[VSA] Volume Spread Analysis Part II

[mister ed]

	Quote:	Eiger
	It's best to go straight to the source. Why would you go anyplace else? The Wyckoff/Stock Market Institute was originally founded by RD Wyckoff (as Wyckoff Associates). It has operated continuously since the 1930s. There is over 100 years of Wyckoff information here. The best place to start is with the Course. Here is the link: http://wyckoffstockmarketinstitute.com/

Eiger - that is a great post with the Point and Figure charts thank-you. I admire you for keeping them by hand - do you update them throughout the trading day?

For such an apparently simple chart the Point & Figure is rich in meaning. I have been given much instruction in their use by a very valuable friend and mentor but feel I am still just scratching the surface in their application. For showing the build up of 'cause' and risk ... outstanding.

On Wyckoff resources, I have posted before on what is around the net and will add to your link to the SMI-Wyckoff Associates link with a copy and paste of my previous posts...

	Quote:	mister ed
	Hi JJ - There is not an abundance of good Wyckoff material on the net, only a few sites. There is the Yahoo group run by Gassah (who contributes to this board and this thread), this is at: http://finance.groups.yahoo.com/group/Wyckoff-SMI/ There is a broker site with material, at: http://www.ltg-trading.com/site%20map.htm with archives at http://www.ltg-trading.com/archives.htm Gassah put me onto this info at: http://siliconinvestor.advfn.com/sub...ubjectid=54872 I learnt a lot on Wyckoff from a poster on other forums, goes by the name of 'motorway' on Australian Stock Forums and The Chartist forums. While the specifics and charts of what he talks about refer to Australian equities, most of the posts are more to do with principles, which are of course applicable to any liquid, exchange-trade instrument. If you search for his name on http://www.aussiestockforums.com/ and http://www.thechartist.com.au/forum/ubbthreads.php you will get great info. Motorway put me onto this website, which introduces Wyckoff really well, in a straightforward manner: http://www.stockmarket-operator.com/ Really good as introductory material. Nearly forget, there are many articles around by Hank Pruden, do a search for his name and there are quite a few pieces. He has written a book recently, which I haven't read yet, and runs a course in San Francisco. Also, articles around by Coppola and Forte. (Sorry I don't have links, but they are easy to find). OK, paid resources are even fewer. There are books by Richard Wyckoff himself, check them out at Amazon or wherever. There is his 'Day Traders Bible' which can be found as a free download around the place too. There is a book by Jack Hutson: Charting the Stockmarket, The Wyckoff Method. I found it a difficult read, probably because I thought it was an introductory text, or beginners text. It is much more than that and as your knowledge grows of Wyckoff it pays re- and re-reading, there is a lot in it. This book is really cheap, its $14.95 at Amazon and its value is much much more than the better marketed technical analysis books out there. Then finally there is the Wyckoff course run by the Stock Market Institute, at: http://wyckoffstockmarketinstitute.com/ There are free resources on this site at http://wyckoffstockmarketinstitute.com/corner.htm The article at http://wyckoffstockmarketinstitute.com/goal_article.htm is great introductory material. Thats it - if you find other resources, post them up!

	Quote:	mister ed
	Here are the links to the articles by Forte and Coppola.

[mister ed]

I should also add Gassah posts to the "Riding the Wyckoff Wave" thread here on TL too.

[gassah]

	Quote:	Eiger
	Another thing that has keep me bullish is the point & figure chart. The first figure chart (FC) is a 5 point FC of SPX (a pdf file; use the view tab to rotate). I draw this by hand based off the 15-minute chart.

Bull's-Eye Broker from www.archeranalysis.com will create these charts for those who don't want to do them by hand or use www.stockcharts.com. I placed the counts where Eiger did on his chart.

[Eiger]

	Quote:	mister ed
	Eiger - that is a great post with the Point and Figure charts thank-you. I admire you for keeping them by hand - do you update them throughout the trading day? For such an apparently simple chart the Point & Figure is rich in meaning. I have been given much instruction in their use by a very valuable friend and mentor but feel I am still just scratching the surface in their application. For showing the build up of 'cause' and risk ... outstanding.

Thanks, MrEd. The figure charts are really something, aren't they? Wyckoff used them extensively, and they can be a big help in intermediate trading. Funny these haven't been discussed. Bob Evans is the early Wyckoff trader at Wyckoff/SMI I referred to. He did extensive work on the figure charts and came up with a succinct way to use and understand them - really great work, including ways to use the FC to time the market. His Count Guide is linked below, for anyone interested. Consult the Wyckoff/SMI Course - unit 2 and especially unit 3 to learn about figure chart application.

These are the only things I do by hand anymore, but definately find it useful to do. These are based off the 15-minute chart and updated at the end of the day. I don't try too keep figure charts intraday, though sometimes if there is a long sideways line on the intraday chart, I will do a quick FC to see the potential move. For anyone who hasn't kept charts by hand, its quite good to do. You definately get a feel for the market, which you don't get from the computer screen. As i mentioned earlier, its one of the key things that had kept me bullish despite the weak rally.

You can also go to stockcharts.com and get free figure charts, which i often do for a "quickie read" on a stock. There is an inexpensive program called Bullseye Broker (archeranalysis.com) that has good software for figure charting. The other things out there that i have seen use different methods than Wyckoff did, so i don't know how useful they are.

Thinking of hand charts, I used to keep hourly hand bar charts of the major indexes and key stocks, if you can believe it. For intraday, I also used to keep 5-minute swing charts by hand. These are also very valuable to do. (I now have this computerized along with the Wyckoff/SMI O-P index that updates intraday, so I don't even do that anymore!) Doing the hand work is really valuable, though. Another very useful thing I still always do is annotate the bars during the day and mark the VSA indications. It's useful just to go bar-by-bar and note up bar/down bar, spread, volume, significance. Do this a while and it will quickly improve your chart reading abilities.

Eiger

[Eiger]

	Quote:	mister ed
	On Wyckoff resources, I have posted before on what is around the net and will add to your link to the SMI-Wyckoff Associates link with a copy and paste of my previous posts...

http://wyckoffstockmarketinstitute.com/ This is where the original/authentic material on Wyckoff is located. Personally, I think it is wise to be very wary of all the rest. Everyone else adds their own interpretations, ideas, adds things, deletes things, etc. You can get the Wyckoff Course here, plus a wealth of realated materials.

[DbPhoenix]

	Quote:	Eiger
	http://wyckoffstockmarketinstitute.com/ This is where the original/authentic material on Wyckoff is located. Personally, I think it is wise to be very wary of all the rest. Everyone else adds their own interpretations, ideas, adds things, deletes things, etc. You can get the Wyckoff Course here, plus a wealth of realated materials.

The original course may be available through SMI, but Wyckoff's original course is not the same as the SMI course which, as you point out, "adds its own interpretations, ideas, adds things, deletes things, etc". The original course is also considerably cheaper, assuming that Schroeder (who is the Institute) is still willing to sell it separately (the SMI course is currently AFAIK around $900; gassah is in regular contact with Schroeder, so he would likely have the most up-to-date information). Excerpts from the original course can be reviewed on the Wyckoff thread.

[Eiger]

	Quote:	DbPhoenix
	The original course may be available through SMI, but Wyckoff's original course is not the same as the SMI course which, as you point out, "adds its own interpretations, ideas, adds things, deletes things, etc". [/url].

Unit 2 encompasses the original Wyckoff Course and is fundementally the same as the original, mostly reformatting and some clarifying - hardly a reinterpration. The Course was later expanded mainly by the excellent work of Bob Evans. The additional material was kept separate and is found in Unit 3. The other three units include an introduction & overview of the method (Unit 1), practice trading methods (Unit 4) and a "final exam" (Unit 5). There is much valuable material that supplements the course also available from Wyckoff/SMI.

The comment: "Everyone else adds their own interpretations interpretations, ideas, adds things, deletes things, etc" refers to forum threads, blogs, websites, books, software and the like regarding Wyckoff trading. Each of these is neccessarilly a reinterpretation (often quite poor and woefully misinformed, though a few good) of what Wyckoff/SMI has been studying and refining for over 100 years. So again, why not go to the source?

[DbPhoenix]

	Quote:	Eiger
	Unit 2 encompasses the original Wyckoff Course and is fundementally the same as the original, mostly reformatting and some clarifying - hardly a reinterpration. The Course was later expanded mainly by the excellent work of Bob Evans. The additional material was kept separate and is found in Unit 3. The other three units include an introduction & overview of the method (Unit 1), practice trading methods (Unit 4) and a "final exam" (Unit 5). There is much valuable material that supplements the course also available from Wyckoff/SMI. The comment: "Everyone else adds their own interpretations interpretations, ideas, adds things, deletes things, etc" refers to forum threads, blogs, websites, books, software and the like regarding Wyckoff trading. Each of these is neccessarilly a reinterpretation (often quite poor and woefully misinformed, though a few good) of what Wyckoff/SMI has been studying and refining for over 100 years. So again, why not go to the source?

Going to the source is always the preferred route, which is why I use the original course.

As to whether the differences are fundamental or not, this is easily determined by putting the original course in one window and the SMI interpretation in another, then comparing the two. Whether one prefers the original or the SMI interpretation is a personal choice, but one that should be fully-informed. The original course is also considerably less expensive.

In any case, none of this has anything to do with VSA. I suggest that a moderator open up a thread entitled "Wycoff Resources" and move all of it, beginning with winnie's original question, to that thread.

[mister ed]

	Quote:	DbPhoenix
	In any case, none of this has anything to do with VSA. I suggest that a moderator open up a thread entitled "Wycoff Resources" and move all of it, beginning with winnie's original question, to that thread.

VSA is based on one of Wyckoff's laws - Effort and Result - and so saying "none of this has anything to do with VSA" is not correct. The developers of