VolumeJedi

I don't know your trading background, but I see you have less than 10 posts here. As such I will assume you are a "newbie", forgive me if I am wrong. You are asking the wrong question. This is the type of question many newbies and losing traders ask all the time. Before one gets to this question, there are far more important questions and underlying beliefs that must be ascertained. Do you believe that there is a buyer and a seller at every price? If so, then how can there truly be such a thing as "overbought" or "oversold". Where you stand on this influences what indicators you might look at, or at least force you to take a different take on them. For example, it may make more sense to look for a rising stochastic as trade bias versus looking for a reading above 80. Do you believe that price is where it is at because that is where it is supposed to be, and price is supposed to be there because that is where it is at? Do you believe the market is always right. If so then the market can not over shoot or go too far in one direction or the other. Do you want to use indicators that are trying to measure these over extended states, which you might not even believe exist? If you do believe they exist, might price itself be a better way of determining this condition? Do you believe that price is driven in the short run by "technicals" and in the long run by fundamentals? Does this mean trade direction should thus be based on fundamentals and entries based on "technicals" (technicals would include either indicators or price action or Market Profile to name a few). What type of trader do you want to be? Are you looking to be in a trade for two minutes, two days, two weeks, or two months? Do you believe that since the market is made up of human beings it will tend to be ruled by some of the things that naturally rule humans? If so, does that mean studying phases of the moon is a valid approach? Maybe using indicators is good because the "herd" uses them and you can use the herd mentality to your advantage. Where do you stand on the golden ratio? Is this ratio and Fibonacci numbers some sort of universal mathematical code? Since we can see it in a sunflower, does that mean we should see it on a price chart? Do you believe that there is a selective few that tend to be correct more than they are wrong in the markets? Is there a way to track their movements on a chart? Do you need to read the tape to see them? Do you consider reading a price chart akin to reading the tape? There are many more questions to be sure. In the end, we all trade our belief systems. It is important have a solid understanding of what those beliefs are. Some may be right and some may be wrong, but they are ours and therefore need to be recognized. That's why Bill Williams says that if you want to know about yourself, you can spend years meditating on a mountain in the Himalayas, or you can trade the S&P on a five minute chart.

Really want to watch this but I am not hearing any sound. Is there audio here or not?

Hi 4rings. Glad to have you aboard. We need more posts like yours so we can all learn from one another. I think its very helpful to see different opinions of the same chart. Anyway, this is a hard one for me. Not sure what LVS is, not that it matters. But please post a chart to so I can see what DID happen. Thanks. Again this is a tuff one here. I hope what I say helps and if I am wrong , hopefully somebody will chime in and put me on the correct path. That's all I can hope for. A: This is a narrow range up bar on ultra high volume. A squat. Supply is swamping demand on this bar. The high volume and narrow range tell us that the "market makers", the ones who can see both sides, are bearish. There is a lot of supply being dump into the market to the herd. They think they are getting a good price here, but don't understand the reason behind it. As we see on the next bar B, price falls confirming the supply on the previous (A) bar. Now it gets muddied. B: Scenario 1: Increased volume on a down bar closing in the middle of its range or slightly above it. The close is down and the bar makes a lower low. This bar could be a failed test as the volume is too high for a successful test. If this is the case, there is supply in the market and price is likely to fall. Note that the next bar © is an up bar on volume less than the previous two bars closing near its high. It is no demand. This is consistent with bar B being a failed test. There would be little smart money participation to the upside with all that supply lingering in the market. The next bar narrows further and the volume continues to dry up. More signs that bar B was a failed test. Scenario 2: Increased volume on a down bar that makes a lower low and closes in the middle to upper portion of its range. The long tail of this bar could be showing professional support thus making this a bullish bar. We know when strength appears, it appears on down bars. If this is bullish, we would expect prices to rise slightly, but come back down and TEST around this area. The low of this bar should act as resistance. Basically I am neutral here. If it is 1 (weakness) I would look for an up bar or a slight pull back finding resistance at the low of B to go short. Of course that up bar should be on low volume. If it is 2 (strength) I would wait for a pull back and a test in the area of B. This time the down bar should be narrow and on volume less than the previous two bars. The one thing that I do know is that neither bar is a signal to jump into the market at this moment for me. Hopefully others can enlighten us on the situation. Edit: added chart

Hello. Thanks for the questions. Hope I can help. Like yourself, I am a student of VSA so I may be wrong here. But if we put our heads together, we should get to the answer. LOL. As I understand it an ideal test bar will make a LOWER low and not a higher high. It will close down and have volume less than the previous two bars. The close will be either in the middle of the narrow range or at the high and DOWN from the previous high. It is confirmed when price closes higher than the close of the test bar. And this should happen within the next 1 or 2 bars. Again, I have mentioned the idea of "Selling bars" before. A "selling" bar makes a lower low and not a higher high. The herd calls them "selling" bars because they make lower lows and they see this as a sign of weakness. One definition of a downtrend would be successive price bars making lower lows. What the herd does not see is the lack of volume on the bar. We know that the reason for the dip to lower lows is see, or test, for supply. If there are sellers in this area volume should increase. Also take note that an ideal test will close lower. Yet another sign of weakness to the uninformed. Of course there are test that are not ideal. Tom talks about some futures markets that usually have high volume tests rather than low volume ones. Normally, as you correctly pointed out, high volume means a test has failed. The BBs marked prices down to search for supply and found some. Hence the high volume. In the case of 4&7 we get higher closes on or near the top of the range. In these cases the high volume signals that there was support (buying/demand) as price was marked down. Had these bars closed lower than their respective previous bar, they would have been failed tests. Now as I said in the next post, some test do in fact close up. The bar I described as a test that closed up was immediately followed by a surge in price. That helped me see the bar as a test. Generally, there should be immediate reaction to a test. That is why another way to see a failed test is to not see a higher close within the next 1 or 2 bars. Things do get even trickier as it is possible for a test to be an inside bar (not make a lower low nor higher high). But let's leave these for later.

Beautiful. Hope you like this chart and can learn something. Please tell me what you think is important that I may have missed. As the thread is not very active currently, the view you are getting is a bit one-sided, I hope that's not a problem. Let's take a look at the chart below: A: This is a "transfer of ownership" type of bar. We have a narrow range down bar with ultra high volume closing in the middle of the range. This bar is very bullish. We wouldn't go long just off this type of bar anyways, but we have to be especially careful here as it is just after the "open". B: For the Market Profilers, this bar sets our initial balance, or opening range, low. What the VSAers care about is that this is a wide spread down bar closing off its lows on ultra high volume with the next bar up. All that volume can not be selling. Otherwise, the next bar would not be up. There is a desire to take the market lower on this bar, hence it is also an Effort to Fall. This will become a key thing to keep in mind. Some BBs are entering on the sell side in this price area. Remember, VSA states that not only are the BBs at war with the herd, they are at war with themselves. No smoke-filled rooms with all the BBs making decision together here. THE ENTRY SIGNAL ZONE The numbers on the volume correspond to the bars in the shaded area. 1 is the first bar reading from the left and so on. 1: This is a narrow (NR7) rage bar closing down on volume less than the previous two bars. This is no supply. The BBs on the "right" side of the market, are checking to see if there is more supply in this area. If there is an abundance of sellers in this area that means there is too much supply in the market. Why here? Because this was the area that brought sellers into the market once. 2: Increasing range bar that closes near its low on volume less than the previous two bars. This is no selling pressure. The increased range and close near the low belie the fact that there is little professional activity on this bar. Argo the professionals are not interested in lower prices. Yet another example of a low volume bar within the range of a high volume bar. 4: This bar makes a lower low then trades up and closes near its high and higher than the previous bar. Taken with the previous bar it is a not so good example of a two bar reversal. Some might think it one though. Regardless, it is a bullish bar. It is an up bar closing near its high on increasing volume. Yet the volume is not too high. We also note that this up bar has volume greater than the two previous bars where volume was decreasing on each bar. 7: This bar looks a lot like 4. This bar is marked down lower than the previous bar like 4, but this one goes even further to the down side versus the previous bar. We see rejection as price is marked back up only to close on its high. Again volume is increasing on this up close. If you look at this bar you see that it is a "selling bar". This is where the second level thinking of the BBs enters. The herd think this is a weak bar because it makes a lower low and not a higher high-the definition of a selling Dunnigan bar. But the up close on the high after the strength in the background tells the VSAer that this is a weak bar. The lower low shows professional support entering to Prop price back up. Whilst Tom argues for only entering long on down bars (1&2), any of these bars are good places to get long. Of particular note is the fact that we never got a test. We got other evidence that the BBs were not interested in lower prices, but we did not get a test bar. If either of bars 4&7 had closed lower, then that would be a failed test show some residual weakness(supply) still in the market. C: Markets do not like up bars on high volume, because there could be hidden selling into the up bar. However, not every up bar is weak. This bar closes on its high with the next bar up and has decreasing, although somewhat high, volume. This is a strong bar. Note that the mid point of this bar is higher than the high of the previous bar. This bar takes us thru the opening range high. D: This is an Effort to Rise. Here we do have increasing volume on an up bar that closes off its high with the next bar down. Normally a sign of weakness. This bar, however, is strong. The high volume is absorption volume. This bar is pushing thru an old top to the left (see previous chart about the short) and yesterday's high (not shown). E: I just put this bar in to show an up bar on ultra high volume closing in the lower portion of its range with the next bar down. This is a weak bar. However we now have acceptance above the balance area and the market finds support around the high of the balance area. Also look at the bar prior to E. It is a strong bar. Note how the first test after E is within its range.....

Just an update. Full Discloser: this was not a trade taken due to time of day, simple a trade called in the prior post. Remember: How you manage a trade is up to you. But at this point a good 30 pips could be realized. @ $10.00 a pip, that’s $300.00 per contract.

Thank you for the reply but I must respectfully disagree. Hopefully we can start a nice debate on this subject for all to learn from. There are two main reasons why I disagree: 1. Post clarity. I think it is easier to see the bar in question in my chart than in Hal's chart. A reader should not have to struggle to see the individual bars unless the post is more "grandiose" in scope. Also the chart goes back enough to show the Supply line to the left which is important, but only in looking at that Effort bar. 2. This is the real reason and gets to my belief system with regards to the markets and especially VSA. I believe VSA is about the NOW MOMENT. This moment is defined by activity of the professional players. Said activity is seen thru VOLUME. When the BBs are active, they leave foot prints in the market. These foot prints are first in volume and second in range and third in close (within that range on that particular volume). Therefore, One wants to begin analysis when the volume spikes up. An ultra high volume bar is the NOW moment. What happens before matters to be sure, but when the elephants leave a huge foot print, its time to pay attention. As I stated, Point E, although Hindsight, is the best entry for me. Why? Because price has moved down on ultra high volume (A). It then moves thru this area and falls back into it. But now on this fall back in, there is no volume. If the volume bar at A was selling, we now see little selling as price enters this range again. This is bullish. This area does not seem to be bring in traders off the sides lines (that are bearish). If the volume was buying, this is still bullish because the buyers are looking to see if a return to the area (range) brings out new bears. Again, I missed this point in real time. But my point now is this: regardless of what is on the chart 6 hours ago, 6 days ago or 6 months ago, we need to focus on the NOW and the high volume bar at A is the now. I have attached a chart from the start of today's market. While this is not an ideal time to be trading, there is a nice set up here for a short trade. Only what is presently seen in the chart is needed to make this trade. How much more do you need? A: Not a real important bar, especially at this time. This is an effort o fall bar. Of course volume is low. B: Tricky bar. Narrow range up bar closing near its high, but making a lower low on volume less than the previous two bars. First note that this bar is within the range of our Effort to Fall bar. This bar is a test, it looks like a No demand type of bar because it closes up. However it is a test. The bar opens and price is ramped down (making a slightly lower low) and move all the way back up closing higher than the open and near the top of its range. Not an entry signal for me. C: This proves that the previous bar was a test. This is an Effort to Rise bar. If we look to the left, we see a small supply line and yesterday's high. This bar is pushing thru these areas. This is our first NOW point. Look at the volume. Something is happening on this bar. For whatever reasons, the BBs are become active. If the BBs are active, we want to get active. Not before. D: Our second NOW point. Very high volume on an down bar that makes a higher high and closes near the bottom of its range on a wide spread. This is an Up thrust or thrust type of bar. This bar speaks of market weakness. E: NR7 up bar on volume less than the previous two bars after weakness: No Demand. And where are we? Within the body of the ultra high volume bar-the effort to rise bar.

Read any of Eiger's posts for this one.

First, we must admit that times have changed. In Wyckoff's and Tom's day, every market had market makers. Today is a different story with electronic trading. Where there were once floor traders, there are now streams of data in cyber-space. With that said, the principles remain the same. According to VSA bearish market makers would do this: 1. first we understand that they are bearish becuase they can see both sides of the market. And the market players. If they are bearish, therefore, it is because they see a large number of sell orders from the players in the know. 2. Price is allowed to rise slightly as the buyers (the people ultimately on the wrong side) enter the market. 3. The range is kept artificially narrow. The herd (buyers) thus think they are getting a good fill. In reality, however, they are buying into a "flood" of smart money selling. In other words, the presence of a lot of supply, allows the market maker to match the orders easily and keep the range small. Econ 101 would tell us that a lot of buyers (high volume) would bid the price up. What is really happening is that the buyers are buying into a lot of selling (supply). The smart money will have more supply than the herd. So ultimately price will fall on the abundance of supply in the market. But you would at some point see that narrow range up bar on high volume......... This is the type of bar Bill Williams called a squat. Tom calls such a bar "end of a rising market", when it is into new territory and closes in the middle or high of the bar.

Hello. Threads kind of' slow. Hopefully this post will generate some helpful discussion............. Q: Where do you vsa experts and newbies see an entry into this very nice up trend in the Euro from Friday? Please feel free to use the chart on the left to annotate what you see and where you would of entered and why. The chart on the right shows various things that I see/saw and where my entries are/were. I do not try and pick tops and bottoms, I let them pick themselves. However, much was "given" away by not entering sooner. What did I miss? A: It all starts here. A wide spread down bar on ultra high volume. Notice that the close is near the low and the next bar is down. We know that strength, when it appears, appears on down bars with high volume. But the next bar is usually up. That is not the case here. Could this be a weak bar? B: If you were not sure of bar A, then this bar only adds to the confusion. It is a narrow range up bar on volume less than the previous two bars. It is no demand. Note that the close is in the lower third of the range and the bar is a NR4 bar. NR4 being the lowest range bar of the last 4 bars. The smart money doesn't seem interested in higher prices. C: Things get more muddled. We now see a narrow range down bar on volume less than the previous two bars. No supply. If one wants to argue that it is not no supply because of the background, then it is still a low volume down bar showing no interest by the smart money. But that means we have no interest in the upside OR the downside as both the up bars on low volume and the down bars also. The only clue for me is that the volume on C is less than the volume on B, indicating even less desire for downside action than the upside. D: This is a "key" bar. For some it is a "key reversal" bar. We have a wider range than the previous bar, the bar makes a lower low, closes in the upper portion of its range, closes higher, and has increased volume. This might be stopping volume? If you enter here, please tell me why (and more power to you). E: At this point, the market has began to move up and we are looking for a test to enter. The previous bar gets stalled and price falls. This bar is narrow and has volume less than the previous two bars. In highnsight, this is the ideal entry bar as it is a low volume bar within the range of a high volume bar (A). But the next three bars close lower than E. Actually the third bar closes back even with E. F: Pushing thru supply. Wide spread up bar on high volume closing near its high on equal volume. This bar is also an Effort to Rise. The BBs are bullish and they are willing to absorb selling at the supply line in anticipation of higher prices. Sometimes the BBs will buy at high prices because they know they can sell at even higher prices. G: Low volume up bar. By definition it is no demand. But we know that there is too much evidence of strength in the background. It is more likely that the BBs have let off the gas and now want to see a test before marking prices any higher. H: No selling pressure. We see an increasing range bar closing near its lows on volume less than the previous two bars. This is not a test as a test bar would be narrow and close on or near the highs. Those at the head of the class may of used this bar to signal entry and confirm that F was pushing thru supply. I: This is a two bar reversal pattern. The first bar closes near it low and the next bar closes near its high. Notice the volume on the bar that closes higher. It picks up. Whilst VSA does not look at the open, notice that the first bar opens near the high and closes near the low. The next bar opens near the low (lower than close of first bar) and closes near the high (higher than the close of first bar and equal to the open of the first bar). J: No Supply. This confirms the two bar reversal as the prior bar looks like a failed test, signaling some residual weakness. I would rather see low volume bar within the range of prior high volume bars. J does trade into the range of the second bar in the two bar pattern, but is not completely within it. K: No Supply. This is just showing another Effort to rise bar followed by no supply bar. This is that high volume bar with a low volume bar within its range idea. So in an area (range) where there was an abundance of activity the first time, there is little activity when price dips back into it. This is bullish. L: As the market begins to top out, we get another narrow range down bar on volume less than the previous two bars. No Supply. The real key is on the next bar. It is an Effort to Rise with no result. Effort without result would be bearish in this case.

Basically, that type of bar means : Open=High=Low=Close. The spread, or range, of the bar is zero. These usually appear with little volume. This makes sense as volume is activity and there is a relationship between volume (activity) and range. As far as being no demands or no supply, it gets a little hazy. If the volume is less than the previous two bars on such a narrow spread and closing up, then you have the base definition of No Demand. This is the definition that is in the MTM book. Unfortunately people were simply trying to short on any No Demand. Tom then had to "change" the definition to stress the idea of background weakness (or strength in the case of no supply). Hence, many now would say they are just low volume up bars showing little professional activity in the market. Considering that 80-90% of the volume "figure" is professional money. Tom and Todd used to talk about "a polar bear" in Hawaii, when a no demand showed up in the wrong place. Like when there is not weakness in the background. They used that term because the bar met the base definition (book) of no demand. What people seemed not to grasp was that all up bars on a narrow range with volume less than the previous two bars are no demand, but not all no demand bars are tradable. As you are just starting out, you should put the bars into context. If there are no signs of weakness behind you, then look at the bars as simply low volume up bars showing little professional activity. If there are signs of weakness (like high volume up bars closing off the high with the next bar down) then look at the bars as no demand. Which still means there is little professional interest in upside prices, but now you have the background context for a tradable bar. Sorry for the lengthy answer but this is a pet peeve of mine. In order to appease critics and traders that did not understand the idea of context and for software purposes the definition was "changed".

I would have to disagree with this BlowFish. Any definition of price action trading would take into account the use of price and possibly volume in the 1st order. In other words price and volume in and of themselves. MA's, RSIs and other indicators are 2nd order as they are derivatives of price. Take a look at the below chart. Can anyone using this chart truly be considered a price action trader? This method uses Momentum and momentum is a 2nd order derivate of price (and time). Even the pivot points (green lines) are defined by changes in momentum and not price itself. Although they do a good job of visually accentuating these price points, they are a function of price and not price itself. Thus can one accurately say they are based on Price Action? True price action traders don't have 15 different indicators on their charts. Price action trading is about getting closer to price, not further way from it. Indicators move you further away.

I like this chart. The song remains the same. Why shouldn't it? Repeating patterns are good from a trader's point of view. A: Ultra high volume bars are always a good place to start. These are the type of bars that signal professional involvement or activity. Notice that we have a green bar on ultra high volume that closes on its highs. It does not close down, although it makes a lower low, it closes equal to the previous bar. Clearly, buying had to occur within this bar. How else could we have a wide spread ultra high volume bar that closes on its highs with the next bar up? VSA does not look at the open, but take a look anyway. Based on where the open is, we know that the market went down and then was moved up and closed higher than the open. The bulls were in charge at the end of the period. This paint bar follows another paint bar thus creating a balance area. Thus we now have a location (area) within which we would be looking for signals. We can conclude that strength has entered the market and thus we would be want to get long. B: Blue paint bar that is also a buying bar. The next bar trades higher than the high of the paint bar. This tells us there is some price acceptance of these higher prices. Another sign of strength in the market. While this next bar is a low volume up bar (hence the diamond), we like the fact that it makes a higher high than our blue buying bar. C: This is the antithesis of the action at B. Price has fallen slightly from the high of the bar proceeding B and now we have another blue paint bar. This one, however, is a selling paint bar. But look at the close, the close is in the middle portion of the bar and closing higher than the previous bar. Also note that there is no action below this bars low on the very next bar. Here again we see strength as there is a rejection of lower prices as seen by no follow thru on the next bar to the downside. But we are not yet in this market on the long side. We are looking for a nice Test bar. D: Decreasing range on an up bar that makes a higher high and closes on or near its low on volume less than the previous two bars. This is an Up Thrust in the form of No Demand. Not a reason to get short, but a sign that the market is not yet ready to head north. This is good cause we are not in it yet. We recognize the strength (demand) in the background so we are not in the least bit tempted to take a short trade. E: This blue paint bar completes a small balance area that is not shown. No matter. The real point here is that we get another selling paint bar with no follow thru on the next bar. One more clue that the market's bias is for higher prices. E takes us back into the balance area and we would now be expecting to see a Test (of supply). F: The bar we have been waiting for. A narrow range down bar closing on its high with volume less than the previous two bars. Not only is it within the range of the balance area, but it is roughly at the midpoint of the area. Price dips below the midpoint and move back above and is immediately tested. The BBs don't find anymore supply down below so the path of least resistance is to the upside. Hitch a ride on their train........

You wont find them in any book (yet). Tom once referred to them as Gavin's trigger number, with the emphasis on Gavin. Indicating to me that they are not strictly VSA. Gavin has spoken about them a couple of times but many more times he refuses to say much about them. Basically he draws a horizontal line at the close of certain high volume bars. These lines tend to act as support/resistance areas or areas where valid signals show up. Hence the name trigger. The point I was showing was a defacto method of creating a trigger number, which very often makes for better support/resistance than plain vanilla floor pivots. The one I show is used because it: (1) has ultra high volume (2) is a buying bar with no immediate follow thru (or selling bar as I am not looking at the chart as I write this) (3) is not part of a balance area. Simply one could look for an ultra high volume bar that forms a swing high or low ........

It's all about your needs. If you simply want to look at bars and volume, then most any package will do. If you want to paint you volume bars according like TG does or other on this forum do, then you will need to know a programming language. Or hope the code is available for free here or on the net. The ideas and you want to incorporate into your charts, will dictate how complex of a software package you need. But the basics: bars/candles and volume are found in most all them. *** one thing that I would mention: Not all packages have HLC bars, these bars are different than OHLC bars as they have no hash for the open. Strict VSA does not look at the open. If you intend to look at the open anyway, than it is not a problem. But if you don't, might as well remove it all together. ***

Here's another chart for you viewing pleasure. There's a few things that are really interesting here. First, what we can't see on the left of the chart is the fact that we are in a down trend at this time. This information is obviously important as most traders would want to be shorting in a down trend and going long in an uptrend (more on this later). Note the pink paint bar on the left side of the chart. This bar has ultra high volume with a close off the lows and the next bar up. VSA tells us this type of bar shows buying (strength) by the BBs. Also note that this bar is a "selling" bar since it has a lower low than the previous bar but not a higher high. Once again, we need to use second level thinking and realize that this is a bar of strength despite what the masses are oft to think. What we can do here is use Gavin's trigger number concept. A yellow line was placed at the close of the bar and drawn into the future. This level, or number, should be an area where price will react in the future. As noted, the trend was down at this time and the high volume that entered moved the market to the sideways a bit, but there was no demand for higher prices at this time. Note the blue paint bar (Effort to Fall) that shoots thru the yellow line and below the low of the pink paint bar. The next bar is a narrow range up bar on volume less than the previous two: No Demand. Although it is not marked, this is a good place to take a trade or add on whichever the case may be. Things get interesting later on. Note that a Balance Area forms where there are two successive blue paint bars. Because the low is made before the high, we know that this balance area was made by buyers. Looking closer at the first bar of the balance area, we note that the close is in the upper portion of the bar on a down bar on increasing volume. Buyers have to be stepping in here or the close would be lower on the bar. This is the spread analysis of volume spread analysis (LOL). For the aggressive counter trend/scalper type of trader a long sets up as we see a no supply bar that trades down to the midpoint of the balance area. With the blue paint bar, two bars earlier showing some price acceptance to the downside we know the market is ultimately still weak. Any pop in prices is expected to be short lived when we couple this with the actual direction of the trend. The really interesting thing is what happens as price pops higher. Price hits a resistance point and bounces. The resistance point is the yellow line, our trigger number. Gavin would say, "There are no accidents". As price bounces off this level we see a narrow range up bar on volume less than the previous two bars followed by a down bar that makes a higher high on increased volume. This is an up thrust. BINGO We see what we want to see and in the location we want to see it. Time to get short. This trade is in harmony with the market. The real take away here is, if you can define ultra high volume bars you can use these to create your trigger number (support/resistance lines).

A very interesting trade set up here. This is another 1 minute Euro example. Let's start by looking at the left of the chart. Where else ? In trading we are always looking left to trade right. At least we should be. One of the best signals to start your analysis from is some type of Climatic Action bar. We see a green paintbar that is indeed a Climatic Action bar. It has a wide spread on high volume closing off its highs with the next bar down. Once again, we know that when weakness (supply) appears it appears on UP bars. So while this is an up bar and "buying" bar, we know that the volume tells us that this bar is weak not strong. The BBs are selling into the move. Take a quick glance to the right, and note how the market moves sideways after the appearance of this high volume bar. While we do not know this now at the time of the bar, this sideways motion is further signal of supply (weakness) entering the market. The very next bar is no supply. Like the no demands in the previous post, the location makes it suspect. Moving 4 bars to the right, we see a blue paintbar that is also a buying bar. The very next bar trades higher than the high of our buying bar showing some residual strength in the market. But we don't want to get long. The market meanders sideways for awhile showing various "deceleration" sings, that is, no demands and no supplies/tests. With the background weakness, we are not looking to take the no supplies/tests. With the evidence of some residual strength, we don't want to take no demands. More over, notice that the no demands are not ideal. The second one, for example, makes a lower low and not a higher high. That is, it is a Selling bar. We would rather it be a buying bar. Finally, we get a better no demand after price has risen from a test. Notice that this no demand is narrow. It does not make a higher high, but does close on its high (which is equal to the previous bar). At any rate, we have a narrow range up bar closing on it highs with volume less than the previous bars. More over, the next bar is down and an Up Thrust. Up Thrusts often follow directly after no demands. This sets up an aggressive entry to the short side. I think it is aggressive as we have seen some residual strength in the market after the initial sign of weakness. Moving two bars to the right, we see another no demand. This no demand sets up another aggressive entry. What is key here is the confirmation bar. The very next bar which confirms the no demand, turns out to be a paintbar and a balance area. More importantly, however, it is a selling bar that is confirmed with price trading lower than the low on the very next bar. This counter acts the prior buying paint bar and now we are convinced of the market weakness. Not to mention that this bar is an effort to fall. In order to get short we would like price to move back into the area of our Effort to Fall bar (in this case balance area). Price moves down and then moves back up. We than get a no demand bar that is narrow, closing on its highs, and a buying bar. Our ideal entry comes a few bars later in the form of an Up Thrust. Note how the bar makes a higher high but closes on its lows and down from the previous bar. This is a text book example of market "manipulation". Once again we see an example of a Buying bar that is actually weakness (supply). What is key about this chart is the residual strength, as shown by the buying paint bar followed by prices trading above it; is eventually countermanded by a selling paint bar followed by prices trading below its low. Some may ask, why not short the no demand. Notice that the market does not trade below the low of that no demand before it forms the Up Thrust. In other words, if you placed a sell order below the no demand, it would not of been hit. In addition, the no demand followed by the up thrust is one of the 3 main set ups.

Haven't posted in a while is solidarity with CW over his treatment here, but I attended the webinar today and decided to post at least twice more........... The below chart shows many VSA principles and ideas that it offers a great opportunity to learn from. One thing I would not first, is that this is a 1 minute chart. I consider this a "scalp" trade. Due to the timeframe, not the length of time the trade is held or the amount of pips of the trade. Tom is not a fan of the 1 minute timeframe. Beginners should just be aware of this point. A: There are a few things that are of note on this bar. First, it is a wide spread down bar closing off its lows on high volume with the next bar up. We know that strength, when it appears, appears on down bars. If that bar was weakness and all the volume represented selling, why would the next bar be up? Also note that this green paintbar is a "selling bar". That is, it makes a lower low than the previous bar but not a higher high than the previous bar. But check out the very next bar. This bar fails to trade lower. In other words, lower prices have been rejected-a sign of strength. This is bar forms the basis of our background, but there's more...... B: This bar is mentioned as it trips up many traders. It is a narrow range up bar on volume less than the previous two bars with the next bar down. Simply, it is no demand. More correctly, it is no demand by definition, but its placement is suspect. We have just seen a major sign of strength in the background and now we see this bar. It has to be ignored in this location. C: More information here. We see a down bar on increased volume closing in the upper third of its range. While this bar closes lower than the previous bar it still is closing closer to its high than its low. When know strength comes in on down bars when it shows up, and the close relative to the range tells us that the bulls were in charge at the end of the period. Yet again we have a "selling" paintbar that fails to have price trade lower on the very next bar. This is more background information of the strength/changing strength of the market. D: Beautiful example of what we want to see when we want to see no demand. It is a narrow range bar on volume less than the previous two bars and closing on its high with the next bar down. Again, as far as definitions go, it is no demand, but we have far too much strength in the background to consider this a tradable signal. E: Something has changed. At point E we get a bullish UP bar. When weakness appears it appears on up bars. However, not all up bars are weak. Here we have increased volume (but still relatively low) and a close in the upper portion of the bar, with an increasing range. This bar is also a "buying" paintbar. As it has a higher high than the previous bar and not a lower low. Take a look at the next bar, it does close down but It makes a higher high than our buying paintbar at E. This shows some acceptance of higher prices in the market. In short, we have another sign of strength. F: This is the market hitting us with a 2x4. We have a wide spread bar on ultra high volume known as a shake out. Again, note the close relative to the low of the bar. We are pips away from the high and miles away from the low. The BBs think on more than just the 1st level. 1st level thinking says, this is a selling bar on ultra high volume so the market must be weak. In reality, we know that the close near the high on this bar (and with the next bar up) means this bar is strong. The BBs have gunned for some stops of the early longs and tried to "freeze" out those on the sidelines. For some that got short on the low volume bars (no demand), they may be convinced to stay in the market on the short side and thus be forced to buy the position back at HIGHER prices. Those that can read a chart, have seen the elephant's foot prints and get can get long on the next bar 1 tic/pip above the high of the shake out.

I was wondering what took you guys so long to get here. LOL good luck with your thread.

B.F., As I have tried to place DbPheonix on ignore more than once, I know you can not do so to a moderator. That is the first thing that should be changed.

Whilst No Demands come in different intensities, you would want to be looking to short (sell) not buy after a No Demand (ND). With No Supply, you would want to be looking to go long (buy) not sell after. One way to make them more "powerful" is to look for only those that are at least NR4 bars. That is, that have a range less than the previous 3 bars. The best ones are also going to be Dunnigan bars: for No Demand-make higher high than previous bar but not a lower low. For No Supply-make a lower low but not a higher high. The next ideal would be an inside bar. Also if you want to clean up your chart, you can choose to only place signals on those that confirm. No Demands that have the next bar down and No Supply/tests that have the next bar up. From a trading standpoint you could still choose to enter when the low is breached for ND and when the High is breached for NS/Test. Hope this helps.

Before I get to the ND in question, some background. The technical definition of No Demand is a narrow range up bar on volume less than the previous two bars. This is the MTM book definition as defined by Tom himself. Note in the definition no mention of the next bar being down nor "weakness" in the background are included. A problem arises with the definition and Tom has begun to address it. The problem is that these signs come in varying degrees of strength (or weakness as the case may be). Some people were mistakenly trying to short on any up bar with volume less than the previous two. This is a recipe for disaster. Thus Tom has begun to emphasize the background. But if you look at the definition, a no demand bar is a no demand bar regardless of background. IT IS, HOWEVER, THE BACKGROUND THAT MAKES IT TRADABLE. Speaking of background, we can now look at the no demand in the chart. What can not be seen is that the trend was down on a 1 hour (60 min) chart. If you were looking at this 3 min chart at the time you would see that we were in down to sideways trend at the time in question. Therefore, momentum and supply over whelmed the demand of those two high volume bars. As for who Shapiro is, I do not know. I believe it was the term used by Larry Pesovesto (SP?) to describe the notion that if a trade is good now, it should still be good in 5 minutes from now. Check out the Market Stats thread for a more exact/better definition.

Having issues with ensign so here is a 5 min chart from a different software. The focus of this chart is the same as the prior chart (Euro 3 min.). The set-up here is very nice and worth looking at further. A: Narrow range (NR7) bar closing down on volume less than the previous two bars closing near its highs. This is a test. Great example of a test as it closes lower and makes lower low. A test is a sign of strength, but we must see what happens after. In other words, the test is a "cause" and we now must look to see "effect". B: 2 Bar reversal pattern. Sign of weakness after our test. This is a very nice example as the second bar makes a lower low, closes near its lows and does not make a higher high. We would actually like to see the close of the first bar closer to the high for a text book example. In fact, the next 2 bar is more text book although it fails to produce. Note that the second bar closes lower than the close of the test bar. C: Wide Spread up bar closing near its lows on high volume with weakness in the back ground: this is an Up Thrust. Again, we get a higher high and not a lower low as the spread widens from the previous bar. Prices are rapidly marked up only to fall and close near the lows. Possible entry for the super aggressive type. D: Note where we are- we have drifted up into the area of the 2 Bar Reversal. With these reversal patterns, we like to see them tested/ or find no demand within the area of said pattern. We see a narrow range (NR4) up bar on volume less than the previous two bars. This particular no demand bar makes a higher high but not a lower low which is ideal. We can enter short on a break of the low of this bar. E: The market moves down and then drifts back up, where we see another narrow range (NR4) up bar on volume less than the previous two bars. No Demand. Again, note that this appears within the range of the 2 bar reversal pattern. The stage is set. We have weakness in the background. Starting off with No results from a test (we have the cause but no effect). A 2 bar reversal pattern shows further weakness. Just for good measure, we see an Up Thrust in the correct place showing us even more weakness. For entry we like to see a No demand- we get two. Just to finish off the thought on the 2 bar reversal. Take a look at the second one . It is immediately followed by a third 2 bar reversal, this one a bullish pattern. This countermands the previous pattern. Now take a look at the bar labeled No Supply. This bar is within the range of the third (bullish) reversal pattern. As we move forward , we do not see a No Demand type bar within the area of the second pattern. Thus, although the second pattern is the most ideal in look, it is the one that fails. In fact, notice that we see tests that fall within the range of this pattern. Since this was a bearish pattern, we would not want to see test, but rather no demand. Test would prove to be bullish and thus nullify the bearish reversal pattern.

For those who attended the stellar TG event today. This is a quick chart of what the 3 min Euro looked liked when I told Gavin it was ready. By the time he entered, he had missed most of the move however. The two key bars are the no demand (Blue bar with ND above it) and the next bar which is a failed test. The very next bar after these two bars, trades lower than the lows of said bars. By trading lower than the test bar it shows the test has failed. By trading lower than the ND we have a "Shapiro Effect" type entry.

I don't know them as I trade Forex and thus have different settings. I will, however, help you if I can. How do you have your price histogram set currently?