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John Baron replied to John Baron's topic in Volume Spread AnalysisWhat market do you trade? Because VSA is better used in Stocks and I use the analysis like LRA for a long time. And using cause-effect methods of analysis like LRA does not require the use of the order book. We need to search Locked-in Ranges where current Open Positions are locked in loss and it is profitable for the market maker to quote prices above or below the range depending on the sentiment.
John Baron started following VSA (Volume Spread Analysis) vs LRA (Locked-in Range Analysis)
John Baron posted a topic in Volume Spread AnalysisLet's compare two cause-effect methods of analysis which help us to make our FOREX trading strategy more profitable: Volume Spread Analysis (abbr. VSA) seeks to establish the cause of price movements, and from the cause, predict the future direction of prices. The ‘cause’ is quite simply the imbalance between supply and demand in the market, which is created by the activity of separate professional operators called "Smart Money". Locked-in Range Analysis (abbr. LRA) seeks to determine the direction of the prevailing volume of open positions which will allow to join the further profitable price changes for all united market makers called "centralized automated market-making system". For example, both methods use the chart and volume to analyze, but have different basis: VSA: Activity of separate professional operators (Smart Money) LRA: Logic of price changes in the futures markets (where a liquidity is provided by Market Makers)