How to Trade Spot Forex and Currency Futures using Volume Spread Analysis to Follow The Smart Money Starts 6.00pm Chicago Time Presented By Gavin Holmes Professional Trader & CEO TradeGuider Systems International

The TradeGuider team want to wish all of you a VERY HAPPY AND PROSPEROUS 2011, and I hope I can teach you to make money by following “The Smart Money”!!

The Big Question Can YOU make money trading and investing in the FOREX/Currency markets? Don’t take my word for it, lets look at a world champion!!

The Big Lie!! Volume is irrelevant when analyzing a spot FOREX chart because there is no centralized exchange

WRONG – VOLUME IS EXTREMELY RELEVANT Let us examine the spot FX USD/GBP contract (where there is no exchange) and compare the chart to a currency futures contract, the 6B continuous contract which is the same currency pair, traded on the Chicago Mercantile Exchange, and see how different they are

Tom Williams is a former professional syndicate trader and inventor of a methodology called Volume Spread Analysis that tracks market manipulation as it happens on a chart. Now 81 Tom has written 2 books and still trades today. “The market is devious and many times you will buy on good news only to lose money and sell on bad news only to see the price rise soon afterwards, and that is because “Smart Money” understand crowd behavior and take full advantage of “The Herd”!!

What causes price to move on a chart? The past price does not cause the future price to move. The price movement is “caused” by the activity, either buying or selling, of “Smart Money”. This CANNOT be seen by analyzing past price, it is vital to look at more than one timeframe on any chart, and to look very closely at VOLUME as we will now see.

How Can Volume Spread Analysis Identify These Moves? Volume = Activity We are interested in volume because it tells us the consensus of opinion amongst the “Smart Money” The Spread and Close in Relation to the background Confirm

Volume – Spread or Range of Bar and Closing Price

How To Identify “Smart Money” Buying and Selling Volume – The Gasoline That Drives The Financial Markets – The Key To The Truth Three very important points to always remember when analyzing your charts 1.Volume is ACTIVITY. As an estimate, about 85 to 90 percent of the volume seen on the charts will be from large funds (George Soro’s), Institutional banks (Goldman Sachs) and Professional Trading Syndicates or Pools who are nameless, however Tom Williams worked for one as we have heard. 2.Ultra High Volume and Ultra Low Volume seen IN THE RIGHT PLACE in context with The Background are signals from the “Smart Money” of their true intentions, and these opportunities often arrive on earnings reports and news events. 3.Bullish volume is increasing but not ultra high volume on up bars and decreasing volume on down bars in an uptrend. Bearish volume is increasing but not ultra high volume on down bars and decreasing volume on up bars in a downtrend.

Why Is Ultra High Volume VERY, VERY important when you see it and what does it look like? Because it will often mark a top or a bottom on a price chart and give you an early warning that a trade is setting up against “The Herd”

Houston’s Yao Ming would be ULTRA HIGH VOLUME on a chart!! He is currently the tallest player in the NBA, at 2.29 m (7 ft 6 in).

TWO RULES NEVER TO FORGET Rule number 1 When WEAKNESS (shorting opportunities) appears on a chart, it will appear on an UP BAR, that is a price bar that has closed higher than the bar behind it, and will be on unusually high volume (TradeGuider calls this Ultra High) or unusually low volume (TradeGuider calls this Ultra Low)

TWO RULES NEVER TO FORGET Rule number 2 When STRENGTH (opportunities to go long) appears on a chart, it will appear on a DOWN BAR, that is a price bar that has closed lower than the bar behind it, and will be on unusually high volume (TradeGuider calls this Ultra High) or unusually low volume (TradeGuider calls this Ultra Low)

Lets take a look at the chart and see if we can spot Yao Ming anywhere!!! If an alien landed and asked how tall you were and the alien had never seen a human being then you would need to give that alien a comparison, just like looking at volume on a chart!!

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