jjthetrader

An example for Monad (who's looking for entries) and Tawe Trader. We have weakness on the open this morning (ES). VHigh Volume up bars on narrow spread. Point A - we get an upthrust. So we want to make a trade like Tawe and wait for the low to break. B - it breaks, now look for the entry. I set mine at the Pivot. C - my order gets filled and I get my 1 point scalp right away. But for longer term traders look what bar follows point C. It's a stop catcher and it would have got mine if I was still in. This illustration is to show what one has to be cautious of when trading these setups. If you're not scalping give your stops some breathing room.

You've got balls of steel my friend! Making a trade like that takes big ones. Price just blew up through R1 and you've got the confidence that it's going to blow right back under. I see it drifted sideways for a while and that shows even more trading skills, to be able to stay the course. Nice work, love seeing the real time trades. You inspire everyone here to trust in what you know and see and go for it. cheers mate.

Right on! Now this is what I like to see! Thanks for contributing.

1. Some "signals" appear right away and others take 2-3 bars to develop but this is VSA, confirmation is needed on a lot of them, PP was right on that. It's a multi-bar formation. For example, a test won't signal in TG unless the next bar is up even though you see a low volume down bar closing on the high. 2. Customer training now blows. There is no Todd so the only one left for teaching is the head of marketing. I was at 2 events this week and the trades made were blunders based on trends only but not VSA. 3. I have never taken a trade based on the TG signals, this would be foolish. It'll fire off a no demand even when there is strength in the background just because the bar meets the criteria of a no demand bar. But with strength in the background this is what they call a polar bear in hawaii, it doesn't belong. 4. I do get by effectively at this point without it's signals. I turn them on most of the time so the program will signal me that something has occured on a different timeframe chart then the one I happen to be looking at. I have to admit it is nice to get the confirmation that what you're seeing is in fact what you thought. It's reassurance and that gives you a bit of confidence. TG has a lot more features than just VSA as well that I love. Trend clusters (wouldn't trade without them), Auto Pivots, relative volume bands etc. I find it visually appealing, easy to use and an overall good charting package even without VSA. Am I happy that I'm currently paying off $2,000 for it? Yes. If I look at what it's taught me and given me it's worth that and then some. Look at what the guys at trade the markets sell their seminars for. I look at it as education. For those that know how to use google and search places they're not supposed to surf you'd be able to obtain a working copy of the RT version to try it out but I would not endorse this.

LOL! You won't find any discounts for it. In fact they've raised their prices because of the dollar.

I like it. I've just gone back and looked at it on a 512 tick. What I'd like to see is some background weakness/strength come in using VSA and then narrow my entry and direction down with this. I personally like scalping, quick and dirty. What do you do if the second bar doesn't come up to touch the 5ema? Not take the trade and wait for the next setup? cheers

Yes, a lot of people on this thread are. If you read through you will find quite a few comments on it. I personally use it and love it. What an aid it was/is in getting up to speed on VSA. You'll find other that will tell you you don't need it and this is true to. It's just way easier at first when you see something forming to get the confirmation from the software and being able to read the comentary of what to watch out for.

Yes, I was just wondering if you had an automated strategy in TS which was backtested. When you exit on the low/high of the 3rd bar, how do you know it's the low/high of that bar or do you have a target of 4 ticks or something?

Thank you for contributing to the thread. It's very interesting how different folks use MA's for trading. Have you created a strategy for this and backtested it?

My friend, what you are describing is a strategy. This is merely an indicator. However, I have worked out a nice little strategy from observing price action around the white diamonds if it's been in a consistent (6 bars) trend. For my strategy this indicator works best on a 2min chart and will scalp 1 point off the ES nicely. I set entry at the low of the bar creating the white diamond (if going long). Of course there's more to it than that but you get the idea of how a mechanical entry could be set by using an idea like this. It's similar to yours, waiting for a pullback. I do appreciate your post as I'm always interested in incorporating new things. Thank you.

Blu-Ray, I'm just trying to make your life difficult. But here's another condition for you that will explain some of the white diamond action. As you can see in the attached pic, point A should be "green" (mine are blue) because it's the 2nd close above the MA. But it closes below the previous bar which keeps the diamonds white. Then point B closes level to A which also keeps it white. If that would have closed up it would have been green. Then we see Point C is white as well because it closes below the MA after a close above it. But then look at the next bar. It's wide range up and goes straight to green (blue in my case) because of my MA envelope theory. So did I ruin your weekend thinking about programming this? lol

Yes there does appear to be more to it. There seems to be a condition of the closes closeness to the MA. It's almost like there's a very small MA envelope around the MA and until it breaks out of that the second close won't change from white. There's the added observation that if you're closing above the MA then you get a drastic close below, bypassing that "envelope", it will go straight from green to red and bypass white all together. I've posted a 5min chart of the ES with the diamonds on so if you guys would like to trouble shoot you can. I can post any chart you like with them on to test with.

I'm happy with the 2 points. I had that profit target setup before I was in the trade. Money in the bank is a good thing.

Thanks Ravin, Here's a continuation of my chart to show the potential of a setup like that, even though I only captured a miniscule amount. It made an 11 point down move, so far, from my entry point.

I was inspired by Tawe and thought I'd like myself a nice upthrust trade as well. This is a 5 min of the ES that just happened this morning. High Volume, Narrow Spread Up bars start out our day with a top reversal mixed in there. Then we get a beautiful upthrust. I set my order entry based on the stop I can afford above the high of the upthrust and bam! I'm in and out just like that. At $50 per point per contract that's enough for me:)

That was an excellent trade. There are usually a boat load of sell orders around the pivots which could have accounted for the upthrust but once you saw the close below it you were told it was more than that. Thanks for sharing the trade. It helps us all.

Hey, I was actually refering to the original posters questions about October 28, not Nov.28 which is the last bar on that chart. So on October 28th there appeared to be hidden selling and this would explain the drop off after that. The last bar on that chart doesn't appear to be selling. The bar before that could even be a test which would be bullish.

Upthrusts are tricky because they don't tend to travel alone.

Wonder if PP and others can help out here with VSA reading In the attached chart the market has risen over 100pts , this is a TG chart with VSA indicators, Now At "A", we have an upbar closing near middle on high vol, VSA signal indicates hidden selling. At "B" the indicator lights up a No Demand bar. and at "C", there is the upthrust All the elements appear to be in place, a substantial rise, hidden selling, no demand, sideways move indicating distribution and finally an "Upthrust", Question: Where and when if at all would one consider going short. and what would negate that ?"

I posted the chart to make it easier for others to comment on it. I see selling on both bars you inquired about. The 29th appears to be a no demand after that high volume up bar. If it where buying then the price would have continued up.

What exactly are we testing here? The August Volume? I'd like to see a little bounce then come back to test the down move (on high volume) that made it bounce.

It's even more beautiful if you took it. Did you? Nice example. I find using Candlesticks, like you guys do, helps you see WRB to the left a lot easier so you can see what trading range you're in, as in your example. I didn't want to leave your post here all lonely since you've been so kind as to comment on all mine:)

Blu-Ray, that's awesome! Thanks for coding it up for everyone. Crosses are what I preferred as well. TGuider also has an intermediary trending system. It's based on volatility bands. If you close above the bands your bars turn green, below the bands they turn red. You match this sytem up with your diamonds and you've got a clear trend direction. I haven't spent a lot of time trying to reproduce them because I do most of my trading now with TGuider and less with TrdeStation.

ranj, I found the test that contained that bar on the 5 min and it had low volume.

Everything in VSA is relative. Spread is relative. Volume is relative. What looks like low volume at one point in the day will look high at another. A moving average works well to know if you have low, average or high volume. So if Volume > Avg the = high, that type of thing. But like you said this is only a general classification to assist you. Same for spread. If Spread > Avg Spread then = wide spread. Use a short period for spread, a 15 and/or 30 for Volume.