FEATURES

  • High volume bars – many times these coincide with something significant happening in the market, such as a trend reversal or continuation
  • Low volume bars – they indicate a temporary lack of demand/supply in the market
  • Churn bars – these often appear before a trend reversal
  • Thrust bars – these are manouvers to get stop-losses, and at the right place, can be a confirmation of strength/weakness in the market
  • Strong and Weak Tests – bars which test the supply/demand in the market; if successful, the trend can procede, if not, it’ll reverse
  • Up close/Down close bars – bars which have a higher close than the bar before or a lower close, respectively
  • Paints chart’s bars optionally, for an easier visualization (using Color Bars indicator)
  • Plots a moving average computed using session volumes (London/NY and Tokyo)

 

Volume Trading EURUSD M30  Volume Candles USDCAD Tick Volume Histogram AU Volumes Forex USDJPY

Types of Volumes

High Volume Bars

These will often define what’s going to happen next, when analyzing the price in conjunction with the volumes. Major tops and bottoms in the market will often be made on high volume, in what’s called an accumulation or distribution process (professional buying/selling respectively). A wide range bar with high volume, closing on its highs, is a bullish bar, signaling a trend continuation (vice-versa for bearish bars).

 

Low Volume Bars

Low volume bars indicate either a temporary lack of demand/supply in the market. These are often good entry spots after significant demand (or supply) has been seen.

 

Churn Bars

These are price bars that have a narrow spread (or range, which is the difference between the bar’s high and low) and high volume. Bars like this often denote supply as the smart money prevents the price from moving further by dumping sell orders into the market – that’s why it has a narrow range and high volume (vice-versa for demand patterns, after a market downtrend). Because of this, they often show up before market corrections and significant trend changes.

These are more significant is the market is making new highs or lows, so that the high volume doesn’t come from locked-in traders waiting to get out at a profit or break-even in a former support/resistance.

Thrust Bars

Upthrusts are bars which, at the right place, can be a confirmation of weakness in the market (vice-versa for downthrusts, in a market bottom). They’re maneuvers to get stop-losses and stop orders, as well as to test the supply/demand in a given price level. They have more meaning when they appear:

  • Near a support/resistance
  • Near a price area where there was previous supply/demand
  • On new highs/lows in the market

 

Supply Test/Demand Test Bars

Test-like bars are bars that when at the right place, they’re either testing the supply or demand in the market. There are 2 factors to consider when a test bar appears.

1. Testing an important area

It must appear in the same price zone as a previous:

  • Demand/Supply in the market, marked by Analytical VSA Trader
  • Very high volume/high volume bars, marked by red/violet volume histograms
  • Support/Resistance or Trendline

If price isn’t in any of these critical areas, test-like bars shouldn’t be considered real tests and should be dismissed.

2. Success/failure of tests

  • A supply (bullish) test is successful if the prices rally in the next few bars afterwards; failed otherwise
  • A demand (bearish) test is successful if the prices downtrend in the next few bars afterwards; failed otherwise

 

 

 

Charts

 

Volumes Trading EURUSD H1 Volume Bars USDJPY M1 Tick Volumes GOLD Volumes Trading EURCAD