Vercingetorix

For futures like the s&p 500 e-mini what trading hours do you use? Do you use the 9:30-4:00 stock market time range or a 24 hour chart?

I look at volume relative to the average volume just by eye balling it.I will usually look at the volume of buying/selling climaxes the stock has had in the past and compare it to the current activity. On occasion I also like to look at the float and shares outstanding. The key is to remember to think relative when looking at volume. There's no standard metric when to determine "alot" of selling/buying is occurring; you just have to judge it based on the particular stock. You are correct about the large volume showing a transfer of stock. Stocks generally go through a cycle of accumulation (noobs dumping their shares to pros at low prices) mark up (prices rise as all the weak hands have been shaken out and the stock is backed by professional money who will support the stock) distribution (stock is dumped back to the noobs). Using VSA to see these patterns is incredibly powerful. Now obviously it's not always cut and dry because there are many participants in the market and it is not demarcated strictly between pros and newbies. I think of it more as a gradient with the true amateurs on one end and the true pros on the other end. Fund managers can be anywhere in that gradient and are often just as bad as the amateurs at home mind you. Also, although we speak of "professional money" this is a little bit misleading because it is used in the singular. In reality there are going to be a number of professionals working in a stock and they generally, although not always, move in the same direction. I say generally, because there are periods of consolidation which appear to be a battle between pros trying to take the stock one way and another. If you look at bidu from July 9 to September 10 (roughly) there is such a 'battle'. There is significant activity at the 210 price level which is where the conflict between those wanting to take the stock higher and those wanting to take it lower occurs. The bulls finally break through mid September handing the bears their arse on a platter. I think this why prices rose so quickly after the breakout because all bears short at 210 were held by the balls and forced to cover at higher prices. I do not think it is hard to imagine that professionals often screw other professionals in this way. Remember, there is nothing sinister going on here. There is no collusion between pros. Everybody is trying to make money at the expense of someone else. The markets are a brutal take-no-prisoners game and I love it .

Here's an update for BIDU for those that are interested. On the first day we have a up bar on high volume closing near the lows. This is selling for sure. The next arrow we have a high volume up bar closing on the highs, with the next bar down showing hidden selling in the previous bar. On the third arrow we have a up bar on massive volume followed by a down bar, this is also hidden selling. If this isn't a buying climax I don't know what is. To give you an idea of the large transfer of stock that's going on the outstanding number of shares is 34 million shares. The news about the stock is also very rosy. I couldn't find anything negative about it, one video covering the stock said it was still cheap lol... I don't know how someone can say that a stock that's doubled in 5 weeks is still cheap.

I think we might have possible buying climax in Bidu. The stock has moved rapidly (50 points in 4 days) on heavy volume. Today we had an up day that closed well off its highs on very high volume. Longer term I don't know where the stock is headed, but limited upside from here I would say.

Not to blow smoke up my own arse here, but once again vsa proves of great use.

I think we're going to get another wave down to shake any early longs out and suck some new shorts in. The weak volume rally is what is telling me that this recent move up is not the real thing. We'll form either a head and shoulders or double bottom and then rally to new highs. I'm of the persuasion that this is a correction and not the start of a bear market. The reason is simply the amount pessimism is too great for this to be a bear market. Bear markets don't happen when everyone expects one. Also the price action during this correction looks bullish from a vsa perspective so I would say that the pros are buying this correction like they did the last one in march.

What do you mean by foresight analysis? Calling out trades using VSA in real time? I posted some charts of some swing positions I took using VSA in this thread: http://www.traderslaboratory.com/forums/30/vsa-chart-day-1476-new-post.html Earlier in this thread I was bullish on the stock indexes using VSA a month ago: http://www.traderslaboratory.com/forums/8042-post58.html

Here is another earnings play I took today (bought the may 125 put for 3.00 this morning) of a company reporting after the close. 1) We have a classic selling climax pattern here. We have an ultra wide ultra high volume up day. The next day is a down bar with high volume indicating that there was hidden selling in the previous bar. 2) Here we have stopping action. The volume is lower than the selling climax which leads me to believe that this alone is not accumulation for a significant move higher. It may have been short covering or buying for a 'mini-campaign'. 3) I consider this box to be action indicative of what I call a "mini" campaign. A full blown campaign would be the accumulation of a large quantity of stock and then marking it up significantly before distributing it to the public. This is the same idea except on a smaller scale... This idea of a miniature campaign isn't a vsa concept but it is something I've noticed on some charts. Anyway we get an upthrust before moving lower. We test for supply and than move up. There is a no demand pattern followed by a test. I point this out because I've noticed that many times during a markup of a stock that it follows this pattern of no demand followed by a test before moving higher. The next three bars are healthy up bars on good volume closing near the high. 4) The "mini" campaign I just mentioned was a bull move, but I think it was a smaller bull move in what will be a bigger bear move. This is an upthrust bar into new all-time highs which I expect to precede a bigger bear move in the stock. The bar occurred on high volume which is "extra bearish"

I found one stock that interests me. 1) These two bars are wide, ultra-high volume down bars. The first closes in the middle of its range and the second on its high. These would represent buying... the only problem is I don't know their proper VSA name. I'm tempted to say selling climax, but I think that only refers to bars like these that occur in recent new low territory. I'm going to have to consult the book... 2) These look like test bars for supply. The stock is a bio-tech stock reporting earnings today after the close. Bio-techs are excellent candidates for black-swan events (new drugs, fda approval, buyout, acquisition, etc). Even so it's a high-risk, low-probability play.

I have no way of scanning for specific VSA patterns since the software I use (quotetracker) doesn't have any chart scanning abilities, although if you were able to program such a thing in another charting package I would be interested. I ran across BIDU because it's been on my radar screen for some time since this is the third time I've played BIDU earnings, each time profitable. I'm running through some charts for companies reporting earnings next week. If I find anything good I'll post here. I've found that out of 50 earnings releases there might only be 2-3 worth playing; the rest are too much of a crap shoot because the chart is not clear. I know what you mean about thinking differently when it comes to VSA. VSA is still a new concept to me and before I would rely heavily on moving averages and MACD/RSI divergences. I still throw those indicators up on a chart sometimes because they're like having a crutch. A chart with nothing but price and volume can seem intimidating.

Thanks Flatwallet. I bought some May 125 calls for 0.45 last Thursday. They're currently worth 7.5, but I think I'll let them go by the end of the day. By far my best trade in 18 months of playing earnings. These are once a year type plays.

Yes, that was a no supply day. If you look at the volume you can see that the weeks before today the liquidity in the stock really dried up, allowing for the stock to rise 30+ points in 3 days (counting today's after hours action). It will be interesting to watch the action tomorrow to see what the professionals will do. I think that they will gap the stock up above 134 to put it in new 52-week high area which would put all all shorts in the red, from there they'll either distribute or hold on to the stock and let it run.

Follow up on BIDU. The markup process has begun. BIDU releases earnings after the close. This should be interesting, let's see if VSA can predict what the stock will do after 'news' is released (I've usually found that the direction a stock will be taken is determined before the earnings ever hit the wire). edit: It's 134 after hours. How sweet is that.

Is there a recording that can be downloaded? Thanks.

I must have misread the instructions. I see how it works now. Thanks for the reply.