[VSA] Volume Spread Analysis

[notouch]

I like VSA in combination with market profile and candlestick patterns.

[walterw]

	Quote:	notouch
	I like VSA in combination with market profile and candlestick patterns.

I see... so you use candlesticks for timing..? do you look at smaller time frames for more specific timing entries ?

[notouch]

Yes, in fact multi-timeframing is an important aspect of VSA. Using the daily for direction and then the hourly, 15 minute and 5 minute charts for entry works well, especially when used with candlestick analysis.

[walterw]

	Quote:	notouch
	Yes, in fact multi-timeframing is an important aspect of VSA. Using the daily for direction and then the hourly, 15 minute and 5 minute charts for entry works well, especially when used with candlestick analysis.

What would be the best time frame for a vsa "setup"... more reliable in terms of volume concepts readings ?

[notouch]

It depends on your trading style. I'm not very interested in the smaller time frames. At the VSA tutorial that a lot of us went to a few months back the speaker used daily, hourly, 15 minute and 3 minute charts.

[Anonymous]

	Quote:	walterw
	yes correct, calling it smart money may be a little tricky, because maybe that super volume spike was the dumb and uninformed money that bought there...

1. Okay, assume the High volume is the retail trader, or dumb money. Now the real questions is this: WHO IS SELLING TO THEM?

2. You do not want to "believe" in Professional money, fine. But Does there seem to be a group that is on the correct side of a trade more often than not? When volume is high at a top or bottom, somebody was doing the selling (at the top) and the buying (at the bottom).

VSA seeks to emulate the traders that tend to be on the right side more than on the wrong one. Yet, in the book, Master the Markets, Tom Williams clearly says that some professional are wrong more than they are right. What separates them from the masses is their ability to admit they are wrong and get out of a bad position. They do not hope the market will turn in their favor. They do not curse their indicators (and most don't use any) when they are wrong, the simply reverse their positions.

3. VSA contends that 85% of a volume histogram is professional money. This is the one thing that I call the "leap of faith". Either you believe or you do not. But once you do, that means ALL volume bars are 85% professional money, even the small ones during the none regular trading hours.

4. Most traders have some idea of what the Smart Money is. One does not have to be specifically talking about trading syndicates to find value in the VSA story.

[walterw]

Shure Pivot... who cares what name we asign to the money...

Please answer me this question to this poor left brained man : The core concept of VSA could be volume divergence ? thanks Walter.

[Anonymous]

	Quote:	BlowFish
	Ive been messing round with some VSA indicators. Sometimes I think they are helpful other times I think just plain charts with volume and nothing else may be the way to go. heres a snap I just took.

Keep up the good work. Would love more of an explanation of what the dots mean. I know some can figure it out but for the newbies it would be nice.
Thanks for the chart. Please keep them coming.

[Anonymous]

	Quote:	Tasuki
	I'm sure VSA does have some merit, but there are times, it seems, when the pros are dead flat wrong. See attached chart.

.

You are soooooo wrong here.

We have Ultra High Volume on an up bar.

VSA teaches that the market does not like high volume upbars. Why? Because there could be HIDDEN selling within that bar. Note that the next bar is down. Why? Becuase there was supply dumped on the market. The Pros were selling not buying............

I do not mean to sound harsh. But it the basic premise of VSA that WEAKNESS comes in on up bars and STRENGTH comes in on down bars. Simply, if you were looking for more upside, then you, not the pros, were wrong.

P.s. Professional money is not professional money because it is never wrong........... It is professional money because it is BETTER at being wrong.

[Tasuki]

Pivotprofiler, Thanks for explaining about why the market doesn't like high volume upbars (or downbars I presume)--I never got that clear in my head before.
Technically, I can't be wrong if it's true (as you said in an earlier post) that 85% of the volume of any bar is professional money. On that bar in my chart, the high volume upbar, it would appear that 85% of the professionals were wrong, yes? If they represent most of the money, then by definition, most of them were wrong to go long as the market was about to retreat. I don't see any way around that.
BTW, be as harsh as you like. I've got a tough hide, and there's no doubt that you're the master of VSA here. I'm just here to learn, so I throw stuff out as I see it.