[VSA] Volume Spread Analysis

[Tasuki]

	Quote:	Sledge
	Is it possible to spot the "anvil" as I call it. Sledge

Hello Percy,
Well, it is possible. Just look at today's trading action on the ES (or probably any of the index futures contracts). In short, what you would look for is:
1) "upthrust"
thrusts up past resistance but closes near low
medium range bar
medium volume (just enough to make the breakout suckers think we're gonna rip)
closes near low of bar
2) "no demand"
narrow range bar
volume lower than the previous 2 bars

See attached chart. This is a clear an example as I can think of for your "anvil" trade.
cheers,
Taz

[BlowFish]

Great chart Tasuki,

I think point 3 is pretty key. Pure Whycoff. I place as much importance on rising falling volume over a handful of bars as within the individual ones. Strictly speaking no demand should appear on an up bar (point 2) but I'd go with you on that, the bulls look spent. Lots of places to hop on too! Doesn't get much better.

Cheers.

[bertg]

	Quote:	Tasuki
	See attached chart. cheers, Taz

Taz,

First, thanks for the volume indicator tip several posts ago. I will be watching it. SierraChart has Bid Volume and Ask volume that I overlaid on the same graph.

Now, on the chart above, what chart trading hours are you using? I ask that because it's important to how the 34 EMA is plotted. Is it 9:30ET - 4:15ET

On #2, isn't a down bar with volume less than the last two bars a no supply bar?

Thank you,
Bert

[Tasuki]

	Quote:	bertg
	Taz, First, thanks for the volume indicator tip several posts ago. I will be watching it. SierraChart has Bid Volume and Ask volume that I overlaid on the same graph. Now, on the chart above, what chart trading hours are you using? I ask that because it's important to how the 34 EMA is plotted. Is it 9:30ET - 4:15ET On #2, isn't a down bar with volume less than the last two bars a no supply bar? Thank you, Bert

Berg and Blow,
First, you're most welcome. In private messages I've gotten several positive comments. Someone even said I should call it my "world famous" indicator. In the public forum, however, I've mostly gotten criticism or dismissal . Glad to hear you'll give it a try.
Regarding the hours, yes, normal session hours. Don't tell anyone but I've found that there are a few moving averages that work (VSA purists would be rolling over in their graves if they weren't still alive!), and the 34 EMA on the 5' chart is one of them. If price marches up to it in that lockstep fashion that it did today, and all the while volume is dropping off, and you also get upthrusts and no demand bars, then there is more chance of snow in hell than an upside breakout through that 34 EMA.
Regarding "no demand" vs "no supply", all I can say is, "Location, location, location". The same type bar with the same type volume pattern could be no supply if it's found during a consolidation at the lows of a market, or no demand if it's found during the consolidation at the top of a market. Capiche?
Taz

[bertg]

Taz,

Capiche! Thanks for the analysis.

BF,

When I clicked reply to Taz's post, his was the last. But it took me ages to correct my typing, because my laptop keyboard skips a bunch of letters. So, had I seen your post, I obviously wouldn't have posted about the no supply bar.

Andspeaking of Wyckoff, I ordered his "Studies in tape reading" and am looking forwrd to reading it.

Regards,
Bert

[RAVIN]

	Quote:	Tasuki
	Berg and Blow, First, you're most welcome. In private messages I've gotten several positive comments. Someone even said I should call it my "world famous" indicator. In the public forum, however, I've mostly gotten criticism or dismissal . Glad to hear you'll give it a try. Regarding the hours, yes, normal session hours. Don't tell anyone but I've found that there are a few moving averages that work (VSA purists would be rolling over in their graves if they weren't still alive!), and the 34 EMA on the 5' chart is one of them. If price marches up to it in that lockstep fashion that it did today, and all the while volume is dropping off, and you also get upthrusts and no demand bars, then there is more chance of snow in hell than an upside breakout through that 34 EMA. Regarding "no demand" vs "no supply", all I can say is, "Location, location, location". The same type bar with the same type volume pattern could be no supply if it's found during a consolidation at the lows of a market, or no demand if it's found during the consolidation at the top of a market. Capiche? Taz

Taz, Your contributions are as valuable as the next person, nobody can dictate to you as long as we keep to the core topic of this thread . Any enhancement on that, like the MA you mentioned or Market delta concepts should only be encouraged and not brushed aside. It is also imperative that we move into some realtime trades . When reading from the middle of the chart with the ensuing move in focus, the mind has a tendency to seek all the evidence to validate that and block other countermanding signals, but in realtime we do not have that luxury
Keep posting pal.

[Blu-Ray]

Taz

Great chart and analysis, thanks very much, please keep them coming.

Cheers

Blu-Ray

[Sledge]

Tasuki-
Incredible. Thank you so very much for the chart and the info, that helps quite a bit!
Regards,
Percy, Sledge

[RAVIN]

	Quote:	BlowFish
	Great chart Tasuki, I think point 3 is pretty key. Pure Whycoff. I place as much importance on rising falling volume over a handful of bars as within the individual ones. Strictly speaking no demand should appear on an up bar (point 2) but I'd go with you on that, the bulls look spent. Lots of places to hop on too! Doesn't get much better. Cheers.

Agreed, infact what Taz has presented actually illustrate 2 of the 6 major supply/demand principles explain in Vadym's book,
and in this respect if he has gainfully blended and employed concepts from Market Delta in his realtime trading, then I see no reason why they cannot be posted here.
On the theme of decreasing vol on rising prices, upthrust, no demand etc, there were 3 on the Dax this morning. The MA here is not 34EMA but my way of keeping track of what is happening on the 15min chart. that way I do not have to flick back and forth.

[Soultrader]

Here is a chart from today. Part of my strategy using Market Profile then narrowing it down to techniques such as VSA (in this case) for trade location.



Price rallied towards the 13520 mark. IB range extension is roughly 50% of IB range with D period tails. Possible normal day under development and predicting minimal opportunities in the afternoon session.