In the often perplexing world of futures trading, the term "smart money" can conjure up images of mysterious traders wielding enormous influence over market direction. Though the identities of these market wizards may never be known, their impact is undeniable, as they add and remove volume and volatility at will and guide the ebbs and flows of prices without leaving obvious clues to their next moves.
In the video below, we explore smart money concepts and what the term "smart money” means for futures traders. You’ll also learn about the world of volume spread analysis (VSA), a technical analysis methodology developed by former syndicate trader Tom Williams.
Additional topics discussed in this free livestream:
How to gauge market sentiment by reading charts, combining price and volume, and reviewing volume spread analysis (VSA)
How your insights can help turn perceived market pitfalls into opportunities
What is volume spread analysis (VSA)?
Real-world examples making volume spread analysis accessible to traders of all skill levels
Specific trading behaviors that can drive price
How to identify smart money in a futures market
Using Smart Money Concepts to Identify Trading Patterns
For the seasoned futures trader, cracking smart money moves isn't just a necessary skill—it's an art form. Armed with specific technical analysis tools, traders attempt to map out the footprints left behind by these financial titans, turning patterns into projections and charts into potential trading opportunities.
The book "Trading in the Shadow of the Smart Money" by Gavin Holmes demystifies the behavior of the so-called smart money that’s usually exhibited by institutional investors, hedge funds, and large traders who dominate futures markets. Holmes explains how these market players influence price movements and how their actions can be decoded through the analysis of volume and price.
Smart Money Concepts: The Core Principles of VSA
By analyzing anomalies in volume and corresponding price changes, traders can better identify potential market moves before they happen. Understanding these smart money concepts and the core principles of VSA can empower you to trade confidently by knowing the dynamics that can drive market trends and avoiding common traps set by more influential players.
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