My only confusion is that I thought a test isn’t necessarily a bad thing, it just means they may have to come back to test that area again. However, I’m guessing that is only if it is a successful test on high volume i.e. next bar or two are upbars. The fact that this is high volume test with no successful bars following it and then a no demand for further weakness confirmation, shows evidence of a lot of weakness following the stopping volume.
Stopping volume -> failed test on high volume -> no demand = a lot of supply.
Supply entering -> successful test on high volume + no no demand = chance of still higher prices prices, although may move sideways for more testing.
Would you say that is fair logic?
Depending on whether we are short or long, we should be looking for demand/supply entering via stopping volume, then testing, then no demand’s or no supply’s for confirmation of reversal.
I think this thread has been unfair in its responses to my question. I understand fully how a reversal works using Pete’s method. I’ve read the entire 1500 page thread and watched all his videos numerous times. I am simply trying to get my head around the nuances of VSA so I can better interpret the bars following possible stopping volume. In it’s purest sense, know what phase you are in, then look out for stopping volume at fib areas/resistance/support, then tests and no demands/no supply’s with confirmation. Obviously, I’ve misread everything that has been written if that is not the case.
My previous post was not complicated, but I doubt any of you took the time to finish reading it.
I really don’t know what else to say. I’m incredulous.
Were you guys watching your 1hr chart? That is not stopping volume, the volume at the top is fair greater than the one at the buttom and remember we are in mark down phase.
“Part of me thinks there may be more supply to come” There you have it, don’t trade against your judgement
Stopping volume -> successful test on LOW volume -> no demand = Short
Supply entering -> failed test on HIGH volume + no no demand = chance of still higher prices
Yesterdays EU was perfect example of the first schematic.
I am to believe that a successful test on low volume means higher prices. A test bar drops lower then regains to close on its high. Low volume shows lack of selling as price went lower. Therefore, higher prices should occur from a low volume successful test, not a short. Correct?
I entered the same trade but only with 0.3% risk as we are in between the bigger 50-61.8 fibs. I closed out 3/4 on the 5 min 50 fib (very small profit though) and still have 1/4 running as intended to with SL at 1.3390.
SL hit. Well, I’m just glad I risked a small %, no harm done :). Since starting my account at IBFX I’ve had 83% winrate. My best trade is 145 pips and worst trade is 24 pips(made just now). I’m well aware that these results may change as my numbers of trades grow. But I’m kinda happy with the results atm
Yep, hence my mentioning “successful” test. Successful means the following bar(s) were up bars. A failed test would be one that does not respond with higher prices. I believe this is the correct terminology.
Yes I was aware of that, but the next 1 hr candle looked like supply was coming in aswell and there was like two ND’s. My % risk was very small too so I knew what I was going into. I usually don’t go for the riskier trades but today I did and I think my biggest mistake here was to not close out my whole position at the 50 fib, or atleast set it at BE. Instead I let the rest run with SL.
2Danny K: You actually still got lucky compared to me. I wanted to close my full position at fib 50, so I set my TP. The price missed it by 2 pips and then it went up. I let it ride hoping for the best so it’s 1% loss for me today.
2petefader: Thanks for your thoughts. I shoulda think about this trade a lilttle more. :33:
That’s old-day classic!
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