Tasuki

Regarding the Tradeguider software, I took a 30 day trial with it using eSignal datafeed, and Tradeguider was abysmal, crashing constantly. When I spoke to Gavin by phone, he suggested deleting some of my charts, so I was only looking at one or two at a time. I told him that I could, of course, but that this would limit the usefulness of the software-I want to look at several markets (the major ones) for reference, and at least two timeframes of the market I'm trading. If you have a screaming fast computer, you can still do this with Tradeguider, but even a medium-fast computer will crash or hang with more than a few charts up at once. Personally, I think they desperately need to find a better computer engineer to rewrite the software so it is more streamlined.

TinGull, from what I've read, that looks like a textbook test: 1) lower close 2) volume lower than previous 2 bars 3) close near the high. 4) testing previous low Yup, all four check out---and it worked! Hope you took it long.

Hello "Why", sorry for the confusion---the bar with the vertical line through it us the one in question. Also, I put the chart in bars, as requested. See attachment.

Well, the last time I tried this approach I got some very savvy responses, so let me try ringing the same bell. I've been stuggling with VSA for a while now, and I seem to find lots of exceptions to the rules, places where VSA doesn't seem to work. Usually, it's my lack of understanding that's to blame, but I keep probing until I really understand how to apply VSA. Attached is a daily chart of the Dow. The first thing you'll notice is that I've gone back to candlesticks, abandoning 'traditional' (ala Tom Williams) HLC bars. I do agree with previous posters (esp. PP) that the candlesticks provide another level of information that is valuable for VSA. The text in the chart gives the layout of my dilemna. After reading a series of posts a few pages back on this thread, I've been hunting for high volume + small range days as well as high range + low volume days, and the chart shows one of the former type. On the surface, it appears to be a perfect example of the professionals selling to the giddy public, but here's the fly in the ointment---it doesn't meet ALL of Tom's requirements for market top. Quoting from p. 76 of Master the Markets, "So, the essential ingredients for this bearish indication are: an up-day on high volume with a narrow spread, into new high ground." Each element is essential for an accurate signal." So, the fly is the 'new high ground'. On p. 75, Tom says that you can have "nothing higher on your chart to the left". As you can see from the chart, there IS something slightly higher to the left, from about July 16-23, or thereabouts. So, the question I'm asking myself (and all of you) is--why don't the higher prices in July act as resistance, and why doesn't the distribution that comes after them provide even more fuel for the bearish case at the bar in question? As most of you know, Tom's book, and Todd Krueger's work, are chock full of examples of the vital importance of looking at the "playing field" and if you see distribution to the left, then you've got a more bearish picture when you come back up to that resistance zone. If you add up all the VSA signals, it looks to me as if this should have been a pretty clear bearish signal. Did VSA just fail us, or am I missing something crucial?

Rajiv has the right idea---posting charts that give VSA signals at the hard right edge. Good job, Rajiv! When I get good enough to spot signals like that, I'll post 'em. Taz

The funny thing is, the first time I took a free trial on a squawk service, I found it to be incredibly distracting. This second time, however, I understand my own signals well enough that I'm more relaxed, and I like to study the tug of war at support/resistance areas. To do this well, you really need to stay glued to the charts, and the squawk gives you another dimension to the action. It's actually pretty much fun, but you have to enjoy the battle.

After following the squawk for just a short while, here are my initial thoughts: 1) The big boys (Merrill, Goldman, Deutsche Bank, etc.) can be wrong, or they may be doing some sort of fakeout that you're not privy to--conclusion: don't ever trade based on what the squawk caller says the big boys are doing. 2) Sometimes the caller says something really valuable, such as "the locals are going to whack the eminis" and then you probably can trade on that--this happened last friday, and the caller was dead on the money. 3) If you get a good caller, there is alot of information they transmit if you know what to listen for---e.g. Ben Lichtenstein's Q&A session has been invaluable in this regard. 4) There is a certain sophistication to the noise levels in the squawk. Here's one valuable tip: if price is coming up to strong resistance, and then pierces through with a SUDDEN burst of noise in the pit, then you're best bet is to fade the move. If, however, the noise builds slowly, then the probably favors a true breakout. Taz

Just curious if anyone uses a squawk box service---if so, how useful have you found it? Does it work only for scalping, or can you judge with any reasonable accuracy where pivot tops and bottoms will be put in, and if so, what do you listen for?

TG, if I squint real hard, I can indeed make it out. If nobody else is having trouble with this, I can just copy the chart with Snagit, then enlarge the image so my geriatric eyes can see it more clearly. If you look at some of the charts I've posted, I try to put clear white text on pitch black background. Seems to work well (good example on p. 30, permlink #291).

TinGull, yes removing the bold might help. Thanks.

Is it just my old eyes, or is anyone else having trouble reading the text inside Tingull's charts?

Continuing the discussion of the 9/11 attacks. Here's a "fact" that seems to argue against the idea that it was an inside job planned by the Bush Adminstiration: On the latest tape that Bin Laden released (which apparently was authenticated as really Bin Laden), he BRAGS about knocking off the twin towers. Now, I don't speak his language, so maybe he wasn't actually bragging (he could have been talking about the weather for all I know), but it was reported that way on the news. IF someone who can actually speak his language could verify that this is what he was saying for a fact, then we would appear to have a very convincing argument that the Bush Admin. did NOT pull the job, because one cannot think of a man like Bin Laden cooperating with the US government. Does anyone have an argument to refute my logic?

Thanks, Walter. Correct me (please) if I'm wrong, but the Volume Delta records actual trades, buys and sells, whereas the bid/ask tape indicator records bids and asks, namely people who SAY they're going to buy or sell, but they may or may not actually do so, if they pull their bids/offers before they're executed. Am I right about this?

When I plot this indicator on a 233 tick chart of the @NQ, all I get is a straight line (Tradestation version 8.2 build 3896). I tried changing the settings so the "for volume use:" said "tick count" and then I put it back to "trade vol" but in both cases I got the same straight line. Now, I'm trying this late at night on a Saturday, so maybe it only works with a live chart?

Just sent Todd Krueger an email telling him about this forum and inviting him to visit. A little presumptuous of me, perhaps?

Let's review the definition of an upthrust: 1) spread high 2) volume high 3) close off the high, preferably low (preferably, says Tom, not definitely) 4) appears AFTER sign of weakness ("distribution area directly to left) Shreem, your putative upthrusts both fail test #4, as least as presented in the chart you posted. This is crucial, because without any weakness to the left, what you've got is a market pushing up.

Here's a strange request. This thread has detailed a legion of examples where VSA has worked. But nothing works EVERY time. Can anyone find examples where a VSA signal failed? They might be as instructive as the ones that worked.

James, Reading over your original post, it seems that you might have been unfocussed at the time of your trading. For example, you said you made errors with the Tradestation matrix. Personally, I think it's poorly designed, and I rarely use it for that reason, but lots of people use it without mistakes. You need to concentrate on what you're doing when you push those buttons! In short, if you're not in the "Zone", don't trade real money. I have to say that it's easier for me to be in that Zone when I have an elegant trading platform, and I don't know of an easier or better one than the Infinity AT platform (I'm a customer, but I have no other financial relationship to the company). You might want to check it out--much easier to use mistake free. Also, it appears that you are not taking your trading environment seriously enough. Dogs in the trading room? A complete non-starter. Thirdly, you said wistfully that you lost sixty bucks here, fifty bucks there. Amigo, that's chicken feed. If you're sweating over such small losses, perhaps you're not sufficiently well capitalized to be trading at all? Just asking. The subject of proper capitalization has been covered eloquently by many people, and it is an issue that needs to be considered.

Thanks, Steve. Just trying it now, and the "tick count" trick works great.

Some folks in this thread have posted Forex charts---with volume bars. Where the heck do the volume bars come from? As some of you no doubt know, Tradstation has recently tried to increase its revenue stream by offering Forex, but I can't get any sort of volume bars to show on them. Yet some of you get volume bars on Forex, so I'm really really puzzled. I seem to recall that Forex markets don't report the volume (and Tom Williams had some choice words to say about that I remember--the SOBs don't want the retail traders to know the volume because that would tip their hand). Anyway, my big question is, how do you folks get volume bars on Forex charts, and is this volume true volume or "tick volume" (just the number of trades, not the number of contracts in each trade)? Thanks.

Shreem, thanks so much. Between you and PP, this VSA thread has become incredibly valuable. Now I just have to spend the hours necessary studying the charts to see these patterns in real time. Many thanks, and good trading to you. Tasuki

shreem, In your first chart you say, "Up-thrust and a squat bar at the same time." Aren't they the same thing? If not, how are they different? Maybe it depends on the volume?

Thanks, PP. I have indeed been spending way too much effort thinking of VSA as one bar patterns. I need to re-evaluate my VSA signals as two bar patterns at least. BTW, you mentioned that there are some VSA patterns that unfold over three bars. Is there a list somewhere of which ones are one, two or three bar patterns? Maybe it would be helpful to create a comprehensive checklist of the VSA patterns, where members can add, subtract, and refine the definitioins? I was creating one for myself, but obviously I need to re-think my descriptions in light of PP's (as always) brilliant commentary.

The Breakout Breaker. Have any of you heard Tom Williams analyze a chart? He is completely amazing. He will go through a chart and explain every single bar. The Tradeguider software will give you indicators every so often, but not every bar like TW. Even Todd Krueger doesn't seem to be able to do what TW does. Well, if Tom's VSA prowess is such that he can see meaning in every bar, and if VSA terminology doesn't seem to have an explanation for every bar, maybe there's room for some new definitions? I'd like to offer one I call the Breakout Breaker. To illustrate, I'll use Tingull's great chart from page 33 (permalink #330) (see attached chart). This is the same chart TG showed, except with the classic HLC bars, as well as my notes. The basic premise is this-- you're coming up to resistance, and the live bar pierces that resistance on increased volume, and closes near the high. All of these factors are designed to fool traders into thinking that there really is demand coming in, and that higher prices will follow. The fact is, the professionals have figured out that people are looking at volume nowadays, so they bump up the volume to make the breakout look real. When this happens at resistance, BEWARE. Wait to see how the next bar behaves. p.s. if anyone else has new VSA definitions that are not covered in the canonical writings, please share!

Blowfish, Not exactly sure what you're asking. Could you rephrase please? From what little I know, these look like pretty classic signs of weakness. Beyond that, I'm not sure what the question was. As an aside, I'm puzzled by the coloring of the volume bars.Ok, maybe I've got it now---if the volume is higher than the previous bar, it gets painted green, if volume is lower, it gets painted red. Have I got that right? My eyes want to tell me that green volume bars accompany a higher close in price, but that's obviously not what's going on in those charts. Taz