VSA Chart Analysis Discussion Thread

[tech/a]

Yes.
Just Data mirrors yours.
With a nasty pivot point reversal on intraday data at hand.

Still doesnt alter the analysis.Other than the consolidation looks more likely.
Volume is poor which is a positive sign in this case---little supply.

 

[Mistagear]

Update on the AQA chart.

The gap open is an entry signal for me in this particular situation (on the back of previous bar analysis). 608c
Initial stop on entry was equal to a close of the previous bar's open @ 580c, theory of this is .. if price closes back down at the open of the high volume bar which I rated as demand, with price having now gapped up, a close lower would signal the analysis incorrect and therefore an exit required.
Short term target on this swing is a window 652c/659c.
Reason is past S/R level already shown on previous chart and the current swing volatility of this stock.
Risk 28c, reward target 44c/51c. Not quite the ratio I look for so is slightly outside my plan
Will monitor as we approach the short term target to gauge whether to take some or all of the trade off the table.
The positive close today 635c, has seen me lift the initial stop to B/E 610c trigger.


VSA aspects today.
Gap open then the first lot of open trades took price to 620c, washed out new supply back to around 11am where a couple of vol spikes did not push price lower, another few minutes for the market to digest the now exhausted supply resulted in price starting to move up again. Strength shown with shallow retraces to 12o'clock then a demand push through supply with price to 633. Demand stalled (low vol) around 12.15pm. Bit of a stand-off until 2pm where supply had a poke at the demand and found strength in the form of high volume short range down bars.
After that the only push down bars were lower volume that the demand push up bars, to me that is continuation of the new trend is the least resistance, price continues.

Will keep this going until the trade has cancelled itself.
Criticism on any aspect welcome.

Cheers, M

 

[tech/a]

AQA

Couldn't see a trade in it.
Nice move to B/E
Now it can do as it pleases without risk.

 

[skc]

Yes.
Just Data mirrors yours.
With a nasty pivot point reversal on intraday data at hand.

Still doesnt alter the analysis.Other than the consolidation looks more likely.
Volume is poor which is a positive sign in this case---little supply.

Thanks. With SIP a reasonable value range imo is ~58-62c. So a consolidation there makes sense. Anything higher requires much optimistic assumptions which are probably not warranted in the current market.

Interesting to see if my 2-minute fundamental valuation pans out on the chart or not.

 

[Mistagear]

Hi

AQA trade disqualified itself today. The negative sentiment across the market plus the volume patterns following the lower open convinced me to scratch the trade.
Closed @625c 12.40pm bar.
Reasons.
Lower open and failure to recover,
Lack of demand at the 10.45am, (1st circle)
supply evident on the 11.25am bar (2nd circle).
continued lack of demand 12.05pm and volume associate dw price decay (3rd circle).
The 12.30 bar see supply into the support, then 12.35pm bar again showd no desire to push through supply, weight of evidence against the trade...exit (4th circle).

Towards the close you can see there waw some demand prepared to stand in-front of the dump of supply, some of this probably due to the gap closing on the daily as well as the round number level adding to the demand. Supply ran over the top of supply too easily for me to risk catching the falling knife.
Currently have a buy stop above the market to cover an instant reversal of price tomorrow, however I favour waiting for the fresh supply to wash out of the stock.

This was proven to be a poor example of Volume analysis on my part.

Cheers, M

 

[Billyb]

Hi
This was proven to be a poor example of Volume analysis on my part.

Cheers, M

VSA analysis was fine IMO, I think it was just a risky trade - trading anything long right before resistance (even if it is a gap up) is always gonna carry some risk

 

[Mistagear]

VSA analysis was fine IMO, I think it was just a risky trade - trading anything long right before resistance (even if it is a gap up) is always gonna carry some risk

Hi Billy,
I dont especially consider risk a factor in this case, risk/reward was (I thought) realistic, as per my normal ratio and therefore no different to any other trade I take. Money management controlled the risk and actually made profit on the trade.
The reason I called it a failure of analysis can be seen on this revised chart.

The previous chart (posted15/9/11) concentrated mainly on reasons to enter, the next post was trade management subject matter.
Some additional background on why I call it a failure of analysis contained in the following chart, centred on expectation of achieving the nominated target in the risk/reward calculation
I estimated the amount of supply towards the first target (nominated at $6.50) would not present sufficient resistance to reverse direction before the target. This was based on past price and volume action within the zone.

Late July showed abundant supply in the $6.70 region, not as much below that.
The last rise originating 23/8 from a swing bottom similar in volume and starting point to this most recent one, made the $6.50 price on relatively low supply.
You can say was on low demand, but the feature I was looking at was the low supply at the top of the swing and limited chase lower as price fell away..
This was the reason I assumed low resistance would repeat .
Additional volume on the 15th then gap open and price advance on 16th led me to believe price would continue to target.
On the chart I marked a 3 wave line where I suspected price might track.

The reversal open and sell down on the heaviest supply day since 8th August was very much unexpected, based on all my previous price and volume analysis.
That is the where the failure lies.

Cheers, M

 

[tech/a]

M/G
Don't know if this will be helpful but I look for the following when assessing a trade triggered in consolidation.

(1) Extreme volume as in high
OR
(2) Extreme volume as in low.

If there is neither then chances are it will remain in consolidation.
It's where these extremes occur that hint of what's coming.

The only low risk trade I see on this chart is a position trade at the bar breaking well low of the now obvious consolidation.The extreme of volume day.
The rest I didn't and still don't see a trade.

I'll see if I can find a working example--- tied up most of the day though and an early start

 

[Mistagear]

M/G
Don't know if this will be helpful but I look for the following when assessing a trade triggered in consolidation.

(1) Extreme volume as in high
OR
(2) Extreme volume as in low.

If there is neither then chances are it will remain in consolidation.
It's where these extremes occur that hint of what's coming.

The only low risk trade I see on this chart is a position trade at the bar breaking well low of the now obvious consolidation.The extreme of volume day.
The rest I didn't and still don't see a trade.

I'll see if I can find a working example--- tied up most of the day though and an early start

Tech/a,

I understand your statement, in fact the only criteria I scan for on a daily basis (for the last couple of years ) is extreme low and extreme high of volume.
(Volume 70%> 50MA and Volume 70%< 50MA with some minimum levels on av vol to filter out illiquid stocks).

Like you, extreme low volume events command considerable respect in my trading.

Resulting from above scan I did trade the price extreme you mentioned and took the trade off when price reached the 2x ATR target created from the signal day, 9th Aug
Since then, the consolidation has shown some signs of a possible Wyckoff Creek forming.
My first post for this chart prior to it gapping up, I had on watch for an approx 2x ATR thrust lower with an immediate reversal.
I normally look for an extreme vol event signalling supply exhaustion and had hoped to show the set-up develop as example of VSA in progress.
Whilst the set-up I had hoped for did not eventuate, the following day when price was opening higher, I joined the buyers at open with the possibility this was a "Jump Up" out of the creek.
Sure this is normally after greater accumulation across the lows which was not as evident in this case. Perhaps the fact that obvious accumulation has not occurred as yet may have something to do with how price was pushed back down as decisively as it was. If there is some operator conducting a campaign, the stock jumping early would not be in his favour and therefore he would need to add supply to suppress price again.

I appreciate your continued attempts to help traders like myself by highlighting your volume methods and happy to accept your critiques on trades I post.

Cheers, M

 

[tech/a]

This is the 5 min SPI.

This is a Common reversal seen on most charts.
Worth looking for.


Infact there is one right now on the chart at 3918
Indicating a reversal here into close.

 

[tech/a]

That one failed.

 

[skc]

This is the 5 min SPI.

This is a Common reversal seen on most charts.
Worth looking for.

Infact there is one right now on the chart at 3918
Indicating a reversal here into close.

Didn't work. 2 out of 3 ain't bad I guess :

 

[tech/a]

Like everything they are a setup.
I find them low risk with good R/R

 

[sammy84]

Tech

Mind giving me your option on LLC?

To me it looks like stopping volume occurring at decent area of support.

Click to expand

 

[tech/a]

SAMMY

A little technical forensics.

While you have a strong case for some short term support
Its certainly clear on the 60min chart.---BUT notice all the RED indicators weakness
in the background!
As you can see by the weekly chart ---I feel this maybe short lived.

So going forward I would suggest some up side of approx $1.50 ish if that
before a resumption to the downside.While this trade is probably there its not one that I would trade. There hasn't been any signs of resuming strength other than this daily bar--of late.

 

[Billyb]

Agree with Tech, might just add a couple of cents


that last day is indeed a strength bar but you wouldn't even consider a long position yet because it really is just one isolated bar. VSA like all analysis is not about forecasting it's about skewing probability in our favour. You would have to wait for a lot more confirmation before you could take a low risk/high probability entry. But more important is the overall market trend, which is clearly down, so taking a long position is pretty risky.

 

[sammy84]

SAMMY

A little technical forensics.

While you have a strong case for some short term support
Its certainly clear on the 60min chart.---BUT notice all the RED indicators weakness
in the background!
As you can see by the weekly chart ---I feel this maybe short lived.

So going forward I would suggest some up side of approx $1.50 ish if that
before a resumption to the downside.While this trade is probably there its not one that I would trade. There hasn't been any signs of resuming strength other than this daily bar--of late.

Thanks Tech.

Good learning points there. You also show the importance of have intraday data to tell a properly analyse. Wasn't interested in trading this so much. Need some more confluence of patterns and the index before I would consider a counter trend trade.

 

[tech/a]

And here it is once again.
This is a 1 minute chart followed by a 5 min chart which confirms the reversal with another bar pattern.SPI

CLICK TO EXPAND





What do you think should be considered at the RIGHT hand edge of the page?

 

[joea]

Hi.
For those people interested in VSA, Lauren Snedeker has just given a webinar on "How I learned VSA - A Beginners Point of View" Part 1. A Part 2 is coming on 5th October.
I watched a recording.
from Tradeguider.
Cheers joea

 

[mr. jeff]

And here it is once again.
This is a 1 minute chart followed by a 5 min chart which confirms the reversal with another bar pattern.SPI

CLICK TO EXPAND

View attachment 44721

View attachment 44720

What do you think should be considered at the RIGHT hand edge of the page?

Sell short
Although there was a clear reversal in the 1 minute chart, looking further back there is resistance at the current level and the bars closing in the middle looks like a short term sign of weakness with supply present.

?