VRT Cheat Sheet New PDF

VOLUME REACTION
TRADING (VRT)
CHEAT SHEET
What Is Volume
Reaction Trading?
Volume Reaction Trading is a technique developed by Yuuya Kato
over his years of experience trading. Yuuya Kato has passed 10
different prop firm challenges between 4 different prop firms,
has been funded over $1M in trading capital, and has done it all in
less than 10 months. The strategy broken down in this document
is the exact strategy he has used to achieve such success.
Just like the name, the strategy revolves around reacting to volume in the
market. A lot of the time, as traders, we try to predict where the market
is going to go and we try to place a trade before the market gets there.
Volume Reaction Trading is completely different; it is based on reacting
to big, momentous moves in the market and riding those moves once
they have already started.
Volume Reaction
Trading Checklist
Pairs to trade - GBP/USD, GBP/JPY, XAU/USD
The ideal time to look for a setup is 1 hour before the opening of the
London Session or the New York Session. There may also be opportunities
for GJ and Gold during the Asia Session.
DAILY
z Determine Bias/Direction You Are Going To Trade
z Draw Support/Resistance Areas
z Draw Fibonacci
4 HOUR
z Look For Price Action On Daily Support/Resistance Areas In The
Direction Of Your Daily Bias
z Draw Fibonacci
1 HOUR/30 MIN/15 MIN/5 MIN
z Look For A Recent Range Of Candles
z Trade Setup Is In Direction Of Daily Bias Bouncing Off Of Bottom/
Top Of Range Or Breaking Through Bottom/Top Of Range
ENTER YOUR TRADE
z Only Enter Trade On A Time Frame Where You Can Put Your Stop
Loss Above/Below Previous Candle Or Structure That Is Within
The Range Of…
{ 15-30 Pips On GBP/JPY
{ 15-30 Pips On GBP/USD
{ 30-50 Pips On XAU/USD
z Take Profit Strategies
{ Fixed 1:1 Or 1:2
{ Next Area Of Support/Resistance
{ Fibonacci Extensions 1.27 And 1.618
Table Of Contents
KEY CONCEPTS��01
Support & Resistance��01
Fibonacci��01
Engulfing Candle��01
Multiple Time Frame Analysis��01
TRADE THE RIGHT PAIRS AT THE RIGHT TIME��02
DAILY ANALYSIS��04
Daily Bias��04
CLEAR BULLISH BIAS:��05
CLEAR BEARISH BIAS: ��06
BULLISH OR BEARISH BIAS?��07
BULLISH.. NOW BEARISH?��08
RANGING MARKET?��09
Support & Resistance��10
Fibonacci��11
4 HOUR ANALYSIS��12
Price Action On Daily Support/Resistance Areas��12
Fibonacci & More Support/Resistance��13
LOWER TIME FRAME ANALYSIS (H1, M30, M15, M5)��14
ENTER YOUR TRADE��16

Stop Loss��16
Take Profit��18
MANAGE YOUR TRADE��19
BONUS CONCEPTS/TIPS��20
CONCLUSION��22
Key Concepts
SUPPORT & RESISTANCE
To learn more, reference Edge Trading Academy Module #4: Support &
Resistance
FIBONACCI
To learn more, reference Edge Trading Academy Module #6: Fibonacci
To match your fibonacci settings in TradingView with Yuuya’s, please

reference this image.
ENGULFING CANDLE
To learn more, reference Edge Trading Academy Module #5: Support &
Resistance, Section #4: Dual Candlestick Patterns
MULTIPLE TIME FRAME ANALYSIS

To learn more, reference Edge Trading Academy Module #13: Time Frames
VOLUME REACTION TRADING (VRT) CHEAT SHEET 01

Trade The Right Pairs
At The Right Time
A very important part of Volume Reaction Trading is to trade the RIGHT
pairs at the RIGHT time. What do we mean by this?
First of all, we want to make sure that we trade the right pairs which
are pairs with volume. This means that the price regularly fluctuates or
makes big moves from big players (i.e. banks, institutions, etc.) moving
the market.
Once we have our pairs picked, we want to trade the pairs at the time that
they actually have volume. Pairs have lower volume and higher volume
depending on the time in the market. Generally, a pair will have the most
volume when the market is open for at least one of the currencies of the
pair. For example, during the Asia session, the pair GBP/USD doesn’t
move a whole lot because both the GBP and USD markets are closed
(GBP - London Market & USD - New York Market). But once the London
market opens, a pair like GBPUSD will move a lot more because the
London Market, which involves GBP, is now open.
You can see in the image above that during the London/NY Sessions, the
price of GBP/USD moves a lot. However, during the Asia session, not a
whole lot is going on. For this pair, we want to trade during the London/
NY Sessions when there is a lot of movement or what we call volume!
02 VOLUME REACTION TRADING (VRT) CHEAT SHEET

The three main pairs that we trade in Volume Reaction Trading are the
following:
z GBP/USD
z GBP/JPY
z XAU/USD
You are welcome to choose whatever pairs work best for you based on
the criteria described above, but for us, we’ve just gotten to know these
three pairs the most. There’s no need to trade lots of pairs. It’s best to
pick maybe two or three and focus on mastering just those pairs.
Now that we have our three main pairs selected and we know when
the best time is to trade them, let’s start by analyzing the pairs on the
daily chart. Generally, this is done one hour before the opening of the
London market so we can be ready to react to whatever happens once
the London market opens.

Daily Analysis
As mentioned above, we should be looking at the daily chart of the pair
we are trading about an hour before the London market opens. On the
daily chart, we will be determining the following:
1. Daily Bias
2. Support & Resistance Areas
3. Fibonacci
DAILY BIAS
The first thing we are going to do is analyze the daily chart of the pair
we are trading. We want to start by determining whether the daily
bias is bullish) or bearish . When we drop to the lower time frames to
actually place the trade, we will only be looking for a trade in the same
direction as the daily bias. For example, if the daily bias is bullish, we
are only going to look for buy opportunities on the lower time frames.
So, how do we determine if the bias is bullish or bearish?
The easiest way is to look at the most recent trend. Have there been
higher highs and higher lows or lower highs and lower lows? You may
not know what that means, so let’s look at some examples, starting with
the easy ones.

CLEAR BULLISH BIAS:
In the image above, you can see we are in a clear uptrend. Just as the
blue arrow shows, the market is going from a lower point to a higher
point. You can also see the areas labeled “Higher Highs” (HH) and “Higher
Lows” (HL). When we identify the higher peaks and valleys in the market,
it helps us to know the market is in an uptrend. We want to trade with
the trend/bias of the market. So in the example above, when it comes
time to place a trade, we only want to be looking for “buy” opportunities.

CLEAR BEARISH BIAS:
In the image above, you can see we are in a clear downtrend. The market
is going from a higher point to a lower point. You can also see the area
labeled “Lower Highs” (LH) and “Lower Lows” (LL). When we identify the
lower peaks and valleys in the market, it helps us to know the market is
in a downtrend. We want to trade with the trend/bias of the market. So,
in the example above, when it comes time to place a trade we only want
to be looking for “sell” opportunities.

BULLISH OR BEARISH BIAS?
In this example, it looks like a clear bullish bias with the higher highs
and higher lows. However, you can see we have an area of resistance
forming (boxed in blue above). Because of the trend in the market, we
still have a bullish bias here and will be looking for “buy” opportunities.
However, we would want to wait for a break of that resistance to the
upside before placing a “buy” trade. We will talk more about support
and resistance later on.

BULLISH.. NOW BEARISH?
This is a great example of what happens all the time in the market. I
have divided the image above into two sections. The section on the
left is clearly in an uptrend as it creates higher highs and higher lows.
However, as soon as we get to the blue line, you can see the market begins
making lower highs and lower lows. To the right of the blue line, we are
beginning a downtrend. It is more important to look at what is most
recently happening in the market (maybe the past 30 candles/days) than
what has happened over a long period (the past 150 candles/days). In
this case, we would have a bearish bias because the most recent activity
(past 30 days or so of candles) have been in a downtrend. Also, you can
see boxed in green that we have broken below the most recent “higher
low” of the uptrend which signals a reversal in trend.

RANGING MARKET?
Something else you may encounter is that the market doesn’t always want
to trend one way or another. The market sometimes goes sideways and
ranges between two areas. If this is the case, we can still trade between
this range and trade in the direction that the market is currently headed
after “bouncing off” of the most recent support/resistance that the market
is ranging between.
For example, in the image above you can see the market has been ranging
between the two blue boxes. The green arrows follow the price as it
fluctuates between the two blue boxes. Most recently, the bottom of the
range was hit, and we can see there was also a bullish engulfing candle
that just printed coming out of the blue zone. This is a really good signal
for a potential “buy” trade. We would expect the market to now head up
towards the top blue box once again. We can react to this bounce off of
the blue zone and catch part of that move!

SUPPORT & RESISTANCE
After determining which direction we are going to trade, the next thing we
want to do is draw our areas of support and resistance on the daily chart.
We do this by finding areas on the chart where the price has repeatedly
been rejected. You may already know how to find these areas, but if you
don’t, the easiest way to do this is to look at a line chart. The line chart
plots out the close of the candles and connects them with a line. To draw
the support and resistance areas, just find areas where there are peaks
and valleys across from each other.
In the image above, you can see we drew green zones through a bunch
of peaks and valleys made on the line chart. The peaks and valleys are
circled with colors which correspond to the peaks/valleys across from
each other for reference. These are major areas on the daily chart where
price reacts by either bouncing off of the area or breaking through it.

FIBONACCI
Finally, we can draw out our fibonacci levels in order to help us to see key
areas in the market. You may not always use fibonacci on the daily chart.
It is just for additional confirmation of the areas of support/resistance
that you previously drew. Let’s look at a quick example. In the image
below, we have determined this pair has a bearish bias and so we are
looking for a “sell” opportunity. We can see that most recently the market
made a move down and is now retracing back up. This is a perfect time
to draw our fibs. In the image below, you can see we drew the fibs from
the most recent high to the low of the move (see the dotted line which
connects the points we used to draw our fibs). The market is currently
sitting around the 61.8 fib level. We can also see boxed in green that this
area was previously support that could now turn into resistance. This
gives us two confirmations that the market may react to this area and
continue to the downside.

4 Hour Analysis
After analyzing the daily chart, you should know whether you are looking
for buy or sell opportunities based on the daily bias you determined,
and you should have the support & resistance areas marked up and your
fibs drawn as best as you can Now it’s time to move down to the next
lowest time frame, the H4 chart. You should be able to see the support
& resistance areas and fibonacci that you drew on the D1 chart now
appear on your H4 chart. On the 4 hour chart, we are going to determine
the following:
1. Price Action On Daily Support/Resistance Areas

2. Fibonacci & More Support/Resistance
PRICE ACTION ON DAILY SUPPORT/RESISTANCE AREAS

Now that we are looking at the 4 hour chart, we want to look for exactly
what is happening on the areas of support and resistance that we drew
on the daily chart. The daily chart support and resistance areas we drew
should be showing on our 4 hour chart now. Ideally what we are looking
for is something like we see in the example below. We want to see some
convincing price movement bouncing off of a zone and moving in the
direction of our daily bias (in this example, we had a bearish daily bias).
We do not want to take a trade until we see price react to the support or
resistance area and head in the direction of our daily bias. In the image
below, I pointed to two decently sized bearish candles coming out of the
zone. Now could be a good time to react to this price movement!

FIBONACCI & MORE SUPPORT/RESISTANCE
Sometimes it can be easier to pull out your fibs and draw them on the
4 hour chart vs. the daily chart. If you see a good opportunity to draw
your fibs looking on the 4 hour chart, you can draw them and look for a
match between one of the fib levels and the support/resistance areas you
drew on the daily chart. You may also see additional support/resistance
areas now on the 4 hour time frame that you couldn’t see before on the
daily time frame. You may draw these in now as well before dropping to
lower time frames next.

Lower Time Frame Analysis
(H1, M30, M15, M5)
At this point, you have the direction you are going to trade (long or
short), and you have found some momentum off of an H4 or D1 zone of
resistance/support in the direction you want to trade. At this point, we
want to drop to a lower time frame for our entry. Everything up until now
has helped us to find the direction of the momentum in the market for
the day so that we have a higher probability of placing a profitable trade
on these lower time frames.
You can start your lower time frame analysis by dropping to the H1 time
frame. What we are looking for is an area of consolidation or a rectangle
in which the market seems to be “trapped”. If you don’t see this on the
H1, you may need to drop to an even lower time frame until you find it.
It should look something like the image below.

You can see in the image above that we dropped down to a 15 minute
chart to find this range we are currently in. The market went to the top
of the green rectangle, then to the bottom of it, back to the top, and now
it looks like it is beginning to head towards the bottom of it again. This
would be a great opportunity to take a “sell” trade (assuming on the daily
chart we determined the bias was bearish and on the 4 hour chart we saw
some momentum off of a daily or 4 hour resistance zone). To make sure
it’s clear how we got to this point, please watch this video where I show
this trade and break it down from the daily all the way down to this 15
minute chart (https://vimeo.com/578902706/dcc3923541).
Hopefully that video helped you! I want to explain a little more about
where exactly you can place your take profit or stop loss and also explain
which of the smaller time frames you would want to place your trade on
in order to have a tight enough stop loss.

Enter Your Trade
Now that we have determined the criteria for entering a trade, let’s talk
about where you would put your stop loss and take profit..
STOP LOSS
Generally, we are looking for our stop loss to be this many pips away
from our entry depending on the pair…
GBP/JPY 15-30 pips
GBP/USD 15-30 pips
XAU/USD 30-50 pips
As mentioned in the video above, we are looking to put our stop loss
above/below the previous structure (highs/lows) or above/below the
previous candle. If we are looking at the H1 chart and we are looking to
enter a trade, but putting our stop loss above/below previous structure
would be outside of the range of pips for our stop loss mentioned
above, then we would want to move to a LOWER time frame to find
a place to put our stop loss above/below the previous structure on
the LOWER time frame that is in the range of pips mentioned above.
If that didn’t make sense, let me explain it through an example..
In the example below, gold had moved 315 pips in an hour. You can see
if we had entered off of the bearish candle on the H1 chart, we would
have had to put our stop loss above that previous candle 315 pips away.
That’s a very wide stop loss even with the current volatility/volume in
the market.

If we drop down to the 15 minute time frame shown in the image below,
we could put our stop loss just above the high of the previous candle to
have a much tighter stop loss (maybe more like 50 pips away from the
entry). Having a tighter stop loss like this allows us to be able to place a
trade with a higher lot size while still only risking a small percentage of
our account and we won’t be stuck in a trade for a long time which can
be difficult psychologically as well.

Just like the example above, you’ll have to move down to whatever time
frame gives you the market structure you need to put your stop loss at a
distance away from your entry that falls within these ranges:
GBP/JPY 15-30 pips

GBP/USD 15-30 pips
XAU/USD 30-50 pips
Yuuya usually risks around 1% of his account per trade.
TAKE PROFIT
There are several ways to take profit on your trades. Yuuya personally goes
for a fixed 1:1 or 1:2 risk:reward trade (his take profit is the same distance
away from the entry as the stop loss for 1:1, or twice as far for 1:2). Since
Yuuya is generally in his trades for less than an hour (sometimes longer if
trading on the hourly chart), he is able to monitor the trade and wait for
it to lose momentum to exit the trade. By this, I mean when the market
begins to move in the opposite direction of the trade he will exit the trade.
The second way to place your take profit is by looking at the market
structure and taking profit at the next support or resistance area.
The final and more complex way to place your take profit is using the
fibonacci extensions tool. Yuuya will set his profit targets by looking at
the 1, 1.27, and 1.618 fib levels (based on how Yuuya has his fib settings
described in the fibonacci section of this cheat sheet). You can see in the
image example to the right that if the price were to reach the 0.618 level
and we were to buy at that point, we could put our take profit 1 at the 1
level, our take profit 2 at the 1.27 level, and our take profit 3 at the 1.618
level. Generally, Yuuya takes all of his profit at the first level or sometimes
even before it gets there. However, there are many times when price will
continue in your direction and you could ride out the trade beyond the
tp1 level.. This would be a good time to take some partial profits at the
tp1, some more profits at the tp2, and then let the rest of the position
ride out, trailing it with a stop loss along the way.

Manage Your Trade
Something that Yuuya does that is essential to your trading is he moves
his stop loss to break even once the trade has moved 15-20 pips in his
favor or when it reaches the next support/resistance zone. This will
minimize losses on trades that go into significant profit. The last thing
you want is to be in profit 15-20 pips just to have the market reverse and
hit your stop loss.
As we talked about above, you can also use strategies such as taking
partial profits at different take profit levels while also moving your stop
loss to break even. We want to secure our profits as soon as we can and
not get too greedy. The purpose is to scalp the big, momentous moves
and to get in and out of the market as quickly as possible,

Bonus Concepts/Tips
z Sometimes there is consolidation during the Asia Session and when
the London Session hits, volume kicks in and the market breaks out.
However, you’ll notice that sometimes when London opens, it will
fake up to one side (looking like a breakout) and switch directions
rapidly. When this happens, it will usually be in the opposite direction
of the Daily/4 Hour bias. (So again, it’s usually best to always stick
to the daily bias!)
z Sometimes there are opportunities for trades on the pairs GBP/JPY
& XAU/USD during the Asia Session.
z Volume Reaction Trading focuses on trading alongside the big
institutions that come in at the open of London and New York. We
wait for confirmations to determine the direction the big institutions
are trading for the day and we react to those confirmations.
z Wicks tell a story. Wicks tell us where the money is. Wicks tell us
where volume will kick in. We always trade with volume and the
bias of the market..
z Usually when we drop down to the 1 hour time frame, we look for a
range that is usually 30 pips.
z A great strategy is to give a trade two tries. HOWEVER, Yuuya never
does this on impulse. BEFORE he gets into the FIRST trade he will
have already decided that if he gets stopped out, it is worth it to
give the trade a second chance. Yuuya usually risks less on the first
trade in case it hits his stop loss so he can risk more on his second
trade (the higher probability trade). Once you have found a setup
like this, you can take the first trade. The first trade may be stopped
out because of some market manipulation. On the “second chance
trade”, Yuuya will usually take profit at a point equal to the loss of
the previous trade (to recover his loss from the first trade) plus 15-20
pips profit beyond that.

z The goal is to minimize the distance to your stop loss as much as
possible. With this strategy, we are trying to hit our take profit or
stop loss FAST. This is why we trade with volume. This is why we drop
to the time frame needed to place a tighter stop loss based on the
previous market structure on that lower time frame.
z If using fibonacci extensions to take profit, Yuuya likes to take profit
at tp 1 (the 100 fib level). He then likes to leverage those profits to
get to tp 2 (enter another trade right after taking profit) or on his
next trade setup.
z Yuuya has found that there is a higher probability that the market
will reverse in his favor if it bounces off of the first fib level (0.382
or 0.681 depending on if it’s a buy or sell trade). The more fib levels
that are broken before a good reaction, the lower the chance of the
market reversing. This is because if the market is really trending in
one direction, there won’t be enough momentum in the opposite
direction to cause a good reversal off the pullback.
z Engulfing Candle Tip - When there is lower volume in the market
(maybe during the Asia Session but sometimes during the London/
NY Sessions as well), you can combine a bunch of low volume candles
to create one big engulfing candle. Just be aware that you might be
in the trade longer since there isn’t as much volume at the time (and
this can be a riskier setup).
z You can use the 20, 50 and 200 exponential moving averages as
additional confirmation. If the market bounced off of or broke through
the moving averages, it can be an additional confirmation of where
the market is headed. To learn more about moving averages, reference
Edge Trading Academy Module #7: Moving Averages.
z It’s a good idea to leave your chart marked up from day to day so you
can reference past days and see how they reacted to your analysis.

Conclusion
I hope this cheat sheet has helped you better understand how
you can successfully trade using Volume Reaction Trading! But,
of course, the best thing to do now is to dive into the asset you
want to trade and look for all of these confirmations on the asset’s
historical data! This will help you to practice and begin recognizing
the additional confirmations. It may take some time and effort to
master trading, but it is TOTALLY worth it!
We recently released the opportunity for our traders called the

90 Day Funded Trader Fast Track Program where you get 1-on-1
mentorship from Yuuya Kato himself! This is an opportunity that
we open once in a while, but as you can imagine, there is VERY
high demand for this and we only accept a few people into the
program at a time.
Our guarantee with the program is that you will get funded and
make back your investment into the program or 10-time funded
trader Yuuya will work with you for FREE until you do!
This program is the highest level of service we offer to help our

traders to learn from the best of the best and master a skill that
can make them money for the rest of their lives.
If you would like to join the waiting list to be notified the next time
this program is available, visit https://www.fundedtraderfasttrack.
com/ftft-apply

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VOLUME REACTION

TRADE THE RIGHT PAIRS AT THE RIGHT TIME�����������������������������02

LOWER TIME FRAME ANALYSIS (H1, M30, M15, M5)����������������������14

ENTER YOUR TRADE����������������������������������������������������������������16

MANAGE YOUR TRADE��������������������������������������������������������������19

To match your fibonacci settings in TradingView with Yuuya’s, please

MULTIPLE TIME FRAME ANALYSIS

VOLUME REACTION TRADING (VRT) CHEAT SHEET 01

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VOLUME REACTION TRADING (VRT) CHEAT SHEET 03

04 VOLUME REACTION TRADING (VRT) CHEAT SHEET

VOLUME REACTION TRADING (VRT) CHEAT SHEET 05

06 VOLUME REACTION TRADING (VRT) CHEAT SHEET

VOLUME REACTION TRADING (VRT) CHEAT SHEET 07

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VOLUME REACTION TRADING (VRT) CHEAT SHEET 09

10 VOLUME REACTION TRADING (VRT) CHEAT SHEET

VOLUME REACTION TRADING (VRT) CHEAT SHEET 11

1. Price Action On Daily Support/Resistance Areas

PRICE ACTION ON DAILY SUPPORT/RESISTANCE AREAS

12 VOLUME REACTION TRADING (VRT) CHEAT SHEET

VOLUME REACTION TRADING (VRT) CHEAT SHEET 13

14 VOLUME REACTION TRADING (VRT) CHEAT SHEET

VOLUME REACTION TRADING (VRT) CHEAT SHEET 15

GBP/JPY 15-30 pips

GBP/USD 15-30 pips

XAU/USD 30-50 pips

16 VOLUME REACTION TRADING (VRT) CHEAT SHEET

VOLUME REACTION TRADING (VRT) CHEAT SHEET 17

GBP/JPY 15-30 pips

18 VOLUME REACTION TRADING (VRT) CHEAT SHEET

VOLUME REACTION TRADING (VRT) CHEAT SHEET 19

20 VOLUME REACTION TRADING (VRT) CHEAT SHEET

VOLUME REACTION TRADING (VRT) CHEAT SHEET 21

We recently released the opportunity for our traders called the

This program is the highest level of service we offer to help our

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TRADE THE RIGHT PAIRS AT THE RIGHT TIME��02

LOWER TIME FRAME ANALYSIS (H1, M30, M15, M5)��14

ENTER YOUR TRADE��16

MANAGE YOUR TRADE��19