a VSA chart a Day

[Vercingetorix 10]

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.

 

[Vercingetorix 10]

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"

 

 

[flatwallet 10]

Nice play and it was in real time...nice call