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I don't want to toot my own horn but..........

 

CW, go ahead and toot your own horn as much as you wish :)

 

________________________________________________________________

 

FTSE March Future - 45 min chart

 

 

The mkt has been having a good rally and closed up again today, so that's six consecutive closes, most days on very light holiday volume.

 

As you can see there was an ultra high volume upthrust this afternoon, which to me, doesn't look too good and signals some possible weakness.

 

I am short the mkt and looking for at least a reasonable sized retracement / pullback in this rally.

 

Tawe

5aa70ea6a6c28_FTSE45m-Tues6Jan.jpg.96c4eca4a5200d55a71c0e002d9924a6.jpg

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a couple more showed up in my inbox today

 

WYCKOFF LAWS AND TESTS. By. Henry (Hank) Pruden

 

WYCKOFF'S BUYSELL TESTS APPLIED TO THE. MALAYSIAN STOCK MARKET DOW JONES INDEX Henry Pruden

WYCKOFF LAWS AND TESTS. By. Henry (Hank) Pruden.pdfFetching info...

WYCKOFF'S BUYSELL TESTS APPLIED TO THE. MALAYSIAN STOCK MARKET DOW JONES INDEX Henry Pruden.pdfFetching info...

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FTSE March Future - 45 min chart - UPDATE

 

After the mkt formed that weak looking ultra high volume upthrust on Tuesday afternoon after a fine six day rally and at the top of two up-channels, it did indeed fall back quite a bit.

 

I have closed out 85% of my short position at 11am this morning, just off the morning lows and near to the 50% Fib retracement level. There is, potentially, fairly major support just below, from an old mkt high.

 

It was also one hour before an interest statement was due from the Bank of England.

 

Tawe

5aa70ea70b79c_FTSE45m-Thurs8thJan.jpg.40e1f71aa06b799d744607c3a2beac12.jpg

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  tawe trader said:
FTSE March Future - 45 min chart - UPDATE

 

After the mkt formed that weak looking ultra high volume upthrust on Tuesday afternoon after a fine six day rally and at the top of two up-channels, it did indeed fall back quite a bit.

 

I have closed out 85% of my short position at 11am this morning, just off the morning lows and near to the 50% Fib retracement level. There is, potentially, fairly major support just below, from an old mkt high.

 

It was also one hour before an interest statement was due from the Bank of England.

 

Tawe

 

Very nice trade Tawe. You gave us all the heads up 2 days ago on that one. So much for not being able to call a VSA trade in real-time eh.

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  tawe trader said:
FTSE March Future - 45 min chart - UPDATE

 

After the mkt formed that weak looking ultra high volume upthrust on Tuesday afternoon after a fine six day rally and at the top of two up-channels, it did indeed fall back quite a bit.

 

I have closed out 85% of my short position at 11am this morning, just off the morning lows and near to the 50% Fib retracement level. There is, potentially, fairly major support just below, from an old mkt high.

 

It was also one hour before an interest statement was due from the Bank of England.

 

Tawe

 

From your charts, notice you only use 8a.m-4.30p.m data for Ftse and the various fib levels etc,

the market trades to 9p.m (London time), although volume tapers off but the price does follow the US markets.

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From your charts, notice you only use 8a.m-4.30p.m data for Ftse and the various fib levels etc,

the market trades to 9p.m (London time), although volume tapers off but the price does follow the US markets.

 

Yes, Hakuna I set nearly all my futures charts (various timeframes) to finish at 4.35pm around the FTSE100 cash mkt close. As I think I mentioned before, I believe the cash mkt hours, when UK shares are traded and future volume is at it's highest, is the most important time period.

 

I do take note of the futures evening chart, so I can see where it's been during the US session, highs and lows etc.

 

Here's a fine example in the 7 min chart I have attached below. It's today chart with yesterdays close at 4.35pm and my std floor pivots calculated from this close. The mkt bounced off this S1 level and if I'd set Sierracharts to calculate the pivots off the whole future session (last night 9pm close) then S1 was at a different level and didn't really have any effect.

 

This is only my own opinion but I've found the 8am to 4.35pm prices and volume are the ones to follow, work from and I end up with 'cleaner' charts.

 

I don't know if it was coincidence or whatever but todays S1 was at the same level as the 45min (multi-day) 50% Fib retracement level, where I exited a large portion of my short trade.

 

Regards

Tawe

5aa70ea72358b_FTSE7m-Thurs8thJan.jpg.01542b2886a5f96af6c76f7c58058e33.jpg

Edited by tawe trader
Wrong chart

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In the US we do the exact same thing as Tawe with our day session. Our levels are calculated from 9:30 - 4:15 for futures traders. The ES trades overnight but that doesn't impact our levels. The volume that trades between cash open to cash close is the most relevant for us.

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  VolumeJedi said:
TG webinar tonight at 1800 EST. Don't know how long it lasts, but the email says they will be trading the European open (forex) as well as the Asian session.

 

They're leaving the room open for 10 hours. It would be worth it if I could stay up cause Brad is an awesome trader but I just can't do it.

Enjoy it if you go.

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  VolumeJedi said:
TG webinar tonight at 1800 EST. Don't know how long it lasts, but the email says they will be trading the European open (forex) as well as the Asian session.

 

Sorry, start time is 830 pm (2030) EST.

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  jjthetrader said:
They're leaving the room open for 10 hours. It would be worth it if I could stay up cause Brad is an awesome trader but I just can't do it.

Enjoy it if you go.

 

as long as you log in within the first two hours, I think you could go to bed and then come back to it. LOL

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  SAM HOLLANDER said:
Anyone interested Tod Kreugers web site Traders Code is up.

 

Thanks, Sam. I know he's put a huge amount of work into that site. It'll be interesting to see what he's come up with.

 

Taz

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  SAM HOLLANDER said:
Anyone interested Tod Kreugers web site Traders Code is up.

 

IF I was a conspiracy theorist:

 

Phase 1: Somebody asks about Todd Krueger on the most visited VSA thread on the web.

 

Phase 2: An article appears on the number one forum by one Todd Krueger. Placed by someone who "doesn't recognize the name."

 

Phase 3: Todd's website goes live. The only links that are up are to courses...........

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  CandleWhisperer said:
IF I was a conspiracy theorist:

 

Phase 1: Somebody asks about Todd Krueger on the most visited VSA thread on the web.

 

Phase 2: An article appears on the number one forum by one Todd Krueger. Placed by someone who "doesn't recognize the name."

 

Phase 3: Todd's website goes live. The only links that are up are to courses...........

 

CW, if you WERE a conspiracy theorist, then your theories wouldn't hold water, at least not so far as I can tell. I guess I was the one who recently brought up his name, and I was rather proud of myself (for no good reason) that the responses I got led to an article (which I intend to study this weekend) and a link to his new website. I promise I have no connection to TK whatsoever.

Got to say I'm really disappointed in the website. Even his webinar contained no information at all. I signed up for his weekly freebie newsletter. We'll see if that's got anything in it or not. So far, however, Traderscode.com gets an F in my book.

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Hi,

 

I'm new to Traders Laboratory and also new to the VSA, however I'm trying to learn the approach for some time now.

 

I read the book Master the Market and have a question regarding the judgment of wether volume or spread is ultra high, high, normal, low, extremly low.

 

What should be used as a measure to judge volume and spread? For volume: compare it just to the last 2 days? Even if I do that, when should I consider it high vs. ultra high etc.? or is it better to compare vs. 30 day moving average. Also here arise the question which borders to apply for the different categories? Or appling quartiles?

Same problem applies to the evalution of the spread, when is narrow or very narrow?

 

How do you scope with this issue? What do you use?

 

Would be happy to learn from you!

Thanks

mcfotos

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mcfotos, Probably the best way is to look at charts until you get a feel for it. Look at the threads here and the Whycoff area too. There are some rules of thumb that seem to work OK. for example for 'low volume' Tom has advocated 'less than the previous two bars'. You can come up with your own rules of thumb if that helps you. Actually just thinking about that might help you to quantify and recognise things.

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  mcfotos said:

What should be used as a measure to judge volume and spread? For volume: compare it just to the last 2 days? Even if I do that, when should I consider it high vs. ultra high etc.? or is it better to compare vs. 30 day moving average.

 

For low volume (e.g., for No Demand and Tests) look for volume on the current bar to be less than the previous two bars as a useful rule of thumb.

 

For high - ultra high volume (e.g., for Stopping Volume, Selling Climaxes, Buying Climaxes, etc) look for high volume that clearly stands out on the chart. It should basically jump out at you quite clearly. You can also use a 20-bar simple moving average of the volume to help you see average volume.

 

A useful trick that you will see in many of the charts i have posted is to apply upper Bollinger Bands or a standard deviation application on the volume. Again, use the 20-bar SMA and 2 standard deviations from the mean (you can also add a 3 SDs band, as well).

 

Two Standard deviations captures 95% of all data within the 20 bar sample. Therefore, any volume bar that hits or exceeds the 2 SD threshold by definition is a fairly uncommon event (i.e., it falls within only 5% of the sample) and is therefore statistically significant and can be considered very high volume.

 

If you are a bit obsessive about these things, then the 3 SD (capturing 97.5% of the data) is even more uncommon and indicates a volume level that occurs only 2.5% of the time and is therefore ultra high.

 

The current spread should be compared to the last several bars. If you are looking at a Test or No Demand, the spread on the Test/No Demand should be compared with the spreads that lead to and include the climactic or stopping action. If you are looking at a reaction in an up trend, look at the spreads in the reaction and compare with the spreads in the impulse move (last up move) - reverse for a rally in a down trend.

 

Try not to make it any more complicated than it is. Study the spreads and volumes in the charts. With a little effort, you should be able to distinguish high volume from low volume and wide from narrow spreads. Keep in mind that both the spread and the volume are indications of activity.

 

If you have questions about the spreads or volumes in a chart, post it. People here will help you.

 

Hope this is useful,

 

Eiger

Edited by Eiger

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  Tasuki said:
CW, if you WERE a conspiracy theorist, then your theories wouldn't hold water, at least not so far as I can tell. I guess I was the one who recently brought up his name, and I was rather proud of myself (for no good reason) that the responses I got led to an article (which I intend to study this weekend) and a link to his new website. I promise I have no connection to TK whatsoever.

Got to say I'm really disappointed in the website. Even his webinar contained no information at all. I signed up for his weekly freebie newsletter. We'll see if that's got anything in it or not. So far, however, Traderscode.com gets an F in my book.

 

I am sure both you and BF are in no way connected to Todd. This was just a series of coincidences.

 

In truth, if I had a website on VSA/candle volume/Wyckoff volume I would want to have it discussed about here. After all, this thread has some of the best VSA discussion out there. Plus, there have been times when this thread comes up first (ahead of Trade Guider) when the term VSA is googled.

 

As for the site itself, you are spot on. That video said nothing. However, I do plan to sign up for the newsletter as well.

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  Eiger said:
For low volume (e.g., for No Demand and Tests) look for volume on the current bar to be less than the previous two bars as a useful rule of thumb.

 

For high - ultra high volume (e.g., for Stopping Volume, Selling Climaxes, Buying Climaxes, etc) look for high volume that clearly stands out on the chart. It should basically jump out at you quite clearly. You can also use a 20-bar simple moving average of the volume to help you see average volume.

 

A useful trick that you will see in many of the charts i have posted is to apply upper Bollinger Bands or a standard deviation application on the volume. Again, use the 20-bar SMA and 2 standard deviations from the mean (you can also add a 3 SDs band, as well).

 

Two Standard deviations captures 95% of all data within the 20 bar sample. Therefore, any volume bar that hits or exceeds the 2 SD threshold by definition is a fairly uncommon event (i.e., it falls within only 5% of the sample) and is therefore statistically significant and can be considered very high volume.

 

If you are a bit obsessive about these things, then the 3 SD (capturing 97.5% of the data) is even more uncommon and indicates a volume level that occurs only 2.5% of the time and is therefore ultra high.

 

Hope this is useful,

 

Eiger

 

nick radge does something similar... a 2 standard dev of the 20 period moving average for the high volume... then a ten period moving average for the low volume....

 

he has two articles on volume analysis... sounds like VSA to me.

The Hidden Strengths of Volume Analysis.pdfFetching info...

The Hidden Strength of Volume Analysis 2.pdfFetching info...

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I'd have to agree with Blowfish that you just get a feel for it.

 

Ultra High is just so obvious of a spike on the volume histogram.

 

I usually use volume less than the previous 2 bars and less than the average for low volume bars. It's all relative to the last few bars. You can't compare lunch volume to opening volume, it's not relevant.

 

As for the spread of a bar I take into account the last 5 bars or so. Look at your current bar in relation to the previous 5 and you'll know if it's narrow, average or wide.

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  giraia_br said:
hi

 

eSignal is the only way to have reliable volume with Forex?

 

thanks in advance.

 

No, you can get tick volume in Tradestation as well. For example, I just created a chart of EURUSD, 5 minutes. In "Format Symbol" look for "For volume,use:" and then click the down arrow and select "Tick Count". Presto.

I've checked the volume bars created this way against those posted on PP's charts, and they're the same (he doesn't use TS), so I believe that the tick volume on Tradestation is correct.

 

 

Can't speak for other charting programs.

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market rises on nice crescendo volume from test-like bar seen on 12th

 

(15)(16) as price advances and volume increases, spread increases commensurate to the volume increase and strong closes... this is healthy and SOS.

 

(17) outside gap up bar close near the low.... volume greater than previous bar however spread is tighter than previous bar.... this indicates capping and the close near the low confirms the selling as well as the next bar down.... this isn't "end of a rising market" (even though this is the end of a rising market) because this squat simply isn't as blatant as others and there is some data further to the left on a sample including more bars so this "end of a rising market" is not into "fresh new high ground."

 

(19) strength coming in or shake out.... outside gap down bar close near the high with the next bar up.... this also looks like a test bar because of volume less than previous two. this bar is a NR7 (tighter spread than previous 6 bars) the narrow spread coupled with decreasing volume indicate strength even though the market has come off.. this is weakness hiding strength this is SOS.

 

(23) inside gap down bar is pushed into the area of the "strength coming in" bar to test supply.. volume is less than previous two and close in the middle or high on a down bar that made a lower low.... this is a test and volume is telling us this will be a successful test next bar up confirms our test.

 

(24) this bar looks like no demand but because of the strength seen on the previous test bar and three bars before on the shake out/strength coming in it isn't no demand and next bar up confirms. after a base /shake-out/test i always allow for a couple weak volume up bars as long as the close is strong because supply has been removed and buyers are reaching for the issue even if volume has not yet reappeared. this is a SOS next bar up after a test. also up until this point volume is increasing on up legs and decaying on reactions and therefore SOS.

 

(26) volume is weak for a bar with this spread... it is a strong marubozo bar out of context however in this context it is hidden weakness. weakness is also apparent because the market is not approaching the old high with volume convincing of a breakout. this is strength hiding weakness SOW. this is the first up bar that indicates buyers are no longer interested in higher prices. previous widespread ups either had healthy demand or supply swamping demand... this bar has no participation... no buying pressure... if this bar had been about 1.5 - 2 times the spread of the previous bar i would've been OK with it on this volume.

 

(29) supply rears its ugly head and this bar is within the spread of the previous top that revealed supply. outside gap up bar into area of previous supply with close in the middle or low ... this in it's own right displays weakness but the tight spread NR4 and massive volume indicate that a ton of supply was dumped onto the market here... the smart money is liquidating and positioning short....

 

(30) this bar tries to test out the supply but the sequential volume pattern tells us this test will fail

 

(31) a close higher than the test gives us a successful test with respect to the closing prices... however weak volume and lower low as well as an outside gap down open on this bar indicates that supply seen to the left will not be broken and SOW within this context this outside bar is a SOW... no buying pressure.... no upside participation. also notice that supply has not reappeared at the highs.... distribution is done for the moment... markdown is potentially on the way....

 

(6) effort to rise with no result... market closes the gap on healthy participation however market falls off indicating this rally was possible short covering after previous distribution seen in background... either way... no interest in higher prices.

 

(7)effort to fall... up until this point volume had been increasing on up legs and decreasing on down legs or in transition... now volume is increasing on down legs and as the 8th and 9th display decaying on reactions higher and SOW.

 

(8) up bar close in middle or high volume less than previous two next bar down also NR4.. no demand and SOW.

 

(9) upthrust... distribution is complete.... some buy stops have been run giving the short term insiders some bearish inventory and the market is primed to drop... SOW,... notice how few buy stops were found on the thrust higher.... momentum players are now positioning as scale down sellers.... overhead demand is confirmed out of the market.

 

I am short Gold and long the United States Dollar for 2009.... not just because of the 20 bar Wyckoff/VSA analysis of the index fund but also because of proprietary open interest analysis of the futures market. Smart money is selling gold and buying dollars... In a deflationary or "disinflationary" (lol) environment this makes perfect logical sense. However I know some folks will complain and say "currency crisis" "stim package inflation"or some buzzword like that ... 2009 is without question the year of the US Dollar. This is a great opportunity to buy dollars on a pullback or sell gold on a rally or both. the potential gain greatly outweighs the stoploss.

 

On the equities side the long dollar play could be partially captured through the use of Canadian companies that export primarily to the united states.... obviously sector and industry would have to be carefully considered. i personally am not buying equities at this point because i am still bearish... despite the bottoming pattern that is trying to form/breakout.... i am still looking for another downleg before reevaluating my long term position on equities. if i am wrong and the market breaks higher i would be totally content to enter on a re-entry pullback opportunity.

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    • By vishnux
      Hey guys , what are the main things you look for to detect if the consolidation area is accumulating or distributing ? 
      1 ) I see springs in top , still markup happens and it becomes accumulation area and vice versa
      2) There is lots of volume absorption in support line and still markdown occurs.
      3) sometimes in market high / low it becomes re-accumulation  / re-distribution
      Is there any clear way to find it ? 
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