[VSA] Volume Spread Analysis

[WHY?]

Some one want to take a shot at explaining what happened here? From VSA principles that is. I am reposting my previous chart called "test"that I had posted earlier and some comments were made about it. The second chart I am posting is after the next bar formed. Since we are trying to "anticipate" price (not predict...so as to avoid arguments..but really all the same to me) then could someone please tell me what happened here according to VSA principles. I thought that after reading the comments by others on the first chart that the market didnt want to go down. But it did in fact go down and went down a good bit. What is happening here? Boy does this get confusing to me!!

[WHY?]

I may be stepping out on a limb here and it might break off and I crash to the ground BUT I'm am willing to say that the next bar will show price will go up, or at worst track sideways. My reasoning. It tested the gap to the left. then closed in middle all on relative high volume. The first part of the session no doubt brought selling on but by the close demand came in. That is why the close was off the low. Is this good VSA principles or have I missed the boat altogether???? Comments please. Thanks!

[TinGull]

[TinGull]

As for the last post...I would tend to think it's *possible* for this market to go higher, but it seems to be it would want to correct a little more and a better place to look for a test would be at the top of the last swing high.

[WHY?]

Thanks TinGull for your comments. I am thinking them over. Would like to hear also from others about what happened on the last bar and if the market is now weak or strong??? Williams says strenght shows up on down bars. We had a big one today!!

[WHY?]

Explain last swing high???

[TinGull]

the top of the last box I drew in your chart.

[WHY?]

ok thanks. You actually see it going down that far? It that using VSA principles or do you think that might happen because of some other reason?? Anyway, I guess it isn't that much further. It almost made it there on the last WRB! So, I guess it is concievable it could head on down. But if it does what VSA principle would you think explain such a bearish action?

[ranj]

	Quote:	WHY?
	I may be stepping out on a limb here and it might break off and I crash to the ground BUT I'm am willing to say that the next bar will show price will go up, or at worst track sideways. My reasoning. It tested the gap to the left. then closed in middle all on relative high volume. The first part of the session no doubt brought selling on but by the close demand came in. That is why the close was off the low. Is this good VSA principles or have I missed the boat altogether???? Comments please. Thanks!

why?,

correct assessment of the bar.

Rajiv

[ranj]

	Quote:	WHY?
	ok thanks. You actually see it going down that far? It that using VSA principles or do you think that might happen because of some other reason?? Anyway, I guess it isn't that much further. It almost made it there on the last WRB! So, I guess it is concievable it could head on down. But if it does what VSA principle would you think explain such a bearish action?

Hi Why?

What you want to see is a sequence of events that tell you a move in your intended direction may occur. What I see on you chart is strong attempt to push through supply ( gap, followed by the WRB), then the buying subsiding(slight narrowing of the spread, and low volume on the rally. The price action today is very telling and helps confirm the gap as an area of strength. Today the is high volume, down bar, wide spread, closing off the lows. That bar is not bearish, but bullish. What is also important is that the buying came in an area that we expected the gap. I would look for a test before I entered long. A successful test tells me that the "smart money" is not interested in lower prices, and lets me know that the price with most likely to rise.

Now the price may never retrace with a low vol signal in my interest zone , but that is the price I pay for the way I apply VSA.

Also take a look at the intraday action on this stock and lets see if you had a intraday selling climax, or bottom reversal followed by a low vol test.

Hope that helps
Rajiv