CandleWhisperer

I read somewhere that VSA is a big tent. I like that. It is clear that most of the traders on this thread do not do things exactly the same. And if you include DB (not a VSA trader per se, but a Wyckoff trader/supply/demand trader using PV) this becomes even more evident. That is, DB is doing incredible work far beyond most. It is elegant, simple and effective. As far as drawing support and resistance in real time, there are many ways to do it. After reading the first thread and posts by Nihabashi, I prefer to look at WRBs and Long & Shadows now. There are many things I can't say about them and far more things that I do not know as yet. But what I can say is this. Those that use candles can easily see a WRB appear. The definition is simply A WRB is body (open to close) that is larger than the prior three intervals. A Long Shadow (upper) would be an upper shadow that is larger than the prior three long shadows (only). And the opposite would be true for a Long Shadow (lower). Now, there are various was to determine what makes one WRB more significant than any other one. Two of the main things I look at is size and volume. Hence, in real time if there is a WRB that happens to have high to ultra high volume or is larger than the last three WRBs it is significant. The three prior WRBs is flexible, but once one decides on a criteria, one should stick with it. It may be different for the individual instruments traded. Subsequent price action will tell you that. So one can easily determine what is a significant WRB, or Long Shadow. As far as trading it, it is always best to let the market prove it. Why go short simply because price is rising towards a supply/resistance area? Many "pivot" traders make this mistake. Just because price is moving towards R1, doesn't mean go short. Price can continue doing what it is doing: going up. However, one can become more attuned to price action as price approaches R1. Take a look at the chart below. These areas were easily plotted after the appearance of the WRB or Long Shadow. As so many seem to not want after the fact learning experiences, I will say nothing about a trade set up. It is labeled and if asked I will give my $0.02

In the true sense of the word, a mentor would not charge. He/she would want to lend a hand to someone because someone first lent them one on the way to the top. Here, we use the term mentor in lieu of the words teacher or coach. Jordan had a coach. Tiger Woods has a coach. Most of the elite persons in their fields have coaches. Why would trading be different? Note that Tiger's coach teaches the best golfers in the world, but IS NOT one himself. He is the best Golf Coach in the world. The issue may be that the secret to trading is that there are no secrets. Put as a question, "are there truly any secrets to trading?" But a mentor/coach should be FAR more than "This is when you buy, or this is when you sell". A mentor teaches you how to set up a business. How to handle the pull back as CNBC reports GDP and all the anchors are gloom and doom. Or conversely, how to disregard perma bull BOB Pasoni (SP?) and focus on what the Tape is actually saying. As far as price, I think the mentor need only charge enough to cover living expenses and externalities. The money made in the market would just go to grow the account.

James what's up? Gold was taken out to the wood shed today and beat like a redheaded step child.

Well, BF, you have given away a few nuggets in these threads so I hope no price is enough. LOL What if you could pay all your bills and all your externalities through mentoring one or more traders, while simply growing your account through trading? The price in this case doesn't have to be that much. It merely has to keep food on the table and you living the life you are accustomed too. The real age old question is: Do you believe that there are really any trading secrets? And if so, do you believe that sharing them to a limited amount of people will render them null?

First, I hesitate to leave a chart. Not just because it is after the fact, but because as previously stated, my charts are designed to emulate PP. However, my attempt to tell the story was a bit off as I was just trying to recall the price action. Here is a chart with what happened. A: Large Dark WRB on Fed announcement. WRBs represent changes in supply/demand. The BBs use these type of news events to either load up or dump positions onto the herd. Note volume is higher than previous bars but not all that high for a news release. B: Up close but we close on the lower portion of the bar. Notice that a Long Shadow is created. There is selling pressure (supply) on that Shadow. We now have 2 Zones: one created by the dark WRB and one Created by the Long Shadow. C: Another up close. Note how volume has increased even more. Markets do not like up bars on high to ultra high volume. D: Equal close on a buying bar. The move into new higher ground as opposed to the previous bar on low volume shows weakness. E: Another buying bar. This one closes near its lows on volume less than the previous two bars. This is an up thrust in the form of no demand. The true intentions of the BBs is to take the market down. This is the "head" fake move for the heard that has seen all the "up volume" on the two up closes. There is a story that unfolds here. It is congruent with my believe system. It is more important therefore that I am prepared to go short after the up thrust than be right.

My issue with your question is two fold: 1. You have a thread called candles and VSA (or volume) which implies you see some value in VSA/PVA. 2. You then stated that you have no desire to learn VSA,PVA,Wyckoff. I have no intension of learning STR with all those channel lines. Interesting charts to look at though. But does it really matter if all those people on elitetrader can actually trade that way? Not if I am already predisposed to reject it.

That is the key. One's approach to the market should tell a story. That story must be congruent with the trader's believe system. In other words, it matters less if you go long or short , as it does WHY you are going long or short. One's market beliefs should create and be consistent with whatever one's method is. Yesterday for example when the Fed news came out, there was a large Dark WRB on the 5 min Euro chart. The volume was lite however. The next bar was an up bar that closed near its low on high volume. This bar also turned out to create a Long upper Shadow. Now this tells me that there was Supply entering on that bar. This is part of the story the market is telling me. The next bar closes even on more volume with a narrow range. Price is being held down. Why do I say this? Because my story says that narrow range increased volume means the market is being kept within a narrow range by those that can see both sides of the market. The next bar was the clincher: a buying bar (higher high but not a lower low) that closed near its low on volume less than the previous two. This is an upthrust in the form of no demand. Of course this candle was within both the Long Shadow and the Dark WRB. My point. If you can tell the story than you can pull the trigger. It doesn't matter if you are right or wrong. This game is about making money, not ego busting thru being right. Hinsight analysis helps us learn how to read the story the market is telling us. This is the pre-planning that come before any "Call" can be made.

If I, or 10 others say yes, will you begin to study it? If not, what does it matter to you? At best real time will only tell if someone can make calls. It does not show if one has the metal to stay in the trade when a dark WRB shows up counter to the up trend. It shows you how the caller is able or unable to handle a market that loses volatility right after entry. I am sure you know of many people that can call direction but couldn't TRADE to save their lives. As long as no one is here trying to see pdfs or mentoring services, there is really nothing to prove by real time calls. Even the videos can be suspect. Sebastian doesn't have to put the video on if the trade is a loss. We would never know it was even made. Most traders here are trading on timeframes of 5 mins or less. It would seem to me to be hard to: (1) place a trade. (2) take a screen shot (3) make a post with an image (4) and oh by the way manage a real money trade : trailing stops, taking profits at targets, et all. With all that said, it may be interesting if some of us attempt to make calls off a daily chart just to appease some of the nay sayers. But again, this proves nothing about a person's ability to trade the principles.

At the heart of VSA is the idea that markets are manipulated. This manipulation is especially evident (still hidden to the masses, or herd) is during news releases like a fed day. The high volume from the herd and uninformed institutions creates the backdrop for the BBs to dump their positions or load up on them. If you believe this and trade via VSA, it makes no sense to say "don't trade on a news event like the fed day". It is the very type of day where you should be trading. That is not to say that one should not be careful or try and front run the news. To be sure, one should be on the sidelines during the release itself and look to play the reaction to the news or the reaction to the reaction. Simply, important changes in the supply/demand dynamic tend to occur around these news events. Traders who look at supply/demand really should be looking to trade therefore.

you misunderstand. I did not mean your experience, I meant other traders. But I did mean I would of thought you found value in trading around such events.

If we don't ask, how do we learn? Price and Volume trader. Generally speaking this means sans indicators.

Interesting. From a VSA perspective, news events are the very things the Big Boys use to manipulate the market the most. The increased volume allows them to mask their intentions that much more. The prudent thing thus is to ignore the news itself and pay attention to the Price Action after the news. Sometimes the BBs leave signals prior to the event, but most do well to sit on the sidelines as the news comes out and then focus on the reaction to the news, or the reaction to the reaction to the news. I am kind of surprised that DB, while not a VSA trader but a PV trader, would say stay away. I guess that has more to do with one's level of experience than the type of day itself. I also know that the WRB & Long Shadow guys expect major changes in supply/demand to show up on or around News releases. Again it is not about trading the news event. It's about understanding the possible change in supply/demand the BBs create because of the news event. One might goes as far as to say, create with the help of the news event.

1. First, I do not like TG software. I will however, say in their defense that triangles are not as strong of signals as rectangles. 1a. There is no weakness in the background. This is a "Polar bear In Hawaii". 1b. There are not obvious areas of resistance on the chart. Even a basic pivot level might add some value to the sign of weakness. 1c. These are NOT buy and sell signals they are signs of strength and weakness. If you are using them as signals to go long or short you are no better than the guy following RSI signals. 2. End of a rising market is a narrow range bar on ultra high volume closing on the high into new ground. Simply, this in NOT that. It is a Transfer of ownership type bar that does not result in downside price action. Hence we have effort with no result (this is strength). 3. These thing happen in various levels of intinsity. What may be happening here is mere profit taking. 3a. I hope you are not looking for that holly grail method that neve takes a loss. Losses happen. Methods are wrong. ALWAYS USE STOPS AND DON'T GET MARRIED TO A POSITION.

Just a couple of things to note:

Bearbull; Thanks for the info. It is just that many of your posts seem to pooh-pooh VSA and TG in particular. I too am no fan of the latter. It is likely true that there would be a green indicator at A on the chart. Yet, even the folks at TG would say that they are not buy and sell signals, merely signs of strength. A trained eye would not that the volume was less than the bar I mentioned that closed near its middle representing supply swamping demand. The trained eye would also of noted that the close was not on the high and neither was the next bar up. This means it was not a Shake out. In other words, the high bar was not a place to go long in itself. Everything you said about the 1 minute is true. Clearly you have a grasp on some key principles of PV trading. Thank you for your insights and please keep them coming.

"Wall Street II" is in production.

Simply, Yes. They are far better than mathematically derived numbers like "Floor Pivots". Key Numbers, aka floor pivots, derive their utility from two things: regression to the mean, and self fulfilling prophecy. Market profile lines have as their basis the concept that because the market found support/resistance at this level today, all things being equal it should find the same there tomorrow. The market has memory. It knows when a price level is reached that found sellers/buyers the previous time the level was reached. If 510 on the emini, for example, brings in the bulls today as they see value, there is a good chance they will again see value at that level going forward. I have been playing with this concept a bit after reading an article from Straightforex.com. Instead of using key numbers, they use what they call a "Market Map". The map consists of: 1. YH (Yesterday's High) 2. YL (Yesterday's Low) 3. DYH (Day before yesterday's High) 4. DYL (Day before Yesterday's Low) 5. PP (Pivot Point) (O+L+H)/3 The first 4 are already HUPs (Hold Up Prices) and may continue to be. One thing the map tells us is if price is above the PP the trend may be up. If Price is above either or both YH or DYH and above the PP the trend is up. The reverse would be true for a down trend. After reading a couple of threads on this forum, I have become predisposed to the Pivot Range concept that Pivot profiler talked about. So I add the Range to the map, plus a couple more HUPs.: 1. YH 2. YL 3. DYH 4. DYL 5. PMH (Pre Market High= highest high made between 5pm close and 2am open NY time) 6. PML (Pre Market Low= lowest low made between 5pm close and 2am open NY time) 7. PP (H+L+(2*C))/4 8. PRH (Pivot Range High) 9. PRL (Pivot Range Low)

Why would anybody go long at A? Yes demand entered the market but it is not a reason to go long. Note that this bar forms a dark hammer with a long shadow. What you would now look for to go long is a no supply or test within the range of this long shadow. If you trade hammer patterns, you would not that to go long you have to wait for the close of the next candle, which needs to engulf body of the hammer (Mark's rules). In other words, the no trade signal at A. Also note the Ultra high volume bar with the close in the middle. This bar shows supply swamping demand. Hence, the background is pretty weak at A. You can see the trend for yourself.

What? You must have not seen "All In". LOL.

LOL. DB when I posted your pick in the real VSA thread, before it was closed, I said we had an up bar closing in the middle on Utlra High Volume: a transfer of ownership type bar signaling weakness. Your revised pic shows an up bar closing in the middle on volume less than the previous two bars- no demand and thus weakness. net net.

Here's a chart provided by DB. From a VSA perspective, we see a bar that represents climatic action. Or stopping volume. It makes a lower low and closes near its high on ultra high volume after a down trend. Like the name implies, this stops the down move. Price then move up. Suddenly we see an up bar on ultra high volume that closes in the middle of its range. Note that this is the highest volume bar on the chart. If there were just buying on this bar on all that volume, then price should not close in the middle of the range. Price moves down a bit and then we get a test. Note how little volume there is on this candle. If there is no supply, which is what they are testing for, then price is free to go up. It does.

I like DB. He is a welcome addition to the forum as a whole. Truth is, PP mentioned him in this thread long before anybody else did in the other thread. However, the new thread seems to be getting off topic. So this is a bump to raise the original VSA thread up to the top so actual VSA teaching and learning can go on. Also, If you have a problem with Joel, grow a pair and tell him. Don't use this thread to not so subtly mask your disdain or inability to grasp what he tried to impart.

Actually VSA states that the Big Boys (BBs) are not all working in concert. VSA also states that not all "smart money players" are in the know. Tom would say that some of those Mutual fund managers with their MACDs and moving average crosses are no better than the herd; a term which is usually associated with small retail traders. As far as the auction process goes, there may be some truth in what you say. While Todd Krueger uses market profile along with VSA, it does seem that there is a dichotomy between market manipulation and fair auction market theory. Yet the propensity of value area lines to act as support or resistance is evidence of sameness or at least a symbiotic relationship. Regardless, the truth lies in price action. Price does not lie.

My $0.02 : The third blue line labeled as bearish is in fact not. It is a down bar closing in the middle on volume less than the previous two bars: this is strength. The next two bars are indeed weakness. The second one is no demand. The bar after that is a failed test. The volume is high with a close near the high. There are sellers underneath so any move up should be muted and we can expect lower prices. okay let's put it all together- We see a down bar that closes near its middle on volume less than the previous two bars. This is no supply. The BB's see that there aren't any sellers underneath. But the volume is still relatively high. The next bar is narrow and closes equal on even less volume. The bar after is up an is no demand. The BBs don't quite want to take the market up, but for some reason they are hesitant. Next bar we see a test. They are testing for supply, with the amount of volume on the bar; they found it. Price may go up but it will be muted.

JJ; Thanks for your brilliant insight. I have added the chart with just a few things that I picked up from the first vsa thread. The test comes within the body of a WRB. You are correct, the first two bars are not tests.