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VSA FOREX Strategy: How to Use Volume in the FOREX Markets

Posted by the Tradeguider Team on May 1, 2020 5:00:00 PM

Tradeguider-VSA-FOREX-Strategy-20200720

Traders often overlook a VSA FOREX strategy because they think a volume-based approach doesn’t apply. However, Wyckoff VSA can still be used even if there isn’t a centralised provision of volume information. Learn more about applying volume to FOREX markets in our blog. 

 

Smart money is still active in FOREX

When we hear about a currency being strong or weak we are really hearing what professional traders - the smart money - think of it, and whether they are jumping into its movement or not. It happens every day. The large amounts of money and contracts they play with are big enough to change the direction of a market. 

However, as you’d expect, they don’t want to signal their movements, which is why they don’t publish their volume information. Maybe it’s even them who purvey the myth that volume can’t be analysed in FOREX. Perhaps they don’t want you to know. After all, it’s the largest trading market worldwide and they benefit if you don’t have a smart trading strategy.

So, we strongly recommend embracing a VSA FOREX strategy. Here’s why Volume Spread Analysis is still useful in FOREX markets.

 

Volume is still useful in FOREX

As we know FOREX is a decentralised market, which means that there is no single source of volume information from an exchange, such as that provided in the stocks or futures markets.

But traders can still use a Wyckoff VSA FOREX strategy to propel themselves towards consistent wins. Tick volume can be used - even if it doesn't provide a full picture, as it’s the number of ticks relative to the previous total that’s analysed. It’s added to the price movement on every price tick up and down. As the deals go through, this automatically creates more ticks, hence higher volume.

The Tradeguider Wyckoff VSA approach works because it takes the relative volume compared to the previous bar to produce an indicator. At least 80% or even more of that volume or activity will be professional or smart money, so by analyzing the tick volume, Wyckoff VSA is still analyzing the activity of the smart money.

 

Want to elevate your VSA FOREX strategy?

Even if you’re already a FOREX trader you can stop trading in the dark, tap into the knowledge that Wyckoff VSA brings, and employ a smart FOREX strategy.

If you’d like to learn more about applying volume to the FOREX markets or you’re interested in elevating your VSA FOREX strategy, we have lots of great information and videos on our website. Check out the Free Tradeguider Resource Center. If you want to be guided through how to use Wyckoff VSA for your FOREX trading then get in touch for a demo.


Tradeguider is the home of Wyckoff Volume Spread Analysis (VSA). As highly experienced experts in trading techniques and trends, we use it ourselves to trade FOREX markets and can vouch for its efficacy. We share our knowledge and experience of VSA FOREX strategy (and other asset classes) on our website, from eBooks and pdfs to webinars and videos. Our trading services include trade alerts for FOREX as well as and futures, stock scanning and commodities and our mentorships and training courses address the FOREX market too. If you’d like to talk with us about how to see better returns in the FOREX market, get in touch with our experts today.

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