VSA strategy: what happens if you combine levels and volume?
Only a lazy person doesn't know about the "VSA" trading strategy. Everyone has heard about the volumes on the market, and that these volumes can be managed. However, not everyone knows that the VSA strategy allows you to accurately enter the market. How? Read on!
As with most trading systems, in the "VSA" strategy, support and resistance levels are an integral part of the entire trading mechanism. It is at these levels that most often there are corrective price movements, as well as a reversal of the medium-term or even long-term trend.
These levels can also break through, and the price movement will continue to the next level. However, the VSA TC uses more than just support and resistance levels. These levels are related to exchange volumes. Using the relationship between volumes and support/resistance levels, it is possible to predict the upcoming price movement with a high probability.
Let's look at how you can use support/resistance levels and volumes to find a good entry point with minimal risk and good profit potential.
The chart below shows the AUD / USD currency pair on the H1 timeframe, where the number 1 indicates a high volume that "stopped" the price drop. This minimum formed the support level under the number 3. the Number 2 indicates the volume formed when the price re-approaches the support level (3). As you can see, with the repeated approach of the price (testing the support level), the volumes were significantly lower than those that "forced" the price to turn around.
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As a result, the price turned around and made a corrective movement of 1500 pips (5-digit quotes), while the stop order had to be placed below the support level by 100-150 pips. As a result, we got a deal with a risk / profit ratio of at least 1 to 10:
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Now let's look at one of the many cases when the price breaks through the level and continues its movement along the trend.
The chart below shows an example on the EUR/USD currency pair. Figure 3 – the resistance level that the price tried to break through several times on a high volume. Figure 1-breaking through the resistance level at a high volume. After that, we see the number 2-testing the broken level at a low volume. Then the upward trend continued. Just like in the first example, we were able to open a trade with minimal risk and a large profit potential.
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As you can see, using the support and resistance levels together with the exchange volumes gives the trader very good hints for entering a position.
Do you want to learn more "chips" on the VSA strategy? Then come to the open broadcast from the Forex Academy on the VSA strategy! The broadcast will take place on the Academy's YouTube channel.
What can you learn on the broadcast?
You will learn much more about VSA analysis and how to use it in the market. You will learn how support and resistance levels work in VSA analysis, and how exchange volumes are used in VSA.
In addition, you will learn how to cancel rebounds from support and resistance levels and independently find points after the breakdown of levels, which will allow You to enter the market as accurately as possible.
Just imagine: no incomprehensible terms, "muddy" sentences, confusion from unnecessary information in your head. In just an hour of broadcasting, You get an accurate scheme of actions in the market, which works itself out at 100%!
Sounds great, doesn't it? Then why waste time waiting for another opportunity?
Sign up for our broadcast right now and become a true professional in the foreign exchange market with the Forex Academy! Moreover, the broadcast is absolutely free! This means that You do not risk anything, while getting valuable knowledge in the field of trading in return! We are waiting for You, come!
To get to the broadcast, just click on the button below and submit your application. The Academy Manager will call you back and tell you how the training webinar will take place.