Volume Spread Analysis

Placebo

Placebo

Well-Known Member
#201
#201
Hi Bizcon. If there was a counting system or looking at only X number of bars then VSA would be a mechanical system.Although it can be combined with Nr7 and Wr7 which is a mechanical system. Whereas VSA is logical understanding of the market (not a system) which finds the footprints of manipulator's.

Unfortunately there is no distinctive answer to your question. At least i don't have one. And as far as the entry point is concerned you have to find a point where there is maximum imbalance in demand/supply while keeping the background in mind.


Cheers
 
R

raven4ns

Member
#202
#202
Hello,
What exactly do you mean by background? I have seen this term many times but no explanation of precisely what you are trying to assess. Thank you.


Tim

1.Assessment of Background is more important than anything else.
2.This will help you in understanding the trend of the market.
3.Once the trend is understood look for confirmation.
4.Once confirmation is seen try to find your place in the trend (entry point ) and then see if you belong in the trend (if the stop is too wide and makes you feel uncomfortable then do not enter).
5.Just before taking the position the final confirmation for an entry point should come from a higher time frame. If not then wait for a while.

Cheers[/QUOTE]
 
Placebo

Placebo

Well-Known Member
#203
#203
"Your daily decisions are based on your background information and only partly on what is happening today.If you won the lottery last week ,yes,you might be buying a yacht today ,but your decision to buy a yacht today will be based on your recent background of financial strength appearing in your life last week.The stock market is the same.Today's action is heavily influenced by recent background strength or weakness,rather than what is actually happening today" Tom Williams - Master The Markets Page 19

There are several others things which are written about the background however this stands out.

The background interpretation could differ from person to person so i'm not getting involved in explaining my point of view of looking at the background as your interpretation could be totally opposite of mine and that would just create confusion.

I'm not too sure but i think that bunny has posted the download link on one of these pages. If possible read the book.

Cheers
 
bunny

bunny

Well-Known Member
#204
#204
lnangia said:

I'm not too sure but i think that bunny has posted the download link on one of these pages. If possible read the book.
Click to expand...
Its a 20 MB PDF file. Right-click here and select "Save as".

As about the background its definition as well as perception is subjective and varies widely among people. My working definition is that the 2 or 3 most recent bars are good to be considered as background. These bars become significant if there are some important events like:
  1. Test of supply on a downday
  2. Upthrust on an up-day
  3. Narrowest/widest range bars with volume indications
  4. Push through bars
  5. Making new immediate-term(min. 4 bars) low on up-days
  6. Making new immediate-term(min. 4 bars) high on down-days
  7. Is the price approaching any trend line?
 
R

raven4ns

Member
#205
#205
Thank you bunny for the download and the explanation. I wanted to understand the meaning of "background" and what it might entail. The interpretation of the data is for each of us to discern for ourselves. Thank you again.

Tim
 
bunny

bunny

Well-Known Member
#206
#206
In this PDF I have mentioned some important events that one must look at while reading a chart from VSA perspective.

Right-click here and select "Save as" to download the file. Filesize is about 32KB.

Comments welcome.
 
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