VSA + Congestions in Pound (Market Analysis)

The Pound has been showing strength in the volumes lately, on the major pairs, with congestions showing a demand zone being formed at these prices.

 

GBPUSD

In GBPUSD the prices just bounced off the demand zone, which were the first long signal, due to the strength behind. The target is at 1.326, from where a breakout can be traded on a lower timeframe. Alternatively, if there is a correction onto 1.319 on low volume, there can be another long opportunity.

VSA + Congestions GBPUSD

 

EURGBP

EURGBP is showing some selling behind, which is good for the GBP. A trendline break would give a trend changing confirmation, for a short trade.

 

VSA + Congestions EURGBP

VSA + Congestions EURGBP

 

GBPJPY

GBPJPY is ranging for a longer time than GBPUSD, and didn’t go down as much as GBPUSD did recently. There is buying behind showed by VSA and congestion bars, along with a strong congestion zone. The plan is to look for a trendline break.

GBPJPY H1

 

EURUSD’s Market Top – Analysis with Prices and Volumes

Dynamic trend: Turned up

Background: W1 – weak; D1 – weak

Phase: Markdown

Selling In EURUSD

Selling In EURUSD

 

In point 1 there was an up bar with a very wide range and high volume. The next bar was a down-bar, which indicates the predominance of sales over buying on the previous bar. VSA also identified selling in this area.

In point 2 and 3 – a series of “Up-Thrusts”; in point 3 the bar with a very wide spread and high volume, which emphasizes bearish interest from the smart money.

In point 4 there was a combination of reversal bars. The first bar was up-bar with a very high volume and wide spread, but close price was in the middle of the bar, which indicates supply. The second bar had a very high volume also, and it confirmed the sales on the first bar as it closes below the minimum. Subsequent downward movement was on low volume, that showed a lack of demand. Analytical Trader also identified selling in this area.

In point 5 these was a confirmed “No Demand” – a great point for a short.

 

Suggested Strategies

In the mid of the range it’s not recommended to trade. Consider a short if the price approaches the level of 1.13 and «No Demand» bar appears.

You can search «No Demand» and «No Supply» on the lower TF.

Yen’s Rally after Accumulation – What to Do Now?

On the previous week post about the Yen, we noticed that there was consistent buying in the hourly chart, and that a dip into the lower part of the range would give a long opportunity. This happened, and right in the next London session!

On trading ranges showing VSA buying signals, like we note on the trading guide, you can also wait for a breakout of the trading’s range high. If on the break, the volumes pick up, it’ll be a confirmation of accumulation. This is what happened in USDJPY, and since then, it has been on a long rally, until stopping on a long-term trendline.

Apart from the down trendline, the momentum of the uptrend is now fading, and there is significant supply showing up. This is inevitable on resistance areas, but still, if you’re holding a long in intraday, this is a good time to start reducing the position size, and wait for a trendline break to add into. Personally I’m holding a long daily trade, and waiting to see how the daily bar closes.

If the trendline is broken, it’ll be a long/adding signal. If supply keeps showing up on the hourly, and/or there are low volume rallies into the current selling bar, it’ll be a short signal.

Trading Range USDJPY

EURUSD Multi-timeframe Analysis – Downtrending after Distribution

EURUSD H1 Distribution Markdown EURUSD H4 Distribution Top

 

According with the previous analysis, the volume’s “type” changed from demand to supply. Also, according with the previous analysis, on the level of the breakdown of 1.124 it was a great opportunity for sell on TF M15 with ratio risk: profit of 1:4.

In point 1 there was a combination of turning bars, which together can be seen as “Up-Thrust”. This is a significant signal of the weakness. At point 2 – the successful “No Demand”.

In point 3 and 4 these were successful “No Demand ” again, which confirmed the weak character of the market. In point 4, the signal can also be regarded as “Up-Thrust”. The low volume and narrow spreads suggest that supply has overcome demand.

In point 5 – two bars, one of which looks like an”Up-Thrust”, and the second – the breakdown of the support level of 1.124.

In addition, the weakness of the market confirmed the signals from TF H4: down bar with high volume in point 1, “No Demand” in point 2, followed by a decrease in prices, “Up-Thrust” in point 3 and the breakdown level of 1.124 in point 4.

 

Suggested Strategies

Consider only sell if the price will approach to the level of 1.124 and «No Demand» bar appears. Also, consider sell if the price breakdown the last low and «No Demand» bar appears. These should be searched in a lower timeframe.

Yen’s Trading Range – Is It Accumulation Going On?

Dynamic trend: Turned up

Background: W1 – weak; D1 – weak

Phase: Accumulation

 

Yen Daily Trend

Yen Daily Trend

 

On the daily timeframe there was bullish activity (signs of accumulation). In point 1 there was “Selling Climax” on a very wide range and very high volume. In point 2 there was a “Test” with a high volume. The market is not ready for a long-term upward trend, as the volume in point 2 is high, and the «Test» has  failed, thus showing the weakness of the market. The accumulation continues.

 

Yen Hourly Range

Yen Hourly Range

On TF H1 in point 1 there was a “Shakeout”, followed by up-bar with a wide spread. The volumes were very high. Point 2 was the successful “No Supply” followed up bar that tells us that demand has overcome supply.

 

In point 3 it was a “No Supply “. This low volume in this spot, shows lack of the interest from the professionals to breakdown the low of the range.

 

Suggested Strategies

The end of the accumulation phase in the medium term should witness the breakdown of the level 101,150. At the moment, VSA is showing supply, and we may see a correction to the 100 level again, which may give a long opportunity. It’s important that the price doesn’t close below 100, as that would mean that prices will probably test the low at 99.5.

EURUSD Multi-timeframe Analysis with VSA

EURUSD H4

 

This is the third of a series of posts about EURUSD’s trend. In last Monday’s analysis, the point [1] was regarded as the selling climax. However, the subsequent down-bars had reduced volumes and narrow spreads and further “No Supply” in point [2] showed the lack of interest on lower prices from the Smart Money.

In point 1 and 2 there were two strong “shakeout” with a high volume and wide spread. The result – price increases.

In point 3 and 4 there was a change in price/behavior. It became bearish (i.e. volume growth leads to price decreases). Also, on the H4 timeframe, the down bar with high volume in point 1, “No Demand” in point 2 and the further price decreases on the show the same weakness.

 

EURUSD H4

 

Suggested Strategies

Consider selling if the price breaks the level 1.124 and «No Demand» bar appears. On the other hand, if the price breaks-out the level 1.13 and «No Supply» bar appears, a long should be considered. The lower timeframe can be used to search for the «No Demand» and «No Supply».

EURUSD Sluggish Rally – Follow-up Analysis

Since the last analysis, EURUSD did make a downtrend after the news event, but the volumes dried up, and a rally began. On the 2nd correction, there was yet another consolidation on low volume, and the price would break the long-term resistance at 1.123 in the London session. Since the breakout, the market has continued the rally, but on the last days some supply has appeared, which may mean some big traders are starting to take profits, but not necessarily supporting a down move just yet. The break of the up trendline on good volume would make it more likely there is distribution going on, and in my view, it would give a short position possibility.

 

EURUSD Supply reaching new highs

Let’s Take a Look at Bitcoins

On the weekends, the markets are closed and nobody trades right? Right, unless it’s bitcoins! It’s traded 24/7 on various online exchanges, such as poloniex.com or kraken.com.

So, how does BTC/USD (bitcoin versus US dollar) look like? On the daily timeframe, the rally from $440 was stopped on heavy distribution, reaching nearly $779 per Bitcoin on its peak. A downtrend ensued, and what caught my attention, was the recent selling climax on a really high volume – a lot of big buy orders were executed here, which made the wide bar close off its lows, and the volume fire up. The market was sustained right after, and it’s now breaking the high of a no supply yesterday.

 

Bitcoin Market Analysis

Bitcoin Market Analysis

 

An advantage of trading bitcoins, is that you also get access DOM (depth of market), or order book, usually only accessible in standard financial markets by paying a hefty sum every month. Here we see that lower prices have buy orders in a much higher volume than higher prices have sell orders:

 

Bitcoin Depth of Market

Bitcoin Depth of Market

This is more bullish evidence to me, at least on the daily timeframe, where this selling climax, and order book imbalance, will have more meaning.

EURUSD Trend Continuation after the 1.116 Mark

Dynamic trend: Turned down

Background: W1 – weak; D1 – weak

Phase: Mark up

 

EURUSD H1 Breakout

EURUSD H1 Breakout

In point 1 there two breakout bars, with high volume. The second bar had very high volume, which usually means there is some supply behind.

In point 2 was a series of down – bars with low volume, including a test. The up-bar with very high volume in point 1 with upthrust are very significant signs of weakness. But the weakness was not confirmed due to the appearance of the test shortly after.

In point 3 there were two up bars with high volume, which is a normal trend continuation.

 

Suggested Strategies

The market is still bullish, with a strong background. Wait for a strong VSA signal.

USDJPY Downtrend after Distribution

Dynamic trend: Down

Background: W1 – weak; D1 – weak

Phase: The market is downtrending after significant distribution on the last top (mark down)

 

USDJPY Downtrend after Major Selling (distribution)

USDJPY Downtrend after Major Selling (distribution)

In point 1 there was an Up‐thrust with very high volume (climax). The next bar was a down bar with high volume, which confirmed selling (weakness) in point 1. VSA showed major supply on timeframe H1 and H4. An upthrust is a bar that makes a higher high than the previous ones, but closes on the lows or mid of the range; it’s a supply bar, usually appearing on fake-breakouts or stop hunting.

In point 2 there was another Up‐thrust again, which showed overall weakness. Also, the volume in point 2 was much lower the volume in point 1, which means the supply in point 1 has overcame demand.

Note: due to obvious weaknesses of background in the area 2.1, it’s recommended to switch to the M15 timeframe to search for “No demand” as the potential point of entry. Often these appear with a good risk:reward ratio (1:4 or more)

In point 3 there was another Up‐thrust with very high volume.

In point 4 there was No Demand. It confirmed overall weakness.

Suggested Strategies

Consider going short when the price gets back to 103.50 area, and VSA produces No Demand signal (those would be low volume up bars). This is an area of previous weakness, and a round number, which means there will be retail traders to shakeout at that area.