[VSA] Volume Spread Analysis Part II

[Bearbull]

	Quote:	erierambler
	With all due respect and my humble opinion of course, I would never put any faith or give credence to a certain time period for the sake of the hour or minute . Only volume, support and resistance, demand and supply, and the action of price, is necessary for trading techniques. For me that is........ erie

Precisely, that is the reason for the post, to dispel the claims of any mystical mentors, these reversal time periods have been known for a long time, like everything else in this business, they work some time and at other times they do not, however for some who do not wish to stare at the computer whole day long and have desire to incorporate into their trading strategy and test it out, it can be productive.

[bertg]

	Quote:	DbPhoenix
	If you didn't have support drawn at 1765, you might not even notice it. But there or nearby is the place to enter, if you're going to enter at all. .

DB,

How far back do you go to draw support and resistance?

Can you please show me where you got the 1765 number? Was it on the 20th of February?

Thanks,
Bert

[DbPhoenix]

	Quote:	bertg
	DB, How far back do you go to draw support and resistance? Can you please show me where you got the 1765 number? Was it on the 20th of February? Thanks, Bert

Beginning at the end of the day on the 21st, then tested twice on the 25th. It didn't seem to be more than minor support for pre-planning, but price didn't think of it as minor when it was reached for the second time that day. That entire zone from 1760 to 1770 established on the 19th and 20th offered potential support, of course, but 1765 became a kind of fine-tuning.

Db

[Soultrader]

Joel Pozen recording on ER2.

[NAVEEVIa]

Hi everybody
I am reading the previous VSA thread and do come up with doubts so heres one
In One of posts PP asked a question: Why is a no demand within long shadow a better trade than no supply within range of WRB?( see attached chart)
I have noticed that when there are tails when market is at new high/low PP annotates it as demnad or supply entering . So My guess is that if we see a long shadow at it represents demand/supply entering especially if price is into new ground on very high volume , if we now see a low volume signal there that reaffirms the previous supply/demand seen on shadows.
Please correct me here.
Another question
we can have a no. of combinations of low volume signals in high volume area(WRBs)
1. No demand in dark WRB
2. No supply in white WRB
3. No demand in white WRB
4. No supply in dark WRB
To me it intuitively seems that 1,2 are better candidates for trade since they reaffirm but i may be wrong here
comments appreciated
Naveen

[DbPhoenix]

If you consider the waves of buying and sellling pressure within the bar interval you've chosen rather than focus on the bars themselves, you'll see that a wave that attempts to make a higher high is of greater importance to buyers and sellers than one which is tucked inside a previous bar. Plus it's more likely that the second ND situation in your chart will be noticed by more traders since the intermediating bars may not be visible with a longer bar interval but the swing points will. What is more important in all of this is the lower high at R (assuming that the R is legitimate).

As for volume and WRBs, the two need have nothing to do with each other, i.e., one can have a WRB resulting from a lot of buying pressure and very little selling pressure, or vice-versa, which graphically would show as a WRB with "low volume".

[zdo]

Calling all you cynical VSA’rs
Got any commentary on this chart?

Actually the less jaded (like dbPhoenix) are also encouraged to Wycoff / chime in.

zdo



PS And welcome aboard db.
Not as much button pushing here as over on t2w.
All the best.

[Sledge]

Ok VSA pro's I need some educating.
I watched the GBP/USD daily bar all day yesterday and prepped for its close (See the bar marked with the arrow)
In the chart below you see a very high volume day into "higher ground" closing, not only on the low, but BELOW the prior days close. This as I understand is TEXTBOOK reversal bar stuff!

I waited for the market to drift a tad higher into 11:30 PM last night- I figure the higher the better right? Monster drop ahead!

Now I was able to make pips and profit on the trade- but I'm scratching my head right now as this "monster drop" never came to fruition. At one time I was up 58 pips and when I woke up, found myself taking only a 20 pip profit.

I would like the more seasoned VSA traders to fill me in. Forget the large green bar to the marked bars "right side". I didn't have the luxury of seeing that todays volume would be higher than yesterday when I made my trading decision.

So what is this- temporary weakness that was overcome?
Is the volume way to low to be a "reversal bar?"
I'm dying to find out the answer to this riddle!
Thanks in advance!
Sledge

daily_reversal.jpg

[DbPhoenix]

So why did you exit the trade? What was your plan for the trade?

[Sledge]

[quote=zdo;30987]
Got any commentary on this chart?
QUOTE]

Zdo-
Not sure when you took your screenshot but on my daily chart my volume is quite a bit higher than what you show in relation to the previous bar on yours. I also drew a few trendlines a while back.

As you can see it has broken from its channel and skyrocketed. The "We cracked 1.50" parties are still running rampant- I'm sure. I can say with a lot of certainty that we are now in the "Public Participation Stage" This is where the public is thinking "this bull will ride forever" and the professional money is dumping their longs off their books and gathering shorts. They are feeding the demand in the market.

If I were trading this, I would wait for the fuel to run out on the rocket, let it sputter on the top and strategize for when you will enter for your short. I trade the Cable almost exclusively, but if you are in the EUR every day, you will know its personality better than I. (i.e. does it mushroom over, or are turns more abrupt and lightning fast)

My .02 for what it is worth.
Sledge
eur_daily.jpg