs Candlestick posts on this forum as it adds validity to both methods. It's when the immaturity steps into play when it becomes nonsense and I am as much apart of this as most.

Time to go watch hockey.

p.s - The Red Wings suck.

[forsearch]

	Quote:	james_gsx
	I doubt Nison trades too. But I could be wrong, he does way too much advertising for my like. If you are ever interested in Candles, Nison has some great books.

So what does Nison have to do with VSA, if anything at all?

[james_gsx]

	Quote:	forsearch
	So what does Nison have to do with VSA, if anything at all?

Nothing. I was just responding to something Blowfish had said about Nison being a trader.

[smwinc]

	Quote:	lote_tree
	This thread reminds me of an interview with the greatest chess player of all time, Gary Kasparov. The interviewer asked him, “Which is your favourite piece”? Garry replied: “I don’t have a favourite piece, I believe in all the pieces, from the pawn all the way up to the king”.

Really nice analogy Lote_Tree - very true when you think about it.

[darthtrader]

I don't really see the point in this debate. I'm not really interested in candles or VSA actually.
To me a good analogy is between a BMW, a Mercedes and a Lexus in the same price range.
The Mercedes and Lexus may as well have no value to me because I would never buy one over a BMW. However, that hardly means that a Mercedes or Lexus are "worthless". All 3 will roughly accomplish the exact same goal, just a matter of style and personal taste.

[Sledge]

	Quote:	darthtrader
	I don't really see the point in this debate. I'm not really interested in candles or VSA actually. To me a good analogy is between a BMW, a Mercedes and a Lexus in the same price range. The Mercedes and Lexus may as well have no value to me because I would never buy one over a BMW. However, that hardly means that a Mercedes or Lexus are "worthless". All 3 will roughly accomplish the exact same goal, just a matter of style and personal taste.

I agree, and I actually question why it really only took 2 pages of bantering here for multiple people to reach this conclusion, and yet in both VSA threads it was a constant distracti