Volume Spread Analysis

Well, looking at your later charts it’s now hard to see price for all the squiggly lines. I wouldn’t exactly say that you trade the original VSA method.

Personally I’ve moved up to higher time frames, so your kind of trading doesn’t interest me.

Some more edu stuff would probably be a good idea, just don’t copy/paste like so many others do.

Yes, I have taken VSA, s/r (murry math, pivits, fibbs) and some emas (squiglys lol) and made my own approach, not that I invented any of it…just my custom rsi. I also look at larger TF, but I like the 5min for entry.

Hello o990l6mh,

As you well know: I LIKE BOOKS!!! So: I’ve just downloaded Tom Williams’ book ‘The Undeclared Secrets That Drive The Stock Market’. Odd isn’t it i.e. it would seem that you need to have the surname of ‘Williams’ to make it in this business!!! LOL!!! (And yes: I’ve downloaded it i.e. I’ve ‘paid my dues’ when it comes to buying books)!!!

Anyway: I’ve only JUST started reading it but I thought that I just had to let you know that I found it ‘uncanny’ that within the very first pages the issues that I mention on that other thread are noted.

Thanks for the recommendation. Let’s see what THIS book and THIS author has to say!!!

Regards,

Dale.

Hi Dale

Yes, maybe we should change last names!

I think you’ve made a good choice reading that book. Maybe not necessarily the method itself, but the authors explanation of how it all works was like a light bulb switching on to me.
Don’t forget to have a serious look at the James16 way of trading. After the time I’ve spent so far learning (which is but a fraction of your time) I’ve come to believe that there’s no better way to trade for me, than that.

Hello,

I must tell you that I’m about a third of the way through the book and there is some VERY SOBERING information in the first few chapters (about market makers and professional traders and how THEY operate). I like the way it’s explained too.

Thanks again.

Dale.

Good (Sunday) morning,

I did not manage to read MUCH more last night before going to bed BUT as I went to bed I kept feeling that I’d read about all of this before (VSA). When I awoke it ‘dawned on me’. (This happens A LOT I’ll tell you. I go to sleep with a ‘trading issue’ and awake with the possible solution. Maybe THAT’S my TRADING problem i.e. maybe I don’t get enough sleep. Either that or this business has slowly been pushing me ‘over the edge’)!!! LOL!!!

Anyway: BILL Williams developed an indicator that I THINK is ACTUALLY BASED on what we are NOW calling VSA. HE called it his ‘Market Facilitation Index’ or ‘MFI’. Here is a link to a basic (VERY basic) description of his MFI:

Forex Trading with Alpari (US) Market Facilitation Index (BW MFI) - Bill William’s Chaos Theory - Market Analysis Guide - Alpari Academy

(This indicator is part of MT4’s ‘standard’ indicators).

Take a look and see what you think. I’m not saying that it IS VSA but it sure looks like an ‘attempt’ at VSA based on my reading of TOM Williams’ book thus far. (The ‘kicker’ is that BILL Williams developed this MANY years prior to 2000).

What I CAN tell you is this: I coded this indicator (from my BILL WILLIAMS BOOKS) into my trading platform and spent many days assessing its merits. What I CAN tell you is that its signals are EXTREMELY accurate for stocks i.e. where you SHOULD have (I do have) the CORRECT VOLUME data. I cannot comment on its accuracy for forex pairs because I don’t have ANY volume data for forex pairs on my platform.

(I’d not bother with the REST of ‘Chaos Theory’ i.e. it’s trend following ONLY and, to be honest, I’ve never understood just WHY the MFI was presented as part of ‘Chaos Theory’ i.e. the MFI can and should be used on it’s OWN).

Anyway: just a thought. Take a look and see what you think. If I’m wrong about this then I apologise. If not: then maybe you (we) already HAVE a form of VSA available to us. The ‘trick’ is to know how to use it correctly!!!

I shall be reading (Tom Williams) further now.

Regards,

Dale.

Edit:

You know that while I was reading Tom Williams’ book yesterday I was even MORE DUMBFOUNDED by some of the input given on that other thread of mine i.e. where the suggestion was made to NOT read books on the subject!!! This type of information IS NOT something that a ‘new trader’ (or anyone else without YEARS of experience for that matter) is simply going to ‘piece together’ by staring at a chart all day!!!

VSA does’nt work don’t waste ur time Wyckoff was an exceptionally talented trader thats why he was successful not because of VSA

VSA is completely unproven this Tom Williams guy basically jut tries to sell you his software in his VSA book. He claims to use whyckoff’sprincipleas but it got him no where.

The VSA gang at ff started out with a bang but now they’ve become so desperate they’re trying to sell mentoring services. Despite knowing advertising for mentoring services is against the rules at ff they’ve still gone ahead and advertised which just shows how desperate they are.

For heaven’s sake don’t get suckered into all this.

Hello GirlsCantTrade (I’m surprised you’ve not been ‘lynched’ with THAT login name yet) LOL!!!

Far be it from me to accept nor reject your statements as I don’t know enough about Tom Williams or whatever it is that he or his ‘gang’ may or may not be trying to sell (and I’ve also not finished reading this book either).

I must say this though: the relation of VOLUME to PRICE MOVEMENT and visa versa cannot simply be discounted (for stocks anyway). I believe that CONCEPTUALLY (from what I’ve read thus far): Tom Williams does a stellar job of explaining this relation (I’ve not got to any part YET that’s trying to sell me something but I’m sure it will come)!!!

Personally I believe that ANY (good) information that’s out there that will increase your UNDERSTANDING and KNOWLEDGE of how this all works is well worth it. Buying software and ‘black box’ systems and the like??? Well no.

Regards,

Dale.

Hi Dale

I’ve read Trading Chaos as well and am familiar with the MFI. I agree with you that MFI was out of place in that book.

But the MFI is just an indicator (mathematical abuse of past trading data) with four possible outcomes. The MFI could for instance not tell apart an up thrust from an ordinary bar that fills the same criteria according to MFI code, but that clearly isn’t an up thrust when the human eye and brain looks at it.
This is the weakness of all attempts to automate human interpretation, maybe someday when computers are smarter, but not in the foreseeable future.

This is something that has become painfully clear to me - indicators cannot think, and trading successfully requires clever thinking and the kind of fuzzy decision logic that computer code is unable to do.
That’s why I have rid myself of ALL indicators and look just at price, candlestick reversal formations and S/R levels where these occur. Then it’s up to my brain.

Try to clear out the indicator thinking for a while Dale and give the price action way a chance. It’s a completely different way of trading, there’s no oscillator or something telling you what to do, you have to figure that out yourself, and that’s hard at first but after a while you’ll start thinking: “how could I ever let an indicator tell me what to do! I must have been stark mad. Look at RSI telling us to buy, when my own brain is clearly telling me that sell or stand aside are the only sensible options!”

First of all, you should be slapped for the disrespect in your user name.

Second, the book “The Undeclared Secrets That Drive The Stock Market” was written long before Tradeguider came into the picture.
Your way of accusing Tom Williams is really kind of pathetic.
“Master The Markets” is the same book but with Tradeguider promotion.

The VSA people at FF all since the start seemed to have a love for cluttering their charts with indicators and messing things up, in spite of that there are several users there who trade successfully and have done so for years.
VSA is certainly not unproven and you claiming that shows that you have no clue.

I haven’t seen the mentoring services you claim they push, could you link please?

Like I’ve said before, Tom Williams book is a great read, but not necessarily for the VSA trading method. VSA is good to have as part of your toolbox, but just simple S/R and reversal formations is enough to trade well on higher time frames.

Sorry: I know I shouldn’t ‘clutter’ your thread but these two lines had me in absolute ‘stitches’:

mathematical abuse of past trading data

and

First of all, you should be slapped for the disrespect in your user name

ROFLOL!!!

The FIRST one is (probably) what ALL my trading systems are based on!!! LOL!!!

Regards,

Dale.

sorry but the truth hurts buddy

I haven’t seen the mentoring services you claim they push, could you link please?

Hey sure you can its in the recycle bin which says a lot

forexfactory.com/t/154339/p_2937235/learn-trade-vsa-volume-spread-analysis-91.html#post2937235

Good luck with VSA believe me you’ll need it unless of course you start selling ur VSA mentoring services which would be the smart thing to do but I doubt you can see that

Happy trading in fantasy land or VSA land as you call it.

This just shows what an infantile person you are. More than likely that reflects on your trading ability, which you of course will deny, but who cares.

Oh, and by the way, luck has nothing to do with trading as far as I’m concerned. None the less I wish you good luck too, [I]you[/I] might need it.

Feel free to think up the catchiest answer you can, I won’t waste more energy on you.

Looks like the old guard got another new person banned.

wow what did i miss??? two new people banned does anybody know why?

It wasn’t two people, but rather the same. Admin has been banning the same user who keeps coming back under different usernames.

Guys this is the first time I participate in this wonderful forum of Babypips. I’d like to share you my experience with Tom William and VSA and whether their software does work or not.

I’d been introduced to Forex in Sept 2007 through one of my good friends who is one of the biggest fans of fundamentals. To make my story short enough, I wasted money and time on trading blindly jumping from a mentoring site to another till the moment came when a trader gave me a link to TradeGuider (Tom William/Gavin Holmes site).

I registered for their free webinars and listened carefully to Gavin who was explaining what VSA means and why we need to master this concept in order to be successful. From that moment I decided to purchase the software and give it a try and two weeks later I bought it. However, it didn’t help me to be a good a trader at the beginning and the reason was that I needed at that moment to get better grasp of VSA and train my mind and eyes how to read the CHART as Tom William and Gavin did in their webinars. After reading MasterTheMarket book more than five times and attending every free webinar within two years till last month I discovered that TG doesn’t work at all. Not just this fact but I also deciphered the main reason why I was so stupid to buy such BlackBox software and I mean it - it’s black box software. Gavin is so brilliant in the fact that he’s disseminating to all new traders in the financial markets that the markets are manipulated by big players and they do that in order to defraud them legally and grab money from their accounts. While the fact is, the market is mainly driven by supply and demand law which is simply depends on peoples’ perception of the economic data and whether it adds value to them.
So Gavin used this idea to sell his software. How many times I read questions from participants in webinars do you consider the red and green indicators that appear on the chart as buying/selling indicators or signals and his answer was no rejecting many times to admit that they are trading signals instead they are indications of potential change in supply and demand. Oh I have written too much lol but let me explain how I discovered unfortunately so late that VSA doesn’t work in FX markets.
VSA cannot be applied to FX markets because there are no centralized trading exchanges such as those available for stocks, futures and options like CME where all trading volume data appear in your screen transparently. FX volume is simply tick volume which means for every tick, volume indicator will increase accordingly. Compared to the real volume which contains tremendously valuable info about the size of actions at the bids and asks which allows you to precisely predict in which direction the instrument is heading, tick volume is simply a histogram of tick counts over time intervals nothing more. Till this moment, when I look at FX charts with tick volume I can’t expect what the price is going to do next because simply tick volume doesn’t give �at least for - me clear change in the market behavior as the real volume does. TG signals are triggered based on price actions that what I have observed during this period.
It’s too late now I have to go to the bed�… To be continued…

First I would like to say I am an active member of ff vsa thread by Shamus. He and others have provided untold informaiton and help to others . The vsa thread in ff that was mentioned where the guy is offering mentorship services is one run by NYSE1992. I got banned form his thread as I kept on correcting him .

I have been using vsa for about 2 years now so a good degree of success.

I do use tradeguider , but only just recently purchased it and the reason was mostly for the watch lists and to scan for vsa set ups in London , US , fx and futres market on all time frames , including a very succesful 1500 pip trade recently on the gu off a weekly futures charts,

Mostly I use esignal with the better volume indicator.

The thing that most do not think about when learning VSA is that is really is about the left hand side of the chart and higher time frames. For example when a trend is clearly up no demand bars are not really applicable and nor should they be shorted in a primary uptrend. I have seen so many traders new to vsa short these one bar set up in an uptrnad and then wonder why they do not work . However if the market goes up and ends in a rising market , than we have an up thrust several bars later and then a no demand bar then they are very shortable , particulary if this happens on a 30 min chart over a 6 hour period.

Salman do not give up hope on what you have invested in . It is more the way that you are using it that is going sideways. Always look for volumes sets up in the sweet spots of support and resistance. Look at GU 15 min today at start of US market , in london over night we saw supply coming in 1.5190 at R , then market dipped , then made another move up into 1.5150 with very high vol ( TG did nOT pick this up on 15 min … but being vsa knowledgable you could see it) . This was another sign of weakness after we saw supply hitting market several hours earlier. also it formed a lower high . Then at US open we had a 2 bar reversal set up on gu just above 1.1560 as gold was getting hammered . This was on high volume. So based on weakness in back ground it was a pretty safe sell … and did give a 100 pip trade. NOw if you had of entered 8 hours earlier on the 1st supply hitting market you would have had a much more painstaking trade.

also the best possible feed for fx is the feed you have for TG , the esignal 200 source GTIS feed. It is very representative of the fx market as a whole and more importantly it works.

I do post time to time on the ff thread , do not offer mentorship serives nor will ever ask . This was nYSE1992 … not anyone on Shamuses thread… just love posting and trading to help others.

malcomB,

I have been following shamus thread on VSA and can see you are a contributor.

I am new to VSA and very keen on learning it as I find it interesting. Do you still think purchasing the tradeguider software is still worth it?

I am not going to use it on a live account because for me its all about learning at this stage and i am hoping TG will help me with this? Interested to hear your thoughts.
I would have PM you but I only have 1 post previously so cannot.

Salmon - Hope your hanging in there. I do think data source is paramount when using VSA.

Volume in Forex will be only from the broker you are using. There is no way in measuring all the volume that is out there at any given time in Forex. Therefore any indicator that is made may take a “educated” guess at the volume that is out there.
Conclusion: you need a big broker company with lots of customers so you can get his volume. Unfortunately I don’t think any broker is out there big enough to be even close to something useful when it comes to volume in FOREX.:slight_smile:
Happy Friday and keep on educated pip-guessing