VSA : Crock or Not?

[jjthetrader 10]

jj, I like that idea: "Tradeguider's version of VSA, crock or not?" Yup, that seems to make sense. Believe it or not, but this sceptic (yours truely) has recently been successful in applying VSA principles, but NOT bar-by-bar. That's beyond me. The bars-of-interest does seem to work, however.

Taz

 

That's fantastic that you're finding your own style within the principals which are simply supply and demand.

I could never get the bar by bar to work. Bars of interest haven't let me down though.

[HAKUNA 10]

Yes, and like you have said before DB, Wyckoff never did the bar by bar thing. I wonder if the original VSA did either. I don't recall Todd Kruger teaching bar by bar or Tom Williams. They point out bars of interest but I think it's Sebastian who's brought his own style in and made TradeGuiders VSA bar by bar.

I think this thread should more aptly be called "TradeGuiders version of VSA: Crock or Not?"

I think those that have found VSA to be so helpful have also found a different way to apply it than tradeguider does. I use it everyday but I don't do bar by bar analysis. So maybe it's not VSA I'm using at all.

 

You are absolutely right, I had the Bootcamp CD which was mostly Todd Krueger and Tom Williams, this was in early days of TG. Todd was largely responsible for explaining VSA based on wyckoff's principles and used to joke about how he walked around with Tom's original book "Undeclared secrets......." all day long. . He was close to Tom and always mentioned Wyckoff as the root source of VSA and hence he emphasized constantly on the use of S/R levels, trend channels "Playing field" as he called it which I believe was going to be the main theme in his foundation course. This is reflected now on his website Traderscode.com. via 2 courses on Wyckoff.

 

Sebastian OTOH has publicly admitted (London Symposium DVD) that he does not employ any support/resistance levels in response to Gavin's question to the seminar attendees, "Who uses S/R levels in their trading" everybody in the room raised their hands. You can imagine the embarassment on Gavin's face then:) Here he was part of the team sitting opposite the class ..........................

 

Not suggesting that Manby is not a good trader, just pointing out that his bar to bar analysis is not consistent with how Wyckoff traded with price/vol relationships. I use VSA/Wyckoff effectively against relevant levels and ignore most of what goes on between these levels.

 

As far as somebody throwing out laws of probabilities in defence, that is all baloney, applies to any price based indicator, take losses quickly, let profits run on the winners even if they are 30-40% blah blah blah..........

[jjthetrader 10]

On the December 4, 2008 VSA club event Sebastian stated that he doesn't think anyone should trade these instruments intra-day. He said he lost a pile of money trying to do that, always getting stopped out. He uses his analysis on a daily timeframe now only. Again, this doesn't mean VSA doesn't work, it means TradeGuiders VSA doesn't work bar by bar intra-day even for the one who brought bar by bar to the scene. So nobody should be discouraged if they haven't been able to get that to work like it does in hindsight.

 

If you're a market profile trader then you're looking for specific events to occur at set price levels to take your trade from. If you're not at these price levels then you consider the price action to be noise in the market and don't trade it. The same is true for VSA. Not every 3min bar could possibly hold enough significance to take a trade off of. A lot of it is noise. BUT we can use the principles to take trades off of bars or bar combinatins of interest, in areas of interest.

 

Taz, you mentioned you were a sceptic. Do you see that even though you felt this way you still stuck at it and are finding benefit now? You probably sensed on one level that there was some truth in all this but it was buried under a whole lot of marketing giberish. Good job for sticking it out and getting beyond the surface layers. It's almost like religion, you get a sense there's truth there but getting past all that surface crap is hard.

Edited January 9, 2009 by jjthetrader

[monad 10]

On the December 4, 2008 VSA club event Sebastian stated that he doesn't think anyone should trade these instruments intra-day. He said he lost a pile of money trying to do that, always getting stopped out. .

 

Do you still subscribe to the VSA club. Did you find it of any benefit to your trading considering a charge of nearly $100/month. Understand there are over 200 members, Manby and co must be making a bundle, no need for these guys to trade at all.:thumbs up:

[jjthetrader 10]

Do you still subscribe to the VSA club. Did you find it of any benefit to your trading considering a charge of nearly $100/month. Understand there are over 200 members, Manby and co must be making a bundle, no need for these guys to trade at all.:thumbs up:

 

Monad, good to see you man. It's been a long time. The VSA club is not worth the price at all. I thought it would be worth checking out for a while and had access to all the archives while there. Not good.

With comments from Manby like "day trading takes up too much time" and "I don't think anyone should trade these instruments intra-day", you gotta ask yourself what can they teach you if you're a day trader? How to lose money?

 

Honestly the VSA thread here is much better and actually has real trade examples with limited hindsight analysis (which is necessary a bit in teaching).

 

If you feel the need to see one of these archives then PM me and I'll get you one. I'd rather you save your money for something else but be your own judge.

 

However, if you are a true beginner then you will learn about the basics. There is value there for some but having spoken to you in the past Monad, not you.

[monad 10]

Monad, good to see you man. It's been a long time. The VSA club is not worth the price at all. I thought it would be worth checking out for a while and had access to all the archives while there. Not good.

With comments from Manby like "day trading takes up too much time" and "I don't think anyone should trade these instruments intra-day", you gotta ask yourself what can they teach you if you're a day trader? How to lose money?

 

Honestly the VSA thread here is much better and actually has real trade examples with limited hindsight analysis (which is necessary a bit in teaching).

 

If you feel the need to see one of these archives then PM me and I'll get you one. I'd rather you save your money for something else but be your own judge.

 

However, if you are a true beginner then you will learn about the basics. There is value there for some but having spoken to you in the past Monad, not you.

Have been occupied with project work, couple of them abroad.

Am not a beginner as you know, have been around the block , it was just that there was so much hype about VSA club etc. I spoke to Todd Kruegger and Tom Williams some time back, nice guys. Todd certainly was a realtime trader. shame he is no longer there now. but as has been pointed out, he was their backbone then.

[kuky969 10]

Hi

I have interest in Bootcamp CD from Todd Krueger . Can you help me ,is possible buy it ???

Thank

[HAKUNA 10]

Todd is no longer with Tradeguider. I had the bootcamp CD but have sold it. Lot of material in that CD is by Todd but doubt if he is able to market it now.

Think you will have to contact Tradeguider.com

[Tasuki 10]

Taz, you mentioned you were a sceptic. Do you see that even though you felt this way you still stuck at it and are finding benefit now? You probably sensed on one level that there was some truth in all this but it was buried under a whole lot of marketing giberish. Good job for sticking it out and getting beyond the surface layers. It's almost like religion, you get a sense there's truth there but getting past all that surface crap is hard.

 

Hi jj,

Yeah, I was very sceptical at first, especially after losing money with Tradeguider's pathetic software. I also had some problems with the theory, until I realized that there was a firm underpinning in the principles of Wyckoff. Finally, I saw some of you post live trades that worked out, and I started to come around. Right now, I'm using two charts, the 5 min and the 15 min, which is what Pivotprofiler used to use (if you remember his old posts), and that seems to be working well for me. So, I guess I do think that SebMan is wrong, and that you can trade intraday with VSA, if you do it right.

Brilliantly insightful comment, jj, about VSA being like a religion---there is indeed "something there", but you have to get beyond the priests and the incense to grasp it.

 

Taz

Edited January 9, 2009 by Tasuki
correct "an" to "a"

[jjthetrader 10]

Hi jj,

Yeah, I was very sceptical at first, especially after losing money with Tradeguider's pathetic software. I also had some problems with the theory, until I realized that there was a firm underpinning in the principles of Wyckoff. Finally, I saw some of you post live trades that worked out, and I started to come around. Right now, I'm using two charts, the 5 min and the 15 min, which is what Pivotprofiler used to use (if you remember his old posts), and that seems to be working well for me. So, I guess I do think that SebMan is wrong, and that you can trade intraday with VSA, if you do it right.

Brilliantly insightful comment, jj, about VSA being like a religion---there is indeed "something there", but you have to get beyond the priests and the incense to grasp it.

 

Taz

 

I don't agree with Sebastian either. You can indeed trade this intra-day. Plus who can afford to trade these leveraged instruments with the stop necessary on daily bars?

I lost money in the very beginning using their software to. The biggest loss was the price of the software. But I learned the truth behind the crap and developed a way to trade.

 

5min & 15min are good timeframes. Because of the stop size I am willing to keep I have to trade smaller timeframes.

 

Taz, you should post some of your trades on the VSA thread so others can see how to actually apply it.

[Tasuki 10]

Taz, you should post some of your trades on the VSA thread so others can see how to actually apply it.

 

jj, I have hesitated to post trades because I'm not a VSA purist, and I've got all sorts of other stuff on my charts. Early on in the VSA I thread, moving averages and such were roundly criticized, so I've held back from posting for fear of offending the VSA experts (and getting laughed at). Their argument was, this is a VSA thread, we should be focussing on that and not a whole bunch of unrelated stuff, and to a point they were right. The laser-like focus that the VSA II thread has placed on VSA has been one of its strengths. Diluting it with oscillators, moving averages, etc., might be counterproductive.

Taz

[HAKUNA 10]

jj, I have hesitated to post trades because I'm not a VSA purist, and I've got all sorts of other stuff on my charts. Early on in the VSA I thread, moving averages and such were roundly criticized, so I've held back from posting for fear of offending the VSA experts (and getting laughed at). Their argument was, this is a VSA thread, we should be focussing on that and not a whole bunch of unrelated stuff, and to a point they were right. The laser-like focus that the VSA II thread has placed on VSA has been one of its strengths. Diluting it with oscillators, moving averages, etc., might be counterproductive.

Taz

 

You can post without fear, just no need to elaborate on other indicators. Couple of guys try to monopolise that thread assuming status of Gurus, just ignore them VSA/Wyckoff is not dependent on any personalities. One even came to teach laws of probabilities completely missing the point I was trying to make which is the essence of both VSA and Wyckoff.

Also lately there is much talk about Wyckoff, prior to that they wanted nothing to do with that.

Once again remember the thread does not belong to anybody in particular, anybody who disagrees with you can go elsewhere and bang their heads.

I have tried to be polite, have had enough now:)

[deepblue27 10]

jj, I have hesitated to post trades because I'm not a VSA purist, and I've got all sorts of other stuff on my charts. Early on in the VSA I thread, moving averages and such were roundly criticized, so I've held back from posting for fear of offending the VSA experts (and getting laughed at). Their argument was, this is a VSA thread, we should be focussing on that and not a whole bunch of unrelated stuff, and to a point they were right. The laser-like focus that the VSA II thread has placed on VSA has been one of its strengths. Diluting it with oscillators, moving averages, etc., might be counterproductive.

Taz

 

Well I for one would love to see a discussion on any bastard child of VSA hybrid technique, even if in a separate thread. Debating whether something is wyckoff or VSA, or non related, seems rather moot at times. I don't believe one should have to pigeonhole ones method for such a prediomentally discretionary and deeply interpretational thing as price action (with volume.) I would imagine most peoples trading styles are the culmination of all the knowledge they've learnt anyway. Having said all that you've got to stick the damn stuff somewhere on the forum

 

Re the thread. I wouldn't put it past TG VSA being a load of crock; especially bar by bar intraday. I would imagine doing that, you risk missing the forest for the trees.

[Kiwi 16]

I think it is worth keeping at least the key threads clean. Otherwise readers can't judge the underlying method.

 

But it seems only reasonable to run parallel hybrid threads within the overall forum --- just labeled as such. Otherwise things get stultifyingly boring once the basic stuff has been explained 15 or 20 times.

[jjthetrader 10]

I think it is worth keeping at least the key threads clean. Otherwise readers can't judge the underlying method.

 

But it seems only reasonable to run parallel hybrid threads within the overall forum --- just labeled as such. Otherwise things get stultifyingly boring once the basic stuff has been explained 15 or 20 times.

 

I think Kiwi is correct. Maybe it is best to keep the original thread clean and start an offshoot. I would be into that. Even my own personal style is diverging from the orignal 'pure' teaching. I use Market Profile and Pivots and, don't tell anyone, an indicator! lol.

 

The thing with VSA is that you need these things to create areas of opportunity. Often in a rally you'll get thrusts and no demand etc but in the middle of nowhere and even though the market will come off a bit, it's these areas where professional money will actually step in to push the other way.

Even MA's represent areas of interest. Do the professionals watch MA's? Probably not but they will support a certain price and this often lines with with the cycle of the market (ie 20 EMA on the ES). We look to these areas to see if indeed they are supporting price there. If so we'll see it and can take a trade off of a moving average!

[jjthetrader 10]

Ok, I've opened up a new thread so we can discuss your different VSA styles.

 

http://www.traderslaboratory.com/forums/f151/combining-vsa-with-other-modalities-5245.html#post56547

[samhollander 10]

:)Watched Manby's videos & most of his right edge next bar predictions were wrong.But no excuses were given [i say good for him] Why criticise VSA, If you like what it does go for it.I'm trying to get away from MA, MACD,STOCH.On paper trading worked for me.Not so good in realtime.But I don't critcise,obviously they work for some.

[HAKUNA 10]

I think Kiwi is correct. Maybe it is best to keep the original thread clean and start an offshoot. I would be into that. Even my own personal style is diverging from the orignal 'pure' teaching. I use Market Profile and Pivots and, don't tell anyone, an indicator! lol.

 

The thing with VSA is that you need these things to create areas of opportunity. Often in a rally you'll get thrusts and no demand etc but in the middle of nowhere and even though the market will come off a bit, it's these areas where professional money will actually step in to push the other way.

Even MA's represent areas of interest. Do the professionals watch MA's? Probably not but they will support a certain price and this often lines with with the cycle of the market (ie 20 EMA on the ES). We look to these areas to see if indeed they are supporting price there. If so we'll see it and can take a trade off of a moving average!

 

will second that, how does anybody know for certain what professionals are using or not using. As has been pointed out by Dbphoenix and others why not get away from this smart/retail money stuff and focus on buying and selling pressure at relevant price levels, life becomes a lot easier that way ie. when prices are rising, demand is coming in, if accompanied by vol, buying pressure is greater (beautifully explained on the wyckoff forum), forget who is buying or selling and why. As day traders what matters to us is buying or selling pressure.

[jjthetrader 10]

will second that, how does anybody know for certain what professionals are using or not using. As has been pointed out by Dbphoenix and others why not get away from this smart/retail money stuff and focus on buying and selling pressure at relevant price levels, life becomes a lot easier that way ie. when prices are rising, demand is coming in, if accompanied by vol, buying pressure is greater (beautifully explained on the wyckoff forum), forget who is buying or selling and why. As day traders what matters to us is buying or selling pressure.

 

Exactly, even 1 and 2 lot traders can push your trade into profit as long as there's enough of them.

 

As for Sam using MA's, those types of things rarely work on their own. I was discussing them in relation to VSA.

[DbPhoenix 42]

Why not a "VSA For Beginners" thread? Pre "Master the Markets". Pre "Trade Guider". No indicators, no candles, no VWAP, no Taylor, no SMI, no anything that is not in the source material. Surely this would be of benefit to those who are daunted by a thread that is working toward 3600 posts. Purists would be delighted, and anyone who wants to start a thread combining VSA with something else is free to do so.

[HAKUNA 10]

Good idea Db,

That way we will have 3 threads

 

1. The existing VSA - with experts at bar by bar analysis, tracking professional money

 

2. VSA thread by JJ - VSA plus any other tools

 

3. Pure VSA - pre "Tradeguider" and "Master the Market"

Guess that would almost border on Wyckoff, as Tom William studied the SMI version.and then published his "Undeclared secrets..................

 

 

Would certainly do away with clashing of egos:)

[DbPhoenix 42]

Good idea Db,

That way we will have 3 threads

 

3. Pure VSA - pre "Tradeguider" and "Master the Market"

Guess that would almost border on Wyckoff, as Tom William studied the SMI version.and then published his "Undeclared secrets..................

 

Almost, but not quite. There is much that those interested in VSA can learn from Wyckoff, but the use of "the bar" separates the two, as does the role of "professional money" (the word "smart" is found nowhere in the source material).

 

Nonetheless, "Undeclared Secrets..." is almost simplicity itself, and it's far easier to understand than much of what is posted and published regarding price and volume and their relationship. Those who are lost might find an anchor in the original material.

 

While I haven't posted to or followed the thread since May of last year, I'm sure there's someone on board who can act as guide through the original material.

[deepblue27 10]

Well its certainly a fine line between the evolution of a methodolgy (hybrid system), and the unnessecary adding of 'filtering' indicators. I think a lot of people have been there, done that, and wasted a lot of time doing so. But you should be free to discuss anything without someone spitting their dummy out on semantics.

 

Now I suppose the harsh reality of trading that something either makes money or it doesn't begs the question whether a methodology is a lot of hot air. But I see all potential analysis (whatever it is) as a means to an end. However what would concern me more than a system not making money (I can simply move my attention else where like i have done countless times) is whether a methodolgy is peddling misinformation that I take to be true! (Since this will effect my knowledge base for the future.) So this is the crux surely of whether parts of VSA are crock or not.

 

Threads like this are vital, especially to newbies (like myself.) It is a well known fact that if you put a group of people who all believe the same thing into a room; all they end up doing is reinforcing said beliefs and patting themselves on the back. They are never challenged to re-evaluate those beliefs or try to improve on them.

 

In that vain, for those that do, could anybody summarise the main bones of contention they have regarding VSA? Be it technical or principled.

[Tasuki 10]

In that vain, for those that do, could anybody summarise the main bones of contention they have regarding VSA? Be it technical or principled.

 

 

Gosh, I hope you meant, "in that vein" VSAers are NOT vain, but you're right, they are very principled

 

The major bone to pick is the central dogma of the "smart money", or BBs (Big Boys). There are two problems here:

1) for highly liquid instruments, like the S&P emini, or ES, do the BBs even have the financial muscle to manipulate it? If you do the math, it is actually unlikely that they do. It would take a massive amount of capital to move the ES significantly. A point or two, here or there, OK, but VSA principles suggest that the BBs have to be massively moving the market, basically controlling it, in order for VSA principles to work, and this would seem to be mathematically impossible--it would just take too much money to do so.

2) for liquid and illiquid instruments, why do we think that the BBs are operating in concert with each other? The fact is, there is no evidence that I've seen that they act in collusion, and there is significant evidence from those who have worked in the big trading houses that they are just as much competitive with each other as they are with "the masses." However, one regularly hears VSA proponents saying that "the Big Boys are buying here, or selling there" when the truth is probably closer to "some Big Boys are buying here and other Big Boys are selling here." For living proof of this, listen to the squawk box for a few days and you'll see (OK, you'll *hear*) what I mean. So, the question becomes--how can they move the market if they are fighting each other?

 

So, how *does* VSA work? To be honest, I'm not sure, but it does. The answer probably lies in the psychology of crowd behavior. In fact, I think that we VSA folks should look very carefully at this branch of psychology, because I think it holds the key to understanding how the market moves, and why VSA works.

[Kiwi 16]

An interesting analysis Tasuki.

 

I don't think I've ever posted on VSA before - simply because when I looked at it and listened to its key advocates I didn't really see value.

 

Why does VSA work at all?

- because it has elements of Wyckoff/PA trading built in that do have an edge?

- because practitioners pick up on that same action in their chosen markets and develop some trading "intuition" that adds to the edge?

 

The "big boys" etc stuff is probably largely a fantasy the makes trading more enjoyable because one feels an increased sense of certainty, the satisfaction of taking advantage of said bbs, and that this is why one should do X, Y and Z in a disciplined manner.

 

Cool really.