Monthly Archives: September 2010

Volume Dead Zones And SMART VSA (Volume Spread Analysis)

Posted on by pipbuilder
Often people learning VSA or using our own Volume Spread Analysis Software SMART ask questions about trades that didn’t work out and why.  Obviously not everything is 100% but understanding an often overlooked and simple concept (Dead Zones) can have a dramatic effect on your Volume Spread Analysis and nine times out of ten is why a pattern (even very strong ones) fail. 

Take a look at the following chart (used earlier as well to identify hidden selling and hidden buying) for some quick examples.  (If you use SMART simply scroll back through your charts and looks for these dead zones and how the smart signal behave in those areas)

 

Volume Dead Zones And SMART VSA (Volume Spread Analysis)

 

Text from screenshot:

 

VSA Dead Zones And How To Interpret Signals Ouside and Within These Areas:

 

A Dead Zone is any area on your chart where volume is significantly below normal or below average.

 

Volume Spread Analysis and SMART VSA patterns should be used with caution within these areas.

 

0. Various VSA Signals Both Inside and Outside of Dead Zones

 

1. SMART Blue Bar (Reverse Upthrust – Strength) The signals happens within a dead zone and you can see price meanders for quite a while (H1 Chart)  It does generally go in the direct you would expect but it takes a while for any significant movement.

 

2. SMART Orange Bar (Supply Coming In – Weakness) Here the signal happens outside of the dead zone area and you can see the expected movement as a result is much quicker.

 

3. This is the same signal as #1 (Strength) but happens during healthy volume.  You can clearly see the difference.

 

4. Advanced Spinning Rowboat as well as a standard Upthrust (Weakness) during a Healthy Volume Area.

 

You can see from the examples Volume Spread Analysis is a very powerful trading method but you must be aware of, and use caution trading in low volume (dead zone areas) if you want to trade VSA successfully.

 

A Dead Zone Module for SMART is planned for a future update as is our SMART Volume Module.

 

Please keep in mind SMART Trader itself is painting these bars which makes these patterns and setups much easier to spot and act on.
These patterns repeat themselves day in and day out and using SMART you can clearly see not only standard VSA signals but our advanced multibar SMART VSA patterns as well.
Trade setups are verified using our proprietary background scanners (included with the system).
For more information or if you have any questions about SMART Trader Volume Spread Analysis (VSA) Software please visit
SMART Trader at pipbuilders.com or visit our Live and Free VSA (Volume Spread Analysis) Chat and Trading Room at http://vsa.pipbuilders.com
Good luck trading and see you in the chat.

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Correctly Identify Hidden Selling and Hidden Buying Using VSA (Volume Spread Analysis) and SMART VSA

Posted on by pipbuilder

Many people in the live chat and pm’s ask how to correctly identify hidden selling and hidden buying and how to distinguish these patterns from similar patterns such as market top (which looks like hidden selling if not using SMART).  The following screenshot is from the H1 Globex GBP and is illustrated in Real Time perfectly using SMART.

 

Correctly Identify Hidden Selling and Hidden Buying Using VSA (Volume Spread Analysis) and SMART VSA

 

Text from screenshot:

 

Identifying Hidden Selling/Buying Using Volume Spread Analysis with SMART VSA

 

1. Valid Reverse Upthrust or Blue SMART Bar (strength)
2. Valid Upthrust or SMART VSA Spinning Rowboat SMART Firebrick Bar (Weakness)
3. Hidden Buying*
4. Looks like hidden buying but is actually a Market Top Indication or SMART Crimson Bar. (easy to see the differences using SMART just roll over it with your mouse)
5. Hidden Selling (Weakness)*
6. Hidden Buying (Strength)*
7. Hidden Selling (Weakness)*

 

Hidden Selling or Buying is seen as a Pseudo Upthrust after a widespread Downbar bar (Strength) or a Pseudo Reverse Upthrust following a widespread UP bar.

 

For the purposes of this example only the modules needed to illustrate hidden selling and hidden buying and the difference between those signals and other similar looking signals are shown.

 

*A Hidden Buying and Hidden Selling Module will be included in a future update so the colors identifying them using SMART will change. 

Please keep in mind SMART Trader itself is painting these bars which makes these patterns and setups much easier to spot and act on. 

These patterns repeat themselves day in and day out and using SMART you can clearly see not only standard VSA signals but our advanced multibar SMART VSA patterns as well. 

Trade setups are verified using our proprietary background scanners (included with the system). 

For more information or if you have any questions about SMART Trader Volume Spread Analysis (VSA) Software please visit
SMART Trader at pipbuilders.com or visit our Live and Free VSA (Volume Spread Analysis) Chat and Trading Room at http://vsa.pipbuilders.com 

Good luck trading and see you in the chat.

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220+ Pips on GBPUSD Using SMART VSA (Volume Spread Analysis)

Posted on by pipbuilder
Here is a quick chart illustrating how just a few simple but powerful VSA signals combined with SMART VSA can be very successful.

 

2010-09-14_2023.png
Text from screenshot:

GBPUSD Hourly Chart Using Simple VSA (upthrusts and reverse upthrusts) and some Advanced VSA (Advanced Strength and Weakness Module) only

 

1.Reverse Upthrust (Blue SMART Bar)

 

2.Upthrust (Spinning Rowboat as well)
followed by multiple signs of weakness.

 

3. Advanced Strength Indication

 

Altogether these moves accounted for 220+ pips going signal to signal.

 

This is an illustration how just a couple of strong VSA signals paired with our own advanced VSA indicators can be traded successfully.

 

Please keep in mind SMART Trader itself is painting these bars which makes these patterns and setups much easier to spot and act on.
These patterns repeat themselves day in and day out and using SMART you can clearly see not only standard VSA signals but our advanced multibar SMART VSA patterns as well.
Trade setups are verified using our proprietary background scanners (included with the system).
For more information or if you have any questions about SMART Trader Volume Spread Analysis (VSA) Software please visit
SMART Trader at pipbuilders.com or visit our Live and Free VSA (Volume Spread Analysis) Chat and Trading Room at http://vsa.pipbuilders.com
Good luck trading and see you in the chat.

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Quick AUD/CAD

Posted on by pipbuilder

I haven’t posted in a bit as we have been busy planning out some updates.  A person in the live VSA chat asked that I post up a quick AUD CAD.  Analysis is during what I call a dead zone (SMART Module coming soon) but I figured I would post it up here as well for those not in the chat. .

2010-09-14_1723.png

 

The price was cut off in the screenshot.  The price was 96.42

 

Please keep in mind SMART Trader itself is painting these bars which makes these patterns and setups much easier to spot and act on.
These patterns repeat themselves day in and day out and using SMART you can clearly see not only standard VSA signals but our advanced multibar SMART VSA patterns as well.
Trade setups are verified using our proprietary background scanners (included with the system).
For more information or if you have any questions about SMART Trader Volume Spread Analysis (VSA) Software please visit
SMART Trader at pipbuilders.com or visit our Live and Free VSA (Volume Spread Analysis) Chat and Trading Room at http://vsa.pipbuilders.com
Good luck trading and see you in the chat.

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Background Scanner Issues And Comments

Posted on by pipbuilder

A valid point was raised by one of customers, one which has been addressed many times in the chat room as being an issue that will be fixed in the next update.  I would like to reiterate it here for those that may have missed it and also update what changes are coming in the future with regards to the background scanners as these are possibly one of the most confusing things in VSA for most people starting out (and pros too).

First the issue with the Background scanner in SMART and how we are addressing it.  In the current background scanner smart does not take an extreme volume Effort To Rise (green bar) as weakness but rather as a normal Effort To Rise and marks it as strength (the opposite is true for an Effort To Fall).  If in the range scan any ETR (or ETF) happens, the calculations for determining if there is weakness or strength in the bg may be off slightly. This reading can also be effected by things such as the previously mentioned dead zones.

This is an easy fix and will be in our next update.  We are also expanding on this a bit and planning for future changes such as Dead Zones and accounting for them in the calculations as well as a visual Background scanner so you can see where and when the bg is changing on the chart in real time.

Some people are confused by what it (the background) is or even how to trade the background in VSA with or without SMART.  What most seasoned VSA traders do (Todd Krueger for example) is look to the shorter time frames (yes shorter) for when the background is changing, as small changes in the these time frames make much larger swings later in the longer time frames.  

One way SMART helps with this is by allowing you to see all the background changes for multiple time frames on one chart using the Multiple Time Frame Background Scanner.

Once they have all switched to one direction you can safely start looking for changes the other way and counter trades in the opposite direction starting again with changes to the shorter time frames.  

In other words If the SMART BG Scanner says strength that does not mean necessarily to only look for long indications only.  The immediate background is in my opinion much better for that type of analysis.  I personally use M15, M30, and H1.  Feel free to experiment with whatever combination works for you.  

If you have any questions or are confused by any aspect of VSA or SMART please feel free to contact me via the live chat or submit a support ticket via our website.

For more information or if you have any questions about SMART Trader Volume Spread Analysis (VSA) Software please visit 
SMART Trader at pipbuilders.com or visit our Live and Free VSA (Volume Spread Analysis) Chat and Trading Room at http://vsa.pipbuilders.com

 

Good luck trading and see you in the chat.

 

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