His name is Tom Williams and he always states what SPREAD means in his books. He notes that in England they call SPREAD what they call RANGE in the US. They are used to it and I think it doesn’t really matter. VSA never cares about what bid/ask spread is so there is no confusion really once you get used to it. 
Hey Clint,
Fine work with the hourly volume histogram. I usually don’t post on forums but have been stopping by here for years so unfortunately I can’t pm you. If you wouldn’t mind sending me a private message I would like to hear how you came up with the hourly data from the bis survey. Thanks.
Instead of a private conversation, I’ll post an explanation here on the Forum, later this week.
There is an article in FX trader this month explaining that statistically the tick volume is 90% accurate as a volume indicator even though it doesn;t show actual volume.
ALternatively, you can get the volume data from the futures market.
Thanks for that SanMiguel, it confirms what I look at on a daily basis and boy does it work, as far as I’ve seen the only people that say it don’t work and won’t work is the ones that haven’t tried it.
Here the link - http://www.fxtradermagazine.com/download.php?file=fxtradermagazine_9_eg.pdf it’s on Page 9.
Clint - They’ve just taken your idea and expanded on it, so you can claim - You saw it here first! Credit to you Sir.
Thanks Clint, look forward to it. Interesting article in FX trader magazine, something for the tick volume non believers to think about. If you don’t mind me asking, where do you get your tick volume purplepatch. I’m currently using esignal.
I’m using MT4 on Oanda, I’ve compared numerous, all very similar, but on the whole I find Oanda most useful.
Here is a cleaner chart of the Volume Histogram that I posted on this thread on March 6 (see post #39):
Here is some additional information on the methodology used to generate this chart:
As I mentioned in post #39, the BIS Triennial Survey gives us daily volume (turnover) figures for each of the several dozen countries in their comprehensive list. For the 31 countries I included in my analysis, I had to determine how to distribute each country’s total daily volume over a 24 hour period.
I chose a distribution which resembles a highly-modified bell-curve. Each country’s daily volume was distributed over the 24-hour day such that:
• approximately 83% of the daily total occurred during the normal business hours between 8am and 5pm, local time
• approximately 17% of the daily total occurred during the overnight hours between 5pm and 8am, local time.
I then used this distribution to divide each country’s total daily volume into 24 one-hour volume figures. Finally, I entered those 24 hourly volume figures for each country into a spreadsheet, based on that country’s GMT time zone.
This analysis included all the countries having total daily foreign exchange volume equal to or greater than New Zealand (9 billion USD per day), as reported in the BIS Survey (see Table B.8, page 19). There were 31 such countries as of the April 2010 survey period, so my spreadsheet contained 31 lines of data, distributed over 24 columns representing 24 hours of the day. Those 24 columns were totaled, and those totals (adjusted, as described in Note 1, below) comprise the 24 bars of the histogram, as posted in this thread.
Here is some additional detail.
1. The BIS Triennial Survey reports volume (turnover) calculated in three different ways, depending on context:
• Gross volume is volume as reported by central banks, without adjustment for local or cross-border double-counting
• Net-gross volume is gross volume adjusted to eliminate local double-counting
• Net-net volume is net-gross volume adjusted to eliminate cross-border double-counting
See Note 3, below, for an explanation of how and why each of these volume measures is used.
The BIS Survey reports NET-GROSS volume for each country. Totaling ALL the net-gross figures reported in the Survey, yields a world net-gross total of 5.056 trillion USD per day. Totaling the net-gross figures for the 31 countries included in this analysis yields a net-gross total of 4.965 trillion USD per day (98.2% of the world net-gross total).
But, we know (from the Survey) that the true measure of world volume is the NET-NET figure of 3.981 trillion USD per day. So, I applied a factor of 0.80181 to each of the 24 bars of the histogram, in order to adjust the total of the 24 bars to 3.981 trillion USD per day.
2. Here are the 31 countries having net-gross foreign exchange volume of 9 billion USD per day, or more, as reported in the BIS 2010 Survey, listed by time zones, from east to west, beginning at the International Date Line. Note that these time zones correspond to northern hemisphere winter-time:
PACIFIC
(GMT + 13) — time zone is GMT+12 plus 1 hour adjustment for southern hemisphere DST
New Zealand — 9 billion USD
(GMT + 11) — time zone is GMT+10 plus 1 hour adjustment for southern hemisphere DST
Australia — 192 billion USD
ASIA
(GMT + 9)
Japan — 312 billion USD
Korea — 44
(GMT + 8)
Singapore — 266 billion USD
Hong Kong — 238
China — 20
Taiwan — 18
INDIAN SUBCONTINENT / EURASIA / MIDDLE EAST / SOUTH AFRICA
(GMT + 5.5)
India — 27 billion USD
(GMT + 3) — time zone refers to western Russia (Moscow, St Petersburg, etc.)
Russia — 42 billion USD
(GMT + 2)
Turkey — 17 billion USD
South Africa — 14
Israel — 10
EUROPE / U.K.
(GMT + 1)
Switzerland — 263 billion USD
France — 152
Denmark — 120
Germany — 109
Sweden — 45
Belgium — 33
Luxembourg — 33
Finland — 31
Italy — 29
Spain — 29
Norway — 22
Austria — 20
Netherlands — 18
B[/B]
U.K. — 1,854 billion USD
Ireland — 15
NORTH AMERICA
(GMT - 5) — time zone refers to the eastern U.S. and Canada (New York, Toronto, etc.)
U.S. — 904 billion USD
Canada — 62
Mexico — 17
Total for 31 countries in 10 time zones: 4,965 billion USD per day (98.20% of world total)
3. As mentioned above, there are three different measures of volume (turnover) reported in the BIS Survey, depending on context. Basically, GROSS VOLUME is the correct measure of volume to use in describing the turnover of a bank; NET-GROSS VOLUME is the correct measure of volume to use in describing the turnover of a group of banks, of a region, or of a country; and NET-NET VOLUME is the correct measure of volume to use in describing total world turnover.
The easiest way to understand these three different volume figures is to imagine that all of the world’s foreign exchange volume is handled by just 4 banks in 2 different countries: let’s say Bank A and Bank B in the U.S., and Bank C and Bank D in the U.K.
Now, let’s say that each bank does 1 billion USD per day in volume with EACH of the other 3 banks. In this case, each bank would report 3 billion USD per day in volume to the BIS; this would be gross volume.
However, U.S. volume would not be 6 billion USD (the total of Bank A + Bank B), because Bank A and Bank B both reported the same 1 billion USD that they transacted with each other. So, “local” double-counting of 1 billion USD has to be removed from the U.S. total, making the net-gross volume figure for the U.S. = 5 billion USD per day. Similarly, the net-gross volume figure for the U.K. would also be 5 billion USD per day, after adjusting for the “local” double-counting of 1 billion USD between Bank C and Bank D.
So, in our hypothetical example, each bank did gross volume of 3 billion USD per day; and each country did net-gross volume of 5 billion USD per day.
However, total world volume would not be 10 billion USD per day (the total of the U.S. + the U.K.), because both countries reported the same 4 cross-border transactions. So, “cross-border” double-counting of 4 billion USD has to be removed, resulting in total world net-net volume of 6 billion USD per day.
Hey Clint, thanks for taking the time to put this together.
Sorry to bump an old thread.Just that i think its so stupid for people to state FX volume is worthless because it doesnt show volume.
Let me ask you this. What is so special about knowing the amount of Volume at a given time? nothing special
What is the difference in value between knowing the volume and Activity at a given time?
Volume is activity in FX.Its simple. I mean JESUS. All you need to do is look at a break of support/resistance and see the high “activity” in that candle to know various clues about what is going on.
So I say Who cares if it doesnt show Volume… what it shows is just as useful…
To add…
No one is saying that the Volume indi is 100% all you need. You cannot deny that it shows some valuable info in regards to how active the market is at a given time. And to be honest. You MA’s and Stocks shows bugger all compared to Volume activity data in regards to usefullnes. Do yourselves a favor and use Volume.
The you go Epidot, seek and thee will find! Hope this helps - http://www.purplepatchforex.co.uk/FxTraderVolumeArticle.pdf
For what it is worth volume provided by any broker is inaccurarte, there is partial credibility in following the CME futures perhaps as a strategy confirmation however if you are using volume as a part of a core stratgy then you stand a greater chance of losing. Learn to trade Forex without it is your best plan.
Why do the ones that don’t trade VSA feel they need to attack it?
…
He’s just repeating what’s he’s been told, without looking into it himself…would be my guess.
Well yes, we know where the proof is!
VSa is great for FX. Pete has already proved this in about what… a billion pages of trades. Enough said
Thanks PPf for the link I will read now. Already skipped to the end which it says there is a high correlation and that volume data in FX is usefull.
Be honest with yourself here. Why do you think a brokers volume info is inaccurate? Because they only use info based on the volume of orders they are getting. Well if you use a major broker that the majority of others are using then how is it inaccurate? Because the number will vary from broker to broker. Well so does price. If price varies from broker to broker that means that 50 EMA is wrong along with every other indicator out there. Hell even your candle sticks are wrong. So we all might as well hang up or hats. Look I dont know crap about VSA. I have been meaning to get on petes thread to learn it but procrastination is a Mother F%&@er. I use mainly price action in my trades but I will never say VSA is crap. I tend to believe any thread on here with that many pages hold credibility. I know I have learn alot from them and have traded profitably. I want to learn VSA to add yet another great weapon to my arsenal of weapons I already have.
I am always honest with myself especially. Do you see the institutional volume or the lower end retail volume? If you cannot see the former (Which I know to be true) then don’t try to guess the latter because it is misleading. Even the BBC says your Broker is your ***** so its best not to trust him and his IT development stop hunting cronies.