[VSA] Volume Spread Analysis

[Wookey]

PivotProfiler,

Attached. The last three signals are considered weak, thus additional support is needed. The congestion zone at the top (between 3210-3220) when reduced to 15 min bars, looks for TradeGuider as no demand.

[Anonymous]

Thanks very much.

I place a small dot on all bars that have volume less than the previous two bars. I also place an diamond on bars with narrow ranges and increased volume.

Here is my chart of the same period. Note how the same levels are clearly indicated on the chart. In other words, those that want to program their own versions can do so. Just start to learn the method and go from there.

[Soultrader]

Hello guys,

I have a litte trouble understanding volume demand bars after a selloff. I have attached a chart from yesterdays action. The rectangle box shows couple sell volume spikes.

My questions is this: How do you watch for demand bars after that spike? In the first rectangle the volume spike is created by a doji. The next price bar closes above the high of the doji... this occurs on lower volume. How do you intrepret this? To me it seems like supply is cut off but price continues to drop.

The same thing occurs in the second rectangle box. Volume spike is created on a down bar but the next bar closes above the low of the previous bar.

Any advice would be appreciated. Thanks

[notouch]

ST, from my limited knowledge I think the key thing is that you're looking for supply to come in at key support levels (if you're buying) and resistance levels (if you're selling). 12190 was a key resistance level (S3 Pivot) and you could have got 50 points from that last trade. On a day like yesterday though you should have been looking for sell signals.

[TinGull]

Trade I took today using VSA techniques. Notice when price reached the weekly pivot that we had a wider than average spread and a LOT of volume and then price closed right near the highs of that bar. About 10 seconds before that 5min bar closed I went long at 148 and was out for a 10 point gain (my personal strategy right now...it ended up going for much more I know. baby steps here) but notice how it went on to go 50 points?! insane! This trade I think was perfect in showing VSA. Please correct me if I'm wrong.

[Wookey]

Soultrader,

See how TradeGuider interpreted yesterday's actions. The first green rectangle is "Strength coming in" signal. The bar has very wide spread, ultra high volume, it closed in the middle part of the bar and made new low. Basicaly, I think, the most nervious sellers started fixing their profits.

The next red triangle was identified as "No Demand" signal. The bar has narrow spread and low volume. It signals the end of retracement. You may disregard that signal in ranging market as not really important.

The next green rectangle is called "Climactic action". You see it has ultra wide spread and ultra high volime. In fact it's the widest and highest by volume bar of the day. When you see a bar like this you should think if it's a selling or stoping volume. You may anticipate it knowing about strong support at 12190, or wating for the confirmation which happened on the next bar. In Drummond Geometry a bar like that is called an exhaust.

The second red triangle is a "No Demand" bar again.

Next signal is missed here but you already should see that if you combine two bars in 10 min bar it will be the same signal as the first one.

And the last red rectangle is Upthrust. The volume is not so high, spread is wide, high is hihger than previous several bars and the close is in low part of the bar. They describe it as stop hunting desined by market makers to mislead traders.

Hope that helps.

[walterw]

like it or not Tin... we end up on the same simple corner.... thats a simple hammer with volume surge at support (period).... wanna make it more complicated with vsa etc, etc,etc.... you can make it, but this is the old same good school being thought with some diferent sutil changes.... no new cience here... no new edge... lol... did you notice yesterday how Gavin timed his trades ?.... great contradiction was there... he sayed "weaknes comes on up bars" great input indeed (maybe the only one I did capitalize from yesterday) BUT then his entry was on a swing low of volatility H (old classic past information technical tool, we indicator junkies use) mmmmmm you see... thats a contradiction.... now Tod DID take the trade with the up bar going on.... maybe he has more confidence on what he preaches.... but any way... still the same GOOD old concepts being preached with some variations... I repeat no new cience here... still good cience indeed... Nice trade there Ting.... cheers Walter.

[TinGull]

You're right. There is no new science. Is this still an edge? Absolutely! Why? people overlook the simplicities that can be found in simple analysis like this.

[walterw]

Oh yes ¡¡ there is an edge on the classic aproach and vsa (included in there )¡¡¡¡ what I mean, there is no edge from VSA to the classic aproach.... same thing, diferent presentation and even probably a more complicated presentation....

[walterw]

If you notice Tin you are NOT using VSA software and you are perfectly able to capitalize on the old concepts and vsa concepts all together.... personally your chart is more simple and easy to read than vsa chart...