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Old 05-15-2008, 10:40 AM
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Re: [VSA] Volume Spread Analysis Part II

Thanks Db - I don't want to get into a protracted discussion about VSA and "what it is, or at least in terms of what it has become, and not expect it to be what it isn't and can't be" (not on this thread anyway) but can I ask what you think of the sort of range expectation you could have from interpreting, for example, a "no demand" (given proper context/background etc.) on various time frames of analysis.

For example, if I was using say the 5 minute bar and everything pointed to a downmove (context/background, support/resistance, "no demand" etc., all lined up nicely for me) my expectaions on the ES might be for 3,4,5, whatever points, or even a move down to whatever support I had interpreted on the 5-min bar chart. If, though, I was using an hourly bar and everything pointed to a downmove (context/background, support/resistance, "no demand" etc., all lined up nicely for me) my expectaions on the ES might be for a move of a larger magnitude, maybe 10, 12, whatever, points. In these two examples the magnitude of the profit expectations differ because of the magnitude of the timeframes differing and where you say:
"a "no demand" bar means "no demand" at that time, and that the lower prices that the bar implies may occur for only a couple of bars", then the choice of timeframe chart is going to be a determinant on profit move expectations?

So, VSA may be useful for scalping, as you say, but depending on the timeframe may be useful for larger magnitude moves also?

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