[VSA] Volume Spread Analysis Part I

[RAVIN 10]

There you go, meant to say you guys are getting good at this,

Get hold of article "Day Trading S&P futures" by Linda Raschke, (on her website), there she mentions a Professional who has made a most enviable living for over 15years by trading just one of these setups and that also trading only in the afternoon (patience) and goes in with size. She says the moral of the story is he knows himself and what style works best for him and he always has a resting stop loss order in the marketplace

[tawe trader 10]

due to US futures being up due to the possible rate rise. I have been patiently waiting for a place for a quick short.

 

I meant to say possible rate cut.

 

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Thanks Ravin and JJ for your kind words of encouragement.

 

Great quick-in-and-out trade JJ, I know you may be kicking yourself for giving up a further 9 pts but even with the understanding of VSA we still can't predict the future with 100% certainty. We can only be patient and wait for low-risk setups to appear before acting.

 

After I got out of my trade the mkt went sideways for about 45mins before turning back up and past R2 level. I wouldn't have made more than another pt or two if I had stayed in.

[jjthetrader 10]

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.

[marketguy 11]

I was wondering if any of you are using TraderGuider software and what your experiences are?

 

Thanks

[jjthetrader 10]

I was wondering if any of you are using TraderGuider software and what your experiences are?

 

Thanks

 

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.

[marketguy 11]

Thanks for the reply. It was really helpful. Is there is TL discount for it?

[jjthetrader 10]

Thanks for the reply. It was really helpful. Is there is TL discount for it?

 

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

[marketguy 11]

jjthetrader:

I have been reading a good deal of this thread. There is a lot of negative things said about TG. I'd like to run a few things by you.

 

1. Several guys claim that signals in TG change depending on the next bar. So, a signal that looks good after the fact may not have actually been at the same spot real time. True or false?

 

2. How is the customer training? Do we get a lot of Todd?

 

3. Do you see TG as an indicator based system or are a signals just a guide to use simplify and use VSA effectively.

 

4. Could you get by effectively, at this point, without the signals?

 

Thanks

[smwinc 20]

jjthetrader:

I have been reading a good deal of this thread. There is a lot of negative things said about TG. I'd like to run a few things by you.

 

1. Several guys claim that signals in TG change depending on the next bar. So, a signal that looks good after the fact may not have actually been at the same spot real time. True or false?

 

2. How is the customer training? Do we get a lot of Todd?

 

3. Do you see TG as an indicator based system or are a signals just a guide to use simplify and use VSA effectively.

 

4. Could you get by effectively, at this point, without the signals?

 

Thanks

 

I spoke with Todd in person a few months ago. He is no longer affiliated with TradeGuider.

 

With regards to the other questions, I have not used TG and can't comment on it.

 

SMW

[Anonymous 11]

jjthetrader:

I have been reading a good deal of this thread. There is a lot of negative things said about TG. I'd like to run a few things by you.

 

1. Several guys claim that signals in TG change depending on the next bar. So, a signal that looks good after the fact may not have actually been at the same spot real time. True or false?

 

2. How is the customer training? Do we get a lot of Todd?

 

3. Do you see TG as an indicator based system or are a signals just a guide to use simplify and use VSA effectively.

 

4. Could you get by effectively, at this point, without the signals?

 

Thanks

 

These questions were not posed to me, but I would like to chime in on a couple.

 

1. This is the biggest issue of all. First, I do not like TG software and believe it is not necessary. Now for the answer. Most "signs" of strength or weakness are two bar signals. Like many candlestick patterns, certain requirements need to take place both before and After a particular candle or bar on many of the signs. Now, when a person looks at a static chart on the web, they may see a No Demand on the highest bar and just before the price fell. This looks good and makes them think the exact top can be called. Which is of course, what the uninitiated newbie and losing trader is looking for.

 

What they do not understand is that the No Demand bar is only no demand if certain criteria are met on the next bar. So the software will wait for the next bar and then place a sign on the High bar (1 bar ago). Now it looks like it is late in real time and in a static chart it looks like it is a perfect fit. So while it may appear that the high tick or the low tick is being called it really is not.

 

Take a look at the work of John Pearson on High/Low close Dojis. Obviously by the name, you can see that while the doji is the point of interest something must happen AFTER the doji: a high/low close. If the lowest candle is a Doji and the next bar closes higher, then it may look like the entry was on the bottom bar (the doji). But by definition the entry is two bars later. The 1st bar after the doji must complete the pattern on the close. Suppose your software places a dot on the doji. It would look pretty dead on and some would mistakenly assume that was the entry point. This is where people go wrong.

 

 

I do not use TG. Here is what my software (vt) does on one of my definitions of No Supply:

 

A. It will look for a bar that has volume less than the previous two bars that is has a lower low than the previous bar and closes lower.

 

B. To be No Supply, the next bar must not make a lower low or close lower. Hence as soon as the next period opens, and does not open lower than the previous close, a dot will appear. If the current price trades equal to the previous close, the dot disappears. If it then trades up, the dot re-appears. ONLY AT THE END OF THIS NEXT PERIOD WILL THE DOT BE EITHER PERMANENTLY AFFIXED THERE OR NOT. It is therefore possible to look at a bar and see a sign, turn the computer off and come back and find the sign no longer there. Why? because the first time was DURING the interval of the next period and not on the CLOSE. TG works much the same way.

 

2. Todd is no longer with TradeGuider.

 

3. TG does not give buy/sell signals they are indications of strength and weakness. However, the red/green bar paint is basically an indicator based buy sell method if one wanted to use it that way.

[monad 10]

:)So Who is providing support/teaching on VSA, now that Todd is gone. Attended a couple of live seminars, does not look as if anybody has any real trading experience, no shortage of talk though:)

 

A colleague had the software for a trial period, it is o.k, the above comments on signals via 2 or 3 bars are very pertinent to the package, so initially it does help to learn VSA with the explanations of each indicator popping up, but it is not absolutely necessary, the bootcamp CD is more helpful I am told.

[monad 10]

I have attached todays FTSE Future 5 min chart. .

Any thoughts anyone.

 

Good trading on the ftse, tried the instrument sometime back, was very spikey then.

 

1. How do you find you fills, and what do you think of the liquidity.

2. Which trading platform you use for trading ftse

3. Also which data feed, do they provide charting with it.

 

Do post some more as I am thinking of trading the instrument, what is the tick value?

[tawe trader 10]

Good trading on the ftse, tried the instrument sometime back, was very spikey then.

 

1. How do you find you fills, and what do you think of the liquidity.

2. Which trading platform you use for trading ftse

3. Also which data feed, do they provide charting with it.

 

Do post some more as I am thinking of trading the instrument, what is the tick value?

 

Hello monad, I'll try and answer your questions.

 

As I live in the UK I trade through a spreadbetting company, they do supply free live charts but there is no volume so I use Sierracharts with a DTN IQFEED, which I am very happy with. I haven't had many problems getting filled through the s/bet company and there's plenty of liquidity in the mkt. I also don't find it that spiky.

 

I believe the tick value or pt value is £10 through a Futures broker.

 

I will post some more charts (in a word doc) as I now know how to upload them to this forum.

[jjthetrader 10]

jjthetrader:

I have been reading a good deal of this thread. There is a lot of negative things said about TG. I'd like to run a few things by you.

 

1. Several guys claim that signals in TG change depending on the next bar. So, a signal that looks good after the fact may not have actually been at the same spot real time. True or false?

 

2. How is the customer training? Do we get a lot of Todd?

 

3. Do you see TG as an indicator based system or are a signals just a guide to use simplify and use VSA effectively.

 

4. Could you get by effectively, at this point, without the signals?

 

Thanks

 

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.

[Seb Manby 11]

I have been told about this thread by a friend of mine in London. I wil post my charts and commentry for you all to read(If you like)

 

This week I am staying with Tom Williams, so it may be a bit hit and miss.

 

Regards Sebastian

ES Analysis for 3rd Dec 07.pdf

ES Analysis for 30th Nov 07.pdf

[TinGull 10]

Welcome Seb! Are you VSA Trader on the T2W boards by chance? I loved reading those posts.

[MrPaul 10]

I have been told about this thread by a friend of mine in London. I wil post my charts and commentry for you all to read(If you like)

 

This week I am staying with Tom Williams, so it may be a bit hit and miss.

 

Regards Sebastian

 

Post away! Your input is much appreciated

[bertg 10]

I have been told about this thread by a friend of mine in London. I wil post my charts and commentry for you all to read(If you like)

 

This week I am staying with Tom Williams, so it may be a bit hit and miss.

 

Regards Sebastian

 

Sebastian,

 

I follow this thread and it's got great contributors.

 

Thank you for the analysis. I enjoyed the first edition. Please keep posting.

 

Pretty chart, too. Not sure I've ever seen a chart background with a gradient.

 

Regards,

Bert

 

edit: I have Adobe Reader 6, so I'm sure later versions have this feature, too: I watched the chart and listened to the narration. From my mac os 8.5 days, sounds like Bruce voice. I thought it was way cool. Do a View>Read Out Loud> and select one of the options, and see how you like it.

[Seb Manby 11]

Welcome Seb! Are you VSA Trader on the T2W boards by chance? I loved reading those posts.

 

Hi TinGull;

 

Yes, I use the VSATrader over at Elite and T2W.

 

Regards Sebastian

[RAVIN 10]

Hi TinGull;

 

Yes, I use the VSATrader over at Elite and T2W.

 

Regards Sebastian

 

Great to see you here, a close friend "Rak..." talks a lot about your expertise in this field. Besides your daily analysis, your comments and input on posts by others regarding their trade setups etc would be greatly appreciated . Majority would like to learn how to trade with reading VSA. i.e VSA is fine in identifying areas of changes in supply/demand, how can that information be used to determine entries and exits (strategy/tactics).

[jjthetrader 10]

I have been told about this thread by a friend of mine in London. I wil post my charts and commentry for you all to read(If you like)

 

This week I am staying with Tom Williams, so it may be a bit hit and miss.

 

Regards Sebastian

 

Right on! Now this is what I like to see!

Thanks for contributing.

[monad 10]

Sebastian,

Have studied the ES charts, but am now confused as to how to implement the info. in trading this in realtime.

 

For example, at point D & E there is weakness, then there is strength at F,

Similarly at G weakness, at H strength. How do we determine entry for a trade in these situations, are we talking about gunning for a point or two?

for although the bar at "I" looks ideal in hindsight, bars could have popped up as before showing strength. How does one manage the trade under these circumstances??

[monad 10]

forgot to attach chart,

[Primavera 10]

I have been told about this thread by a friend of mine in London. I wil post my charts and commentry for you all to read(If you like)

 

This week I am staying with Tom Williams, so it may be a bit hit and miss.

 

Regards Sebastian

Sebastian

 

Welcome - I have one quick question on bar A on the 3rd dec chart. You stated that a wide spread down on high volume is generally bullish. However this bar closes near the low, so would this not be interpreted generally as weakness.

 

Primavera

[ranj 10]

Sebastian

 

Welcome - I have one quick question on bar A on the 3rd dec chart. You stated that a wide spread down on high volume is generally bullish. However this bar closes near the low, so would this not be interpreted generally as weakness.

 

Primavera

Primavera

Not Sebastian, but the next bat was up, Telling us that there was some strength in the high vol down bar.