[VSA] Volume Spread Analysis

[TinGull]

jj, I think you're looking for the wrong things, personally. I always used to want to catch the tops and bottoms, and thats what it sounds like you're trying to do. You mentioned seeing potential buying with positive tests....I'd be looking for that in an uptrend. in a downtrend, i want to see hidden selling, upthrusts, no demand...I don't pay any attention to what i think could be hidden buying, UNLESS it's seeming to strengthen up considerably at a large support area.

[ranj]

	Quote:	TinGull
	Just a note on the chart i had posted in here a few days ago...SOLF...shorted on a doji "no demand" at resistance and today things are going very well. Nice gap down and currently is 14.6% lower from the close yesterday, and nearly 20% lower from my original entry.

Great trade Tin.
But what makes it a great trade is not the no demand that you entered on within the gap but the distribution that occurred within the gray rectangle.
When I learned to look at the background as opposed to a 4-5 bar sequence is when I started to really see the power of VSA.

[mister ed]

	Quote:	ranj
	When I learned to look at the background as opposed to a 4-5 bar sequence is when I started to really see the power of VSA.

That's good stuff ranj - thank-you.

Tin, well done on that trade, really well spotted and executed.

[TinGull]

Absolutely, ranj. Nice phase 3 and then a breakaway gap from that....amazing.

[TinGull]

Also, todays action. The grey rectangle is a tail from a candle on the daily charts at this level that it just broke through. This should act as resistance now.

[jjthetrader]

	Quote:	TinGull
	jj, I think you're looking for the wrong things, personally. I always used to want to catch the tops and bottoms, and thats what it sounds like you're trying to do. You mentioned seeing potential buying with positive tests....I'd be looking for that in an uptrend. in a downtrend, i want to see hidden selling, upthrusts, no demand...I don't pay any attention to what i think could be hidden buying, UNLESS it's seeming to strengthen up considerably at a large support area.

Yes but at some point in the day buying/selling has to come in and I don't want to be shorting when the bottom has been reached and we're moving sideways just before an up move. That's the kind of background I'm looking for.
I'm not really looking to call the bottom but to see if potentially we're done selling/buying for the day so I can act on "no supply" if at the bottom and not a "no demand" in the same range at the bottom. Polar Bears in Hawaii (if you've seen the boot camp).

[TinGull]

I haven't seen the boot camp, but think I can figure what that means.

As for what you're saying...sure, buying and selling has to enter into the market at some point on most days. Trend days are an anomaly to that whole thing, though. To me...if I'm playing intraday and price is coming into the last swing low and all of the sudden stops going lower...I'm out. I don't give it a second thought. Price stalled for a reason and I'd rather not be on the wrong side. Now if price glides through that, then Im ok holding. If price does bounce off that last swing low and goes a little higher, and then comes back down and bounces again...thats the background you're looking for regarding higher prices, IMO.

It's really about market cycles. Phase 1, 2, 3 and 4. Thats pretty much all the background I look for and then when I see the market break out of a cycle, I ride it. That's pure Dalton stuff. Hope that helps even just a teeny bit

[BlowFish]

	Quote:	mister ed
	BlowFish - if you have time could you elaborate on what you mean by "looking for continuation/change" please? And how VSA is useful for this? Thanks

Its really a way of continuously monitoring the market from the point of view of continuation or change. Those are the only two choices. This is opposed to looking for 'setups' to occur. Exactly how you react depends on your focus (what exactly you are trying to capture). Its a more 'going with the flow' style of trading rather than an 'entry - stop or exit' approach. As an example steadily increasing price and volume would support continuation of the price in that direction. That is until you detected change (e.g supply swamping demand, demand drying up whatever). I have to say that I am looking at things slightly less from a VSA point of view (at the moment at least) and more from a Whycoff point of view.

[jjthetrader]

Thanks Tin. There's more to weakness/strength then hidden potential buying/selling, I see that now.

[Anonymous]

	Quote:	TinGull
	jj, I think you're looking for the wrong things, personally. I always used to want to catch the tops and bottoms, and thats what it sounds like you're trying to do. You mentioned seeing potential buying with positive tests....I'd be looking for that in an uptrend. in a downtrend, i want to see hidden selling, upthrusts, no demand...I don't pay any attention to what i think could be hidden buying, UNLESS it's seeming to strengthen up considerably at a large support area.

Very nice TG.

A Test in a rising market is a powerful sign of future strength and allows one to surrender to the market.