{"id":13591,"date":"2020-09-18T11:30:25","date_gmt":"2020-09-18T09:30:25","guid":{"rendered":"https:\/\/ftmo.com\/?p=13591"},"modified":"2022-01-11T17:56:13","modified_gmt":"2022-01-11T16:56:13","slug":"volume-spread-analysis","status":"publish","type":"post","link":"https:\/\/ftmo.com\/en\/volume-spread-analysis\/","title":{"rendered":"Volume Spread Analysis – Trading the VSA"},"content":{"rendered":"

In this article we will introduce the famous Volume Spread Analysis (VSA) system that uses the very foundation of market behaviour.<\/em><\/p>\n

Volume Spread Analysis<\/h2>\n

The foundation for this system was laid by Richard Wyckoff, the legendary trader, who supposedly earned a fortune with this system. In the 1970s, this system was taken by Tom Williams, who developed it into its present form, popularize it and named the system Volume Spread Analysis. According to the author, this system applies to all time frames and all markets, where we have high quality data feeds.<\/p>\n

Before we discuss the individual entry patterns, let\u2019s first consider whether we can use this system on a decentralized forex markets, where the traded volume is inaccurate. Below is a comparison between the futures exchange platform, which shows the exact data directly from the exchange and the MetaTrader 4 platform with inaccurate data.<\/p>\n

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It can be seen from the picture that the volume is proportionally the same. It can be assumed that we can apply this system also for forex markets.<\/p>\n

The basic premise of the system is:<\/p>\n

VSA looks for the cause of the price change in the imbalance between supply and demand caused by Smart Money.<\/strong><\/p>\n

VSA has these variables:<\/p>\n

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Spread of an candle<\/p><\/div>\n