I've annotated a couple of charts with a potential entry for a long position. First, the 15min chart.
EUR/USD 15min
We had a couple of 15min volume zones stacking up on each other which made the picture quite clear to me at least. The only annoying thing is not getting an entry in the places I like to see them. There are three zones at A, B and C.
A is the highest volume from Thursday and this proved strong as we continued to push up from here.
B is an early morning spike in volume as price came back down to the 50% of A. Volume at volume. This was strength and the market reacted up soon after. I was looking for a position in here around the 50% but didn't get any. Once we pushed through the high and tested along it there was no entry for me either.
C is another down bar, increase in volume with the low sitting perfectly on the high of B. More volume at volume and further strength. This is where it got interesting.
EUR/USD 5min
There are two nice entry bars here, first a low volume test, followed by a no supply a couple of bars later. Taking the zones out of the picture, i'm sure these would serve as good entries for "pure" VSAers. Seeing as i'm not a pure VSAist, i'll move on from this point.
I considered taking them but didn't, neither of them were into the areas that I like to see them. Or are they?
Let's take the test first. The volume at C on the 15min chart had not yet been proven for me. So the test wasn't testing into the 50% of C or above. But, (and this is the important part) it was testing into the high of B. B was already proven strength so I probably should've looked to take that as an entry. But I didn't.
So on to the next possible entry, the no supply. The test was proven straight away, it was a successful test with a healthy increase in buying volume on the next bar. We had a small retrace of two bars with the latter being a nice narrow spread and low volume. There had already been a successful test so I think this no supply was further confirmation and was worthy of a position. Interestingly, had the bar before the test had volume less than the previous two, I would have set an order, as it was straddling the 50% line.
I'm starting to over analyse this I think!
I've been talking to people about treating the high, low and 50% as a zone in their own right, not as a rigid line in the sand. Giving a few pips either side for a test to appear might be a good way to approach it. I'll have to look into it a bit more.
Ok that's everything, enjoy the weekend all!
Cheers,
Liam
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