The Equilibrium, a key to success!

The fastest information in the market


Hello dear subscribers,


Every trader dreams of receiving information in daily trading that predicts a possible course development. Various indicators are used to provide quick information. Today we want to look at what representations provide the fastest information to make profitable trading decisions.

Forex market

First of all, we need to be aware of what information we actually receive. Banks or institutions provide different brokers with price data from the interbank market. The interbank market is not stock exchange regulated. These data are processed differently by ECN brokers or market makers and passed on to their customers. From the broker, these course data first reach our MT4 and are processed there. These are three different dates. OHLC, time and volume that is generated from the ticks. Unfortunately, a tick volume has nothing to do with the volume of the stock market, I have already written extensively.

Volume in forex

Two traders who trade with different brokers will receive different price displays. Even if these two traders were with the same broker, the tick data on the MT4 would produce different representations. For this reason, only two crucial data are correct in the forex market: OHLC and the time data. Of course, the price jumps in the form of ticks are usually correct, but it is not possible to derive the correct volume, as in the stock market.

First, this information is displayed in the form of a candle and projected on the screen. In addition, we see next to the candle a price line. The displayed price line in MT4 is the bid price (Bid). In addition, you can also display the Ask price. The ask price is always higher than the bid price and the difference between the two rates is called the spread. As the spread widen, this indicates lack of liquidity on the ask or bid side. When we place a long position, our transactions are always opened at the ask price and closed at the bid price. When we place a short position, our transactions are always opened at the bid price and closed at the ask price. In order to keep an eye on the liquidity, I recommend to show the Ask line in MT4.

Candles are created from the ticks and the set time, which are displayed in the form of OHLC. What many do not even know, this representation of the candle is already an indicator. If we now represent a normal chart, this picture usually consists mostly of the past. The current price line Bid and Ask represents the present and the future is a black screen. As a rule, the past takes up about 90% of the total space required, while the last candle represents the present. Actually, this is a strange representation, because we traders want to earn money in the future and not in the past. However, for the most part we have the past displayed on the chart. Of course, the future cannot be displayed because it would only consist of a black screen. That means we traders try from the past to make a possible forecast for the future. Many beginners have had to learn painfully that this is a challenge that in most cases goes wrong. Roulette and forex are apparently based on random moves, but there is one crucial difference.

A roulette ball in the casino has no memory and the probability of winning red / black is 48.6%. In the Forex market, traders have a memory (certain price levels act as resistance), but the probability of profit is 1:19 or 5.26%. The advantage in Forex is that certain price levels can be declared as resistance or support, which increases the likelihood of winning. In the past, I also made wins with resistance zones, but I later realized that these resistance zones in Equilibrium are being initiated by the big players to take as few participants as possible in a breakout. Since I've only traded in equilibrium in the past, my chances of winning were significantly higher than if I had bet on a breakout.

We've found that a candle is nothing more than an indicator, let's look at other indicators. Most of the indicators are calculated from the price or the ticks and run according to the price. This means that most indicators react more slowly than the price. You realize this at the latest, if you build on your trading decisions on two MA's. The indicators may give a different or better view of prices, but in the end they are significantly slower than the Bid / Ask price line. Even current news brings no advantage, because you never know how the market reacts to it.

A small glimmer of hope are the currency strength indicators in the Forex. With this strategy, you first consider 8 individual currencies instead of 28 currency pairs. In the EURUSD, the dollar or euro strength is determined from the following currency pairs.

USDCHF, USDJPY, USDCAD, EURUSD, GBPUSD, AUDUSD, NZDUSD = dollar strength
EURUSD, EURGBP, EURCHF, EURJPY, EURCAD, EURAUD, EURNZD = Euro strength

The idea of buying a strong currency and selling it against the weak currency will not pay off in the long run because you do not know how the strength of a currency will develop in the future. If one currency is currently weak and the other is very strong, this can change within seconds due to a breakout. Every single currency belongs to a single economy. Some currencies are strong and other currencies are weak, we can not extract this information from a single currency pair chart. If the EURUSD rises, it may be because the dollar is weak and the euro is strong. Maybe both currencies are strong or weak, only the euro is slightly stronger in both cases. The key is to know how a single currency is positioned across the market.

In the case of the EURUSD, we don't have to look at 13 different currency pairs to measure the strength of the dollar and the euro, we just need a chart or two. First of all, this is a significant time saver. If the dollar suddenly becomes stronger in 5 currency pairs over the course of a day, we can see that more quickly in the overview chart. In many situations I found that this ad sometimes reacts a little faster than the price chart itself. That's why I like to work with currency strengths, but I would never derive a trade from them.

If you work with a price chart in Forex, I recommend that you work with a tickchart that forms up to 12 candles instead of 1 candle within a minute. This enables potential resistance areas to be identified more quickly. Since there is no top and no bottom in the price chart, I recommend placing the last candle in the middle of the chart if possible. Than there is enough space up, down and to the right for a possible look in the future.

Future

First, the exchange makes the price data from the exchange-regulated market available to different brokers. The brokers pass this data directly on to their customers. From the broker, this course data now reach our MT5 or our professional prop software and are processed there. This is four different dates. OHLC, time, volume and the number of trades. The volume is specified in the DOM with bid and ask. In addition, the liquidity in the form of the limit order is displayed, so it would actually be 5 different data.

Two traders who trade with different brokers will see the same price displays on their chart. That is a crucial difference to the forex market. Also important is the respective trading platform, which individually dissolves and translates the stock market data. On the MT5 I would not fall back here, because the information is very limited. Individual indicators can be created via mql5, but are very limited due to the programming language.

I recommend a professional prop software, which should be very variable in their settings. Good trading platforms also allow individual programming via C +. A good prop software allows not only footprint charts and volume charts, but also other interesting forms of presentation. An individual attitude of the DOM and the time & sales list is decisive. Similarly, deleted and added limit order should be visible. Pay attention to unique selling points, because these could be important trading advantages for you. A major weakness of all prop platforms is the fact that the number of trades cannot be broken down into bid and ask in all time units. However, that would be an enormous trading advantage today, which could reveal the identification of the big players in any unit of time. This would make it much easier to identify accumulation and distribution phases. If you are in a sideways market and you are able to see if the big players are collecting ask or bid, you are also able to take the movement of the stopfishing and the subsequent breakout. However, the existing platforms on the market are not yet mature enough.

My idea would be to build my own server, which first saves the 1 tick data from the exchange and makes this data available to you again in different time units. Crucial is the programming to get the data that is relevant for a trade decision. On the one hand there are importend small equilibrium in the tick data and on the other hand the number of trades in relation to the bid and ask. I think that could be a crucial market advantage.

First Conclusion:

In the forex market, the price range of bid and ask is the fastest information in the trade in addition to the currency strength. Even in the futures market you could calculate a currency strength, but the effort would be enormous, since you have to store for 28 currency pairs each a 1 tickchart and then merge the data. The result would be sensational, since one would be able to calculate the currency strength in the millisecond range. I am surprised that no one has yet come up with the idea.

In the futures market the current price line is the third fastest information. In second place are the bid and ask, which come on the market in 1 tick chart. Here you can immediately see how much lot (bid or ask) a single trader brings into the market. With a correct algorithm, you would even be able to assign the different trades to a particular trader. The advantage that results from this should be clear to everyone. In principle, the submitted bid or ask are at a certain price level, a small look into the future. By this I do not mean the bid and ask which lead to an immediate tick change, but the large bid and ask which do not immediately lead to a large price change. This is the so-called absorption where the big players e.g. euro buy massively in a falling exchange rate without significantly slowing down the falling exchange rate. It is a sensational achievement that I admire very much. But this information can also be read out relatively easily. In the first place are the limit order in the market, which represent the crucial liquidity. That is clearly the future, because a trader who gives up a limit order shows the willingness to enter into a trade at a certain price level in the future. Of course, limit orders are also deleted shortly before execution. But if that happens I can immediately recognize this in the DOM and take a counter position. A large fake limit order that is deleted shortly before execution is a great signal for a possible trend reversal. It is clear that the futures data on the one hand give a better idea of future price developments and thus belong to the fastest data in the market. This is an invaluable advantage that a trader should not do without. What matters is how you view the data. It is not the fastest Formula 1 car that wins, but the driver who manages to create an optimal symbiosis between driver and vehicle wins. This applies equally to a trader and his trading setup.

Both the data from the forex and from the futures market bring crucial information for trading. With the help of the future data, you can significantly increase your efficiency again. Therefore, for me both data are an important factor in the trade.

Let's take a closer look and start with the future data.




Point A

Here we see the delta of Bid and Ask. The red line shows the delta of big players, the green line the delta of retail traders. As we can see, in most cases a counter position arises, which is also logical. Because if someone sells, someone has to buy at the same time. The positions of retail traders are usually at a disadvantage, as the big players determine the direction. The delta is not always clear, because the big players also work with small positions, which limits the view somewhat.

Point B

The same view of the delta only in a smaller unit of time.

Point C

Here we see the split bid coming in the market. 1-6 Lot Bid are most common, so they have their own layout. 7-10 lot bids have been combined and the larger bids from 11 lots are displayed on the left with the associated time. The smaller lots usually provide an immediate change in price, while the larger lots are used to pile up bid or ask in the sideways markets. I will go into that again more precisely. An investment of a bid may mean that the dollar is bought or the euro is sold. It can be an order that comes into the market or an order that is taken out of the market (triggered stops example). The respective insight is not allways concrete, but you get a good overview of what is happening in the market. It can also be determined whether the number of bids or ask dominate the market and whether a larger number of lots are being collected.

Point D

The same display as for Point C only for the Ask page.

Point E

Between bid and ask I placed a day candle from the DOM in the middle. On the one hand, this shows the price movement, as well as the spread between bid and ask. This means that liquidity weaknesses can be recognized immediately at the limit orders. The number on the left side is the total volume Bid and Ask, on the right side you can see the number of trades at the respective price level. With this you can also identify larger orders at the individual price levels. Likewise one can recognize possible resistance zones due to higher volumes.

Point F / G

A 1 tickchart for the bid and ask page showing the order in progress. Gaps in order submission can be identified more quickly here. This view is a pure overview for the identification of Bid and Ask on the respective price levels and gives only a large overview what happens in the market. A trade should not take place over it.




This overview already gives more specific information about what is going on in the market.

Point A

In the DOM we see on the right and left side the total number of ask and bid within the whole contract. These are interesting zones to keep an eye on. In addition to the current price, I receive information about the liquidity of the limit orders, the bid and ask executed at the respective price level, as well as the accumulated, added or deleted limit orders. In addition, the currently added or deleted limit orders are displayed. This is crucial to identify pretended liquidity.


Point B

Here we see the open interest, i.e. the open long positions in the market.

Point C

This view shows whether the euro or dollar is bought or sold. From this, conclusions can be drawn about an accumulation or distribution. You can see when the big players get out of their positions and when they catch the stops of the retail traders. Of course, this information is not always correct because there are too many different situations. However, if one has the overall picture in mind, one can identify these potential errors.

Point D

A 30-second footprint chart with filtering that identifies strong and weak zones in the current price history. First and foremost I need this view to identify stopfishing. This means that short-term changes in trend can be recognized more quickly.

Point E

A 1 tick chart shows the submitted oders of a single participant on the bid and ask page.

Point F / G

The Time & Sales list shows the split ticks of Bid and Ask. The respective view contains the ask and bid price, the price change and the number of lots at the respective price level. In addition, the liquidity of the limit order can be displayed at the time of the change in the tick. The decisive criterion for me is the time display in milliseconds. This allows, to identify concretely the small orders, from the big players.




Let's first look at the 11th of November in EURUSD. Initially, massive ask in the sideways market was collected between 09:00 and 12:00 CET (Point A). Then a stopfishing was done and the course was pushed up to point B. From 2 p.m. 1000 Lot Ask were collected. I knew that the big player was waiting for a lot of volatility in the market. In the evening, there were some appointments that allowed increased volatility. USD Monthly Budget Statement, USD FOMC Economic Projections, USD Fed Interest Rate Decision, Fed Monetary Policy Statement and subsequent FOMC Press Conference. There was a short Stopfishing again at point C, then the course was pushed to the point D upwards. Even if the dollar had strengthened at these meetings, the rate would still have been pushed up. Because during the course of the day, the big players had collected many 1000 lots, which now had to be brought into profit. We see that these meetings are only needed to create the corresponding volatility in the market. What comes out is already clear beforehand. Although news and meetings influence the currencies, they do not affect the strategies of the big players. Let us first take a closer look at point A from 09: 00-12: 00 CET.




In the 1 tick chart we first recognize the price development in the sideways market at Point A. At Point B, it is noticeable that during this time a larger number of Ask than Bid came onto the market. That already gave the first indication of a possible accumulation phase. Of course, the other market participants also saw these large orders that came into the market. And that is exactly the crucial point. With the information that large orders are coming onto the market, the participants cannot do much at first, because as we can see in the picture, the price was then pushed down more strongly. This has stopped all the participants who have bet on a rising course. Therefore, we must remember that a big player usually only makes big orders, when it is clear that the price does not move directly in that direction afterwards. When many retail traders move up with the big players, some retail traders eventually start to get out of the market. At that moment the euro is sold and the dollar is bought at the same time. This slows down the course and the big players cannot finished their strategy up. How does it usually go? First, the big player buys large amounts of Ask in an accumulation phase. Then he pushes the course down and stops everyone who bought Ask. Then the way is clear, for a course up. This means that large orders are not directly price-relevant. For this reason, the big player doesn't care that you can identify these large orders in the market. The small orders that the big player brings to the market are relevant for the short term.

First, we see how the big player obviously buys big orders from Ask. We can assume that the price will initially not rise higher and suggest that it could come to a Stoppfishing.

What exactly happens during a stoppfishing?

The big player knows exactly that retail traders are trying to follow in his footsteps. By placing large orders in the ask area, the big player signals a future willingness to push the price up. This causes many retail traders to buy the euro as well. Since the big player determines the market anyway, he has no problem pushing the price down by 20 pip to stop the retail traders. He knows for sure that he will be able to push the price up again. The price is now pushed down until it hits the first stops of the retail trader. As soon as the stops are caught, a chain reaction comes down, because at that moment, the dollar is bought massively. Every stop that is caught pushes the price further down and in the end the retail traders ensure that the price goes down extremely sharply. The big player is already starting to get out of the dollar and is pushing the price up again.

Since the big player knows exactly that there is stopfishing, he naturally wants to participate in it. While buying large quantities of Ask in the sideways market, he also buys the dollar to push the price down for a short time. This approach should not be identified by the market, so the big player buys the dollar lot in small numbers. At point A, the big player started buying the small quantities. First let's look at how we can identify this approach.




First of all, it is important that we can display the time in milliseconds in the Time & Sales list.

At 10: 01: 00.3660 you can see at Point A how a big player buys almost 50 lot bids. The probability that other market participants have also bought bid in this thousandth of a second is very unlikely. Therefore, with milliseconds you are able to assign the small orders to a big player.

Just under 2 minutes later at 10: 02: 52.3690, almost 80 lot bids were bought within this millisecond. Although this large mass of orders was bought, the price only moved two ticks down. This shows how strong the pressure was upwards.

The algorithms that are used are random and not understandable for us. We can see the number of pieces the big players have bought within this millisecond. A 50 or 80 lot order would be noticed immediately in the market, the purchase of small quantities takes place under the radar and is not recognizable for most traders. Especially since the numbers run through so quickly that you are not able to keep track of them at all. For this you should first freeze the time & sales list to identify the small orders.




In the fields marked yellow (point A), the big player has massively bought these small orders from bid. You can see what happened after that with the course. Only at Point B has the big player once again fired a machine gun volley of small orders into the market, and with the stops of the retail traders, the price has finally gone down more sharply. To identify these machine gun salvos, I like to use the sorted Bid and Ask that I showed in my first slide.
Conclusion:

With large lots that come on the ask or bid side, I am able to identify an accumulation or distribution phase. That shows me the long-term course course. The small orders that the big player secretly collects and do not immediately lead to a price change show me the medium-term price trend. As soon as a kind of machine gun volley is fired between 1-3 lots, this often shows the start for a stop fishing and thus the short-term course. The big player likes to work in the equilibrium with this machine gun volley to keep the price within the range. Of course you can't always rely on it, you always have to see the reactions of the big players in the context of the market. However, anyone who can handle this information is already a significant step ahead of most traders. There is still a lot more information to be considered, we will talk more about that in the next few weeks.

Very interesting information can also be generated from the Forex market, which I would like to briefly discuss again. Since there is only half as much data available in the Forex market as in the futures market, traders and programmers have become very creative in the past. The currency strength is an indicator that shows the strength of the respective currency at a glance. In addition, more and more useful indicators have been developed in recent years that can be crucial in daily action. Many traders on FF are among the best programmers of indicators that are used worldwide.




In the forex market, I use a dashboard, which gives me regular information about the market. I adjust this information regularly.

Point A

Here we see the bionics candle in the H1. Crucial here are the pullbacks within the candle, which are marked in color. From this you can quickly derive the strength of a candle.

Point B

These are two indicators that show the currency strength. The upper indicator is for the medium-term range, the lower one for the very short-term range. Green stands for the Euro, red for the Dollar. M1 is my preferred time unit, for the short term area.

Point C

These are the same indicators, but in the M15. Larger time units are not necessary because I tend to work in the short term.

Point D

A self-developed indicator in the M1 that shows me the percentage distribution of bearish and bullish movements within a candle.

Point E

An indicator of the currency strength, which I have modified something. Green means the euro strength in 7 crucial currency pairs, within nine different time units and red shows the dollar strength.

Point F

Here I get different information about the price, the spread, the volatility and which decision meetings can possibly increase the volatility.

Point G

This indicator shows if you had invested 1 lot in the Daily Open , how the gain would have been in the high, the low, and the current price.

Point H

This indicator shows the investment of 1 lot at the respective open in the different time units.

Point I

In the overview the bionic candle is used, the numbers show the respective trend strength of the zigzag indicator with the setting 4/2/1. This indicator has given rise to another indicator that I consider to be very efficient.




We see a picture in the EURUSD M1. First the course runs up to point A. The task now is to draw possible resistance zones in the future, but you only see the price till point A. At first this task seems to be a big challenge.




Most of you know my zigzag indicator, which calculates the individual trend strength. In principle, this is the same indicator, only now the individual zones will colored green and red. Since the candles in the M1 are very volatile, I have hidden them. We see an equilibrium at Point A, after that the course goes up sharply. I marked this zone and you can see that after the course re-enters this zone it was strongly rejected. The other zones can also be drawn in well. We know, the greater the time unit, the more reliable the message of a candle. However, I believe that the candles only help us to a limited extent to determine resistance zones. With the help of this indicator, I have also created a kind of candle that gives me more concrete information. In the picture we see a M1 chart, the candles are hidden, but on average a new zone is formed every 5 minutes. So I have a kind of 5 minute chart, which gives very interesting information. If the zone is narrow, it is a strong price action, and if the zone is wider, it is a sustainable trend. You will receive the latest indicator at the end of the article. With the setting 4/2/1, a different number of zones is created in the different time units.

M1 = ⌀ every 5 minutes a new zone is created
M5 = ⌀ every 30 minutes a new zone is created
M15 = ⌀ a new zone is created every 60 minutes
M30 = ⌀ a new zone is created every 4 hours
H1 = ⌀ a new zone is created every 6 hours
H4 = ⌀ A new zone is created once a day
D1 = ⌀ once a week a new zone is created

I'll talk about these zones again in one of my next posts. The key candle also plays an essential role. I would like to note that you can use this illustration to draw up a rough plan for a possible course, but what is important is the way big players work. I have already described this information, so stock market data is an indispensable tool.


Big Conclusion:

The Forex data are ideal for medium-term to long-term planning. With the colored zig zag zones I am able to eliminate the candles and concentrate only on the crucial zones. The Zig Zag strength indicator shows me the power of a trend and the Bionickerze the strength of the pullbacks, inside the candle. A crucial point is the currency strength, which gives me important clues. In addition, there are many useful auxiliary indicators that often help me. With the Forex data one can sketch a rough course of the course, which however has to be regularly compared with the futures data.


The futures data are ideal for concrete short-term to medium-term planning. With the time & sales list, the algorithms can be read out when the big players collect small amounts of lots. The DOM shows the deleted and added limit orders, which represent the decisive liquidity in the market. The open interest shows the open long positions in the market. Small and large orders can be filtered in the 1 tick chart to recognize what is collected in the equilibrium. The chart shows whether the euro / dollar is being bought or sold. In addition, you can make the triggered stops visible. The future data help me to find the optimal entry and exit.

The Forex data are ideal for long-term planning, the futures data are ideal for short-term planning. Both datas meet in the medium term. If the information is consistent, the probability of a successful trade goes up. If there is different information, you should wait for a better opportunity. The Forex data is good for making a forecast, with the futures data I can quickly determine whether the big players are approaching or moving away from this forecast. For this reason, both data are crucial for a successful trade.

I would like to go back to the randomness of course developments. Of course, the coincidence is responsible for whether a market order at a certain time period at a certain price level leads to a tick change or not. However, we know that the big players determine the price development in the market due to their investments. Therefore, I believe that the small tick changes are fundamentally subject to chance, but not the fundamental direction of the market. This is prepared and carried out precisely by the big players. This allows calculation of the course price without having to consider the coincidence, provided that the correct information from the futuremarket is observed. This is a crucial point that can give many traders hope.

I wish you a successful trading week.

best regards
Michael

[quote=Bionics;12659345] Hi Bionics,
Big thanks for your entire and continuous contributions regarding helping not only the beginners but all level traders to learn,create and exercise their setup/system as they required.
A little correction,all indicators and rest of stuff i posted and will be posting in future as time allows me,is of Mladen Rakic and of Mrtools so all thanks goes to them -

I'm not that good in price action, because I mostly keep an eye on my indicators. Of course, now my attention goes a bit more to my now colored candles, ha ha, thanks to Bionics ...And, when for instance you see a H1 candle forming when 80% of that peticular hour is over and that candle is then a nice pinbar with a long wick under a small body, initially trend was going down, so you think based on price action that price will go up now ...but in the last few minutes of that hour, the formerly nice pinbar suddenly becomes a normal bearish candle on H1 and the bearish trend continues. Naturally you can wait till the hourly candle is over, but then again price action can confuse you. So I see it too when a pinbar is forming on M15 or H1, but then I look what my stochs are telling me on M1, M5 and M15, when those all are overbought, and that's certainly the case when such a 'bullish' pinbar on H1 is forming, well then I will not go long, I would probably already be out of my small countertrade against the trend.

regards from Wulong

Bonnie and Clyde in the Forex market


Hello dear subscribers,

In my last report "The fastest information in the market" I showed which information is the fastest in the Forex and Futures markets. This knowledge is first of all important in order to make the right trading decisions. Since today's report builds on my last post, I recommend working through it first.

The fastest information in the market


The sideways markets (equilibrium) are an important key to success. If you recognize in a sideways market whether it is an accumulation or a distribution, you are also able to take the movement of the stop fishing with you and the subsequent breakout. This means that only price movements are traded that are quick and efficient and thus reduce the risk of a longer stay in the market. The big traders' approach is usually based on the principle: the same procedure as every week.




On the picture you can see the EURUSD in M1 from December 11th. First the price went down and on the morning of December 11 a big player started buying the euro strongly (Point A). A few hours later, another large buy order from Euros came on the market (Point C). First of all, we have to ask ourselves why a big player places a large order in the market when he has to assume that every trading participant will see this large order immediately. I wrote about this in my last post. A big player places a large order only if he is certain that this large order is not directly price-relevant. By that I mean that placing a large order does not immediately lead to a larger spike upwards. That would also be very ineffective because the big player would be predictable at that moment. As we know, the big players are anything but predictable. First, a big player at Point A buys the euro with an obviously large order. Then there is a small stop run down and the course moves up again.

All participants who goes Long at Point A have been stopped. Then the course went up to Point B. Now the big player begins the second phase. The dollar is bought strong, but in such a way that nobody notices it. The big player uses algorithms that buy the dollar in small quantities. The market participants in the market only see big buy orders euro and assume that the price will have to move upwards in the short term. If the big player were to buy the dollar in large lots, the participants would be confused. The big player knows that he will push the price up sharply in the medium term. To do this, he first has to buy a large number of euros. But he also knows that some participants will follow him. These participants must be stopped up before the spike. I described the reasons for this in detail in my last post. So there must first be a stop fishing before the spike can start up. It goes without saying that the big player also wants to make money from the stop fishing. Logically, he has to buy the dollar at the same price level where he buys the euro on the one hand. To keep participants believing that the price is going up, the big player has to buy the dollar in small quantities, which is exactly what happens at Point B.

At Point C, the big player buys the euro again in large quantities. Many market participants go long and are then stopped again. It is now clear to many that it is an equilibrium and the course will definitely go up. The price continues to move in equilibrium and runs to point D. This price movement to point D looks like the big player is now pushing the price up. But now the opposite is happening. With a machine gun salvo of 1 and 2 lots, the big player begins to push the course down. With this, the first stops of retail traders managed to catch up. Then a chain reaction occurs. Every stop that is caught pushes the course further down. In principle, the stops of the retail trailers ensure that they shoot each other out of the market. At Point E, the big player fires a large machine gun salvo from small solder and pushes the course further down. The same chain reaction arises again and in the course of the downward movement, the big player begins to exit the dollar. At Point F there is no longer a participant willing to trade further down and the Big Player starts pushing the course up. After the course has gone down so strongly, traders are hesitant to buy the euro. An ideal starting point for the big player.




Here I have shown the whole process again with my own algorithms in the future market. You can see exactly where the euro and dollar were bought. At Point G you can see that the big player has already withdrawn from the euro with partial positions. After that, the price went down even more. In principle, it is always the same game that is played. As long as it works, it will continue to be played. Only when there are complications are alternatives sought. It was the same at Bonnie & Clyde at the time, only there were no alternatives in the end.




We have found that in the futures market the current price line is the third fastest information and the bid and ask that come into the market in a 1 tick chart are the second fastest. The quickest information about a possible price trend is shown by the limit orders in the market, which provide the liquidity. That is clearly the future, because a trader who gives up a limit order shows the willingness to enter into a trade at a certain price level in the future. Of course, limit orders are also deleted shortly before execution. That is why I recommend working with a headmap that takes into account spoofing in the market. This gives me a good overview of possible resistance and support zones in the market.

So we have to consider three phases of big players. Phase 1 is the placing of large orders in the market that can be identified by every market participant. These large orders show the long-term market trend. This is followed by phase 2, the preparation for stop fishing. That is the medium-term course. Algorithms buy small orders in quick succession that cannot be identified in the market. This is followed by phase 3: the big player shoots 1-3 lots with machine gun salvos and pushes the course in the appropriate direction to start stop fishing. The large orders in phase 1 are easy to identify, so we do not need to deal with them.




With this attitude I identify phase 2, the preparation for stop fishing. At Point A we see the time and sales list, each individual order that a participant has brought into the market is displayed. With the right filtering, you can recognize these small orders that a big player buys. At 22: 59: 00.2590, a larger participant bought 15 Lot Ask within milliseconds. It is possible to combine orders that were bought within a certain millisecond. This makes it much easier to correctly identify phase 2.




Here we see a summary again. At Point A we recognize the large lot that has been released into the market. At Point B, we see the orders summarized in milliseconds that were placed by a larger participant. At Point C, I can more easily identify the machine gun salvos I have described. For this, the individual lots have only been filtered. To recognize the stop fishing, I still like to use a footprint in the 30 second chart, which shows me the triggered stops.

Conclusion:

I don't get the information described here from the Forex market, but only from stock market data. Possible patterns that I see in the chart are in most cases initiated by the big players and give me important information. Overall, I need to be able to read the overall context of the market to increase my long-term profitability. If we summarize all this information, it should be clear that a single indicator is unable to increase my probability of winning. It is also wrong to assume that the market is easy to trade. Indicator winnings are purely coincidental and have nothing to do with the real intentions of the big players.

Therefore, I strongly advise you to refrain from standard indicators and to deal with the stock market data. I have also been successful in the past 10 years, but that was also pure coincidence. However, it was only because I only traded in equilibrium or in sideways markets. The resistance zones I determined were initiated by the big players, which of course benefited me within the equilibrium.

Let us note that it is definitely possible to make profits even without the stock market data, but we have to be aware that this is based solely on chance. If you want to rule out coincidence, you should look at the stock exchange data. A little tip: If you look at the screens of traders from Goldman Sachs or large banks, you will find that only the DOM, the time and sales list and a maximum of one chart without indicators are used there. In order to act successfully, you should work as the successful ones set an example. It may be a big change in the beginning, but it will be a big win in the long run.

The sentence from my last post is so important that I have to repeat it again !!!

It is about the coincidence of course developments. Of course, chance is responsible for whether or not a market order leads to a tick change at a certain price level for a certain period of time. However, we know that the big players determine the price development in the market due to their investments. Therefore, I believe that the small tick changes are generally subject to chance, but not the basic direction of the market. This is prepared and carried out exactly by the big players. This enables a course to be calculated outside of coincidence, provided the correct information is taken into account. This is a crucial point that can give us all hope.

I wish you a successful weekend.

best regards

Damn, I still have a lot to read. Ha, ha, I have read the first pages, some in the middle and some of the last pages of this nice thread. Mostly I'm looking for an indicator I might use and in the mean time I start reading where I find the indicator. When will I have time ? Anyway, next to the bionic candles, the most interesting indicator for me is the bionic percentage balance indicator. I must dig deeper into that one, but after a short time I already have found out it's quite interesting, as it can predict certain moves. It indicates when there is NO strenght at all and mostly that is a sign ...then you simply wait, because then there is a kind of equilibrium and after that price will often choose another direction. And when I get confirmation of my other indicators, I go for it. Do not mind my many moving averages in M1, they do have a purpose (for me), ha ha.

And, 'Bionic Michael' I'm still amazed how you still manage to analyse a certain course of EurUsd to the bottom !

Regards from Wulong

Interpretation and facts


Hello dear subscribers,

First of all I would like to thank you again for your many compliments and confirmations for this blog. Your reactions show that this blog helps you and that is the decisive factor. The blog name "Equilibrium, a key to success" clearly shows my opinion on Equilibrium. It is a key but not the only key to success. This blog was initially created to answer the question myself why I was able to trade profitably with forex data in the past. A trader never knows whether the success arose out of his skill or luck. I still believe that experience plays a big role, but in my case, luck seemed to be greater than my ability.

The big players essentially determine the market with their capital. However, due to the low liquidity in the limit orders, you do not have the chance to buy 1000 lots at once. Therefore, the price is kept in equilibrium in order to acquire the necessary number of bid and ask. The price will be artificially balanced until the big players have finished their shopping spree. This creates alleged resistance zones or patterns, which often end with tick accuracy. The big players know very well that the masses are reacted on these zones and patterns.

Since I only traded in equilibrium (sideways markets) in the past, I happened to have correctly assessed these artificial resistance zones and traded profitably. After that I got out and didn't bet on a breakout. So I acted in a phase when I wasn't dangerous to the big players. Likewise, the big players in the equilibrium pose no great danger, since they first have to pick up their ask or bid. As a trader, this procedure requires getting involved in scalping. And that is a big challenge for many.

What zones and patterns are there?

Candle Patterns (Doji), Pattern Tradings (Gartley Patterns), Resistance Lines, (Horizontal, Vertical, Trend Lines), Resistance and Supports, Channels, Retangles, Head & Shoulder and Inverted Head & Shoulder, Doubletop and Doublebottom, Triangle and Wedges, Flag and Pennant , 123-Muster, Fibonacci, 200 EMA, Moving Average, RSI, MACD, bullish market, bearish market and many more ...

The most used indicators include the 200 EMA, MACD, RSI and the Fibonacci zones. Big player analysts deal with precisely this zone and are able to show the profit traders of banks the possible stops of retail traders. They go one step further. Certain price courses are set up so that it looks as if there is resistance at the Fibonacci or EMA 200 zone. This places the stops of the retail traders exactly where they are needed by the big players. In principle, indicators are an invisible spider web so that the fly sticks there while the spider only has to wait.

The basic question is to what extent can we rely on these zones or patterns?




Here we see the EURUSD in H1. The upper obvious resistance zone is just a small example of why so many traders lose their money. We humans tend to want to create a supposed order within a chaos in order to understand the whole. That is why we work with indicators or pattern recognition, which should help us to resolve complicated price developments. Millions of people trade in EURUSD every day, isn't it strange that the price sometimes stops exactly at a certain price zone and runs in the opposite direction? We know that even a few lots can move the price, so retail traders also have a certain influence on the price. With so many options for course development, it would be very unlikely that a price stops several times at thesame price level. Unless this price is influenced by a big player. Now we come to the crucial question: What are these patterns that we have identified worth? In principle, they are worth nothing unless the big player wants them to be of value to us. And why does the big player do that? To mislead us and take our money. Retail traders are allowed to win once or twice, then they will killed at stop fishing. We know too well that if we won $ 300 yesterday, our brain registers two things.

1. You see it works!
2. Tomorrow we will get more !!

If you would keep the $ 300, everything would be ok, but you will invest the money again the next day and this time the supposed resistance zone is gone and the course just goes through. It's like the slot player who just won a big series. Instead of stoped out, all the money is invested again. And even if all the money is gone, the player knows that he has won before, so he continues. That means we just won $ 300, the question is whether we can keep that $ 300 in the long run.

Let´s talk about to the indicators.

There are traders who work with many indicators and some traders only work with the pure chart image. Now the traders who do without indicators will make fun of the others and conversely, the traders who work with many indicators will be convinced that without an indicator you can only lose. Neither one is right or wrong. There are traders who are successful with many indicators and there are traders who are successful without indicators. Nothing from that is better or worse.

Anyone who takes a closer look at the market will find that the forex market does not provide any crucial information other than the price. The resulting trading decisions are therefore based solely on interpretations rather than facts.

In this blog all traders (who also want it) receive information in the form of experiences, auxiliary indicators and examples. Everyone can create their own setup here and is not pressed into a defined process that they have to adhere to. Therefore, I ask you to accept that everyone can work with their own system and that discussion about meaning or nonsense is inappropriate. After all, it is his own money that he uses here. I would never say that you cannot be successful with a particular system. I only know that this system is not suitable for me. This blog is only about ideas in the equilibrium to create your own setup. If a visitor to this blog tries to advertise their own system, I can only say: Forget it !!! Not because the system is bad, but because the likelihood that other trader will make money with it is very low. And if a trader demands money for his system, I say: stay away !! Anyone who has an idea for a setup is always welcome, but I reject a complete system in this blog. A setup must be created individually by each trader, only that guarantees a profitable future. And that's exactly what this blog is for.

I posted a detailed report on the setup:

The never ending story

The decisive factor is the screen time in which you use your own setup. You need a lot of time and patience for this. Educate yourself and get to know the market, but definitely go your own way.

The following recent posts could also help you:

The fastest information in the market

Bonnie and Clyde in the Forex market


Conclusion:

Anyone who works with indicators must be aware that their trading decisions are based solely on pure interpretation.

Facts: The big players determine the market, so the big players largely determine the patterns and zones that we see in the market !!!!

Let's do an example!




What do we see in this forex chart?

There are now many answers and explanations from different traders and everyone thinks he is right. I personally see in this chart a price that is going down, then an equilibrium and then the price reaches a provisional low. Then the course goes up again. That's all. And why am I no longer seeing? Because I don't know which market participants bought Ask and Bid with what intent when and at what price level. We do not get this information in the Forex market and there are no indicators to show us that. In this respect, all statements that we make are purely coincidental and have nothing to do with the actual process in the market. When we trade zones or patterns, they are influenced and wanted by the big players. If we are correct, it has little to do with ability or knowledge. If we were to rely on pure facts without interpretations, there would be no upward or downward trend, no resistance and support zones, no lows and no highs, no bearish and bullish market and no equilibrium.




We should ask ourselves why the best traders in the world trade with the DOM, the Time & Sales list and at most one chart image. The chart image is only used to see how ask and bid affect the price trend, which is even easier to see in the DOM. The answer is terrifyingly simple: because the big players do not want to interpret a course, only the facts. And that is a crucial difference.

Interpretation means in the general sense the understanding or the subjectively considered plausible interpretation of something that is given or at least something that exists, while a fact is a real, demonstrable, existing, true or recognized fact.

If we interpret an image on which we recognize a certain pattern and the painter actually only has the brush dropped on the canvas, this is not a broken leg. But if we use our interpretation to speculate with our money, that's another matter. I believe that your investments should be based on facts rather than interpretations. Of course, we will always have to interpret in these markets, but with the stock market data we get some facts about the current situation. It is precisely these facts that increase our probability of winning. No more and no less.

I wish you a successful trading week

best regards

Another superb post. In particular, I liked the following:

"We should ask ourselves why the best traders in the world trade with the DOM, the Time & Sales list and at most one chart image. The chart image is only used to see how ask and bid affect the price trend, which is even easier to see in the DOM. The answer is terrifyingly simple: because the big players do not want to interpret a course, only the facts. And that is a crucial difference."


Understanding DOM (the ladder) and time & sales is key to trading success.

Hello, what is the indicator for mt4 is the DOM?

Hello wendvieira,

Welcome to our blog. Since the forex market is not a regulated market, there is unfortunately no DOM or time & sales list there. You only get this data from the futures market. If you would like to know more about it, please start with the following contribution.

Forex versus future

In the course of the further contributions you will also find MT4 indicators as an alternative. However, the indicators in the MT4 are unable to reflect the actual investments made by the market.

I hope you find some information that will help you.
best regards

[quote=corinthia;12665550]

Another superb post. In particular, I liked the following:

"We should ask ourselves why the best traders in the world trade with the DOM, the Time & Sales list and at most one chart image. The chart image is only used to see how ask and bid affect the price trend, which is even easier to see in the DOM. The answer is terrifyingly simple: because the big players do not want to interpret a course, only the facts. And that is a crucial difference."


Understanding DOM (the ladder) and time & sales is key to trading success.


Hello corinthia,

First of all, thank you very much, I absolutely agree with you, unfortunately the display of the DOM and the Time & Sales list is very limited for many providers. Obtaining important information from this is a real challenge. The key is variable filter settings that can be used to divide this information into important sequences. This approach is also used by high frequency traders, although they use extremely better software for it. But in the end, it depends on which data will help you. Filtering the information into different sequences also requires a certain interpretation, which, however can be backed up with facts. We will deal with this filter setting in the next few weeks. It's a big challenge and a lot of work that I would like to share with you.

I wish you a successful week

best regards
Michael

I would like to clarify a bit my previous post. The M1 template you see is my trading template, but focus is on Bionic indicators which I'm testing out, almost all other indicators I will never show, for the simple reason no one but me can trade with it. The M5 template is a test template where I test various indicators, in this case also Bionic ones. I strongly suggest every one should make his own system, but that's not that easy AND you must know it thoroughly and inside out !
Of course, my moving averages and BB also guide me often. The BB360 I'm using already a long time, when price is inside the big period bands, it's in an equilibrium, I have experienced cases where price kept hanging on one of the bands for more than 45 minutes and then boom, the big guys took their preys. When price breaks the BB360 upper or lower band and stays under or above it, it's clearly down trend or up trend. Also in a lot of cases price does respect the band, sometimes not. So, if it does and I get other confirmation, my chances of winning rise. Coincidence or not, or maybe an 'interpretation' of mine, I guess so, but when it helps me, what the heck ? Maybe winning in Forex without the 'facts' and only depending on the sometimes not that correct facts we get from our broker is because of a ' kind of sixt sense', who knows, that one gets after thousands of hours watching charts. I'm also not pretending anyone should use my BB360, but for me it's a kind of equilibrium, so I thought it would fit in here.
So, to some extent I do not agree with you Michael, it's sometimes possible to win without the 'facts', I do not think it's always sheer luck, but I agree that's it's of course much better to have access to real facts like Future data. But for me personally, it's not that easy to understand the 'Dom' or the Times and Sales list, because I'm simply not used to it.
Today, I downloaded the offline tickchart, quite interesting, I must say. I loaded a heavy template on it (all mine are heavy, ha ha) and it was stuck, but with a simple template (I have those too) it works like a rhyme. I especially like the 2 minute offline chart, but that's my first impression, of course, will see how it goes.

Best regards from Wulong

„Interpretation and facts“

[quote=Wulong;12667436]I would like to clarify a bit my previous post.


Hello Wulong,

First of all, I am very happy that you looks at my indicators and that they may help you. That's why I developed it and if you get a trading advantage from it, it would be a great result. It is also correct not to publish your own setup, firstly because it is a personal advantage for you and secondly because no one else could work with it like you anyway. That you disagree about my contribution: „Interpretation and facts“ its completely fine.

Every trader acts on the basis of facts and interpretations, which always leaves plenty of scope for different opinions. The key is to find your personal setup that will make you profit in the long run. It doesn't matter what others say or recommend. So there is no right or wrong. Our subscribers in this blog works varied and everyone acts with their own setup, which they have put together over the years. I am very proud that these subscribers accept the different nature of the other traders and that there is no unnecessary discussion about who is right. I would never say that a setup doesn't work. I can see for myself that certain setups or indicators don't work for me, but that's just my personal opinion. You wrote a very important sentence: It is not so easy for me personally to understand the Dom or Times and Sales list because I am simply not used to it. You put it very honestly. Only when you have made a habit out of the Dom / Times and Sales list will you know if it will help you.

There is a nice quote from Talmund:

Pay attention to your thoughts, because they become words.
Watch your words, for they become actions.
Pay attention to your actions because they become habits.
Watch your habits, for they become your character.
Watch your character, for it becomes your destiny.

This blog should be an invitation for all participants to look outside the box when trading. It is a collection of different modules to create your own setup. This is a bit more complex than getting a finished system in front of your nose, but in the end you created it yourself and tailored it to your personal characteristics. And that's exactly what you do and in my opinion, that's the only and right way.


I wish you success
Michael

Awesome bro its about spiritual

I found the best timeframe for DOM trader is M1, and M5, hihger TF has too many noisey. During low liquidty session the big players are difficult to hide their activities, while, high liquidity session, big players get more confident with their trades, they may hold their positions for longer time, which will create false signal to the market. And other deadly skills like buy/sell at the same time can be apply to the market. Anyway there are less information, the result need many experience, lucky and more guess

Edit: a example of current EurUsd M15

the last Pinbar, as I understood, maybe Bionics had mentioned before, they want the market see the pinbar, is a bait, but some earlier buyer took the bait, if they were not too greedy they can make profit also

The new generation of traders


Hello dear subscribers,


If we still remember the eighties, we see the floor traders on the stock exchange, shouting at each other and throwing 1000 pieces of buy and sell orders through the air. This stock market world no longer exists. In the 1990s, the interbank market became a separate market for banks, detached from the regulations of the stock exchange. This enabled the banks to exchange money with one another without fees in order to remain liquid. After the first brokers received licenses for the forex market, the big players quickly realized that this was a very interesting business. In addition to the retail traders, there were also other smaller institutional traders. The proportion of smaller institutional traders and retail traders is already over 15%. With a daily sales volume of just under $ 6 trillion, that's almost $ 1 trillion in trading volume. I was once interested in how much money is won and lost per day in the Forex market and what the distribution could look like. So I created a vague forecast. I assumed that all participants in the forex market act as speculators, which of course is not the case. That is why this forecast is purely speculative.

According to statements from some institutions, forex market sales are expected to be $ 6 trillion a day by the end of this year. 85% are in the banking market, 10% in institutional traders and 5% in retail traders. In total, 60 million lots are traded per day. In the calculation, I assumed that in the event of a loss, $ 100 would be lost per lot ($ 100,000) (0.1%). This corresponds to a stop of 10 pip. While the big players work without a stop, swing traders have higher stops and scalper have very small stops. I calculated the loss rate of the big players at 10%, the institutional traders at 60% and the retail traders at 90%. The loss rate of retail traders is known, but why did I calculate the loss rate of institutional traders at 60%? Many large companies use the interbank market to exchange money to pay their employees, this is less about profit. In addition, millions of people exchange money abroad every day, on vacation and on business trips. In addition, an institutional trader does not lose 60% a day, but profits and losses change every day. Incidentally, a win rate of 40% is very high if you assume that the average probability of winning in the futures market is 16%.




With these factors, $ 6 trillion in daily sales is generated in Forex, but only an effective $ 1,200,000,000 in loss or gain. The overall result is as follows: The institutional traders lose $ 130 million and the retail traders $ 270 million = a total of $ 400 million. That should be exactly the sum that the big players share among themselves. Of course there are also winners among retail traders with a total of $ 30 million a day. However, $ 300 million a day is lost at the same time. It is obvious that the foreign exchange market is a very lucrative market for banks, optimal for improving their bad bank balance sheets. Some banks earn up to 60% of their annual profits in the forex market. The big players not only have the most money, but also the best market information (volume). Smaller institutional traders have been able to obtain this market information from CLS for several years, but retail traders are lagging behind. Firstly, retail traders have the least capital and secondly, they receive incomplete data. This makes them the weakest link in the chain, and the losses must inevitably be greatest here. The terrifying thing about my forecast is the following result: Although retail traders only make up a tiny 5% share of the Forex market in terms of turnover, they bring the big player 67% of their profits. Brokers and banks work together in this market. Everything is done to support retail traders: Seminars by successful traders, great indicators, competitions and many illustrations of how easy it is to earn a large fortune in this market. Why slaughter a cow when one can milk it regularly?

Despite these market conditions, can a retail trader make long-term profits in the Forex market?

This is possible, but only if he works with the same strategies as the big players. Unfortunately, we lack the necessary money and IT, the only way we have is to follow the big players. We only have to deal with their strategies and try to understand their actions. If you want to travel up or down with the big players, you have to identify them. It starts with the right data, very fast internet connections, high-quality technology, good software and a professional approach. Everything else will not work in the long run unless you have enough money to trade 10-12 hours a day for the next 5 years without output your trading capital. Calculate for yourself, if you make 4% return per month, you need at least $ 100,000 to make a living. If you then deduct 1/3 for taxes, it will be tight. Building up small capital is also a particular challenge. If you have $ 5,000 today and you earn 4% return every month for the next 5 years, you will end up owning $ 20,000 after tax. With $ 20,000 and a 4% return, this equates to a monthly income of $ 500 after tax. You can achieve it with 10% return per month, but probably not with the help of MACD or RSI.

The world of retail traders has changed a bit. Bundled knowledge is available on the Internet in a matter of seconds. The challenge is to filter out the bad information and to benefit from high quality experience. This is the biggest hurdle an inexperienced trader has to overcome. The exchange between experienced traders doesn't make it easier for the big players, the banks are already looking for other ways as their trading results deteriorate. Today's traders are much more informed and critical than they were many years ago. The new growing generation of retail traders is more effective and do not be work for prop companies, but rather earns the money from home. This new generation of retail traders do not need suits, but sit barefoot in front of their screens and trade very efficiently and not according to market technology. Of course, the big players always adapt to a changed situation and come up with new variants of confusion. But this head start will never last long. I believe that we are in the right time in this market. With a little creativity and an efficient approach, in the future more traders will be able to act very profitably in the long term. To do this, one should regularly question and optimize your action strategies. Maybe we're already the new generation of traders and we don't know yet.

Strategy identification

All trading processes begin with an initial research phase. This research process involves finding a strategy, determining whether that strategy fits with other strategies, obtaining data necessary to test the strategy, and trying to optimize the strategy for higher returns and / or less risk. We also need to consider our own capital requirements when executing the strategy as a trader and how any transaction costs affect the strategy. Transaction costs can make the difference between an extremely profitable strategy with a good return and an extremely unprofitable strategy with a negative return. Depending on the frequency of the strategy, we may need access to historical stock market data, including tick data for bid / ask prices. Our success generally depends on the quality, depth and timeliness of the data.

As I wrote in my last two posts, I am currently filtering bid and ask, limit orders and spoofing, as this information is among the fastest in the market. If you haven't read these posts yet, you can find the links here.

The fastest information in the market

Bonnie and Clyde in the Forex market





I once created an example for my current project.

Point A
The time and sales list that only filters the bid.

Point B
The time and sales list that only filters the ask.

Point C
As soon as a tick arises in the market, the liquidity is shown on the ask and bid page at this time. With this, I can see immediately after the tick ends whether the liquidity increases or decreases or whether absorption takes place.

Point D
A very interesting filtering for spoofing. The extent to which limit sell or limit buy orders are added or subtracted is shown immediately. In conjunction with Point C, a good addition to capture liquidity in the market very quickly.

Point E
Different cumulative ask and bid are filtered here, which are summarized in the respective milliseconds. This enables me to identify a medium-term trend change.

Point F
Here we see individual orders from 10 lots, which do not come to the market cumulatively. As a rule, a long-term trend change can be estimated from this.

Point G
These are non-cumulative orders on the bid side of 1-4 lot.

Point H
These are non-cumulative orders on the Ask page of 1-4 Lot. This display shows short-term changes in trend, especially when a big player starts the stopfishing.

Point I
Basically a day candle with the graphic volume. The volume is shown on the left, while the number of trades can be seen on the right. From this, certain anomalies can be quickly identified and a strong participation of the big players on a certain price level.

Of course, you always have to see this view in context and connect it to my main screen. So that you can get an idea, I created a video for you, but the volatility at the time of recording is not very high.





Here I would like to show you an example of why it is important to filter the bid and ask by milliseconds.





We see that at 09: 33: 57.3880 a total of 138 lot bids from a single operator entered the market. These were exclusively smaller orders of 1 to 2 lots. Of course, you could also see this representation in the time and sales list, but the numbers run there very quickly. You can freeze the list and look at it calmly, but then it is usually too late to make a trading decision. In a 1 tick chart with the bid and ask indicator, this order will not be noticed either. Why is that important? The big players only have the habit of placing large and identifiable orders on the market if the order is not price-sensitive at this time. For example, if you collect Ask in an accumulation phase. This collecting phase takes some time and it is very likely that the price will not go up immediately. Price changes that are planned in the medium term are often hidden in small orders.





Here we see another example, at point A a total of 46 lot bids come in within 1 millisecond. At Point B we see the summary, underneath we see further combined orders that are between 23 and 34 lots. At Point C, I once presented the non-cumulative larger orders that came into the market at the same time and that everyone immediately noticed. These orders are significantly smaller and give the impression that there is no great interest in trading downwards. Of course, we must not forget that a bid order can also be a euro sale. To identify this, I work with an individual filter setting.





I have created a new main screen for the filter setting of Bid and Ask.

Point A
Here we see an individually compiled DOM. In addition to the volume display that differentiates between bid and ask, we see the current liquidity with the limit sell and limit buy orders, the cumulative bid and ask that came into the market and the identification of spoofing.

Point B
A custom zigzag indicator that shows the volume within a trend. This representation is a very interesting view, which we will talk about in more detail. Below we see the volume delta.

Point C
We see a 2 tick chart with an individual filtering that helps me to find out whether the euro / dollar is currently being bought or sold.

Point D
My time and sales list, which was individually filtered here.

Point E
The open interest to identify all open long positions in the market.

Point F
Representation of a footprint in a 30 second chart to identify the stopfishing.

Point G
The display of bid and ask in a 1 second chart for better identification of cumulative orders.

Point H
A forex chart in the M1 with my supply and demand indicator to better identify possible resistance zones using my key candle.


To get a better impression of this, I also created a short video.





You may be wondering why I am willing to discuss profitable strategies, especially when I know that others are copying it and could potentially override the strategy in the long run. The concern is unfounded, as a trader would never be able to deal with my parameters and voting methods. These optimizations are the real key to making a relatively mediocre strategy highly profitable, and every trader has to find this tuning for themselves. Nevertheless, this blog gives you one of the best ways to create your own unique strategies, find similar methods, and then carry out your own optimization process. In principle you get the same Formula 1 car as Michael Schumacher, you just have to tailor the setup of the vehicle settings to your needs. And that's also logical, because every trader interprets something different. In order to be profitable, every trader has to create his own individual setup. And you will find many ideas for this in this blog, regardless of whether you trade futures or forex.

I wish you a successful week

best regards
Michael

Well, well, I thought my system was complicated, and the few people who have seen it were at first amazed how I could trade with it, but when I look at your videos with the testscreen overview and the bid and ask beast, well, I think : how on earth can someone trade with that, I do not know where to look first. I do not think a pilot has that many buttons and parameters ….no kidding ! And everything goes that fast ! Especially with the tickcharts, that I have experienced myself now. I have this RSXBO, I call it like that because I used it with success in my Binary Options time and it's still my favorite indicator, no matter what. Every single time, that RSX is oversold or overbought, price reacts. So price will go down when the RSX is above level 75 in a 8 period tickchart, but the effect is of course minimal in a 15 min candle, hence the price up and down fluctuations within a single higher timeframe candle. Ha, ha, sorry for my enthusiasm, it's the first time I'm using a tickchart...
Anyway, Michael, thanks for your nice previous reply.

And I still have some questions, but that's for later, it was a long day, time to sleep.

Sleep tight !

Facts

[quote=Wulong;12671323]Well, well, I thought my system was complicated,

Hello Wulong,

I agree with you, the difference between forex and futures data is comparable to switching from a car to an aircraft cockpit. Of course, flying an airplane is more demanding, and training as a professional aviator also takes a few years. A car has only two dimensions: forward / backward and right / left, while for a aircraft a third dimension is added: up / down. This third dimension makes learning flying so difficult, while flying a helicopter is another challenge. The third dimension in the future market is the bid and ask as well as the liquidity through the limit orders available in the market. Extracting and filtering this data gives the impression that it is very complicated. To identify anomalies or patterns, you have to go deep, that's why this project was created. If you want to use the data from the futures market for trading in Forex, the way to get there is difficult at first. Starting with a forex tick chart is a good approach. The information you get from it is very valuable to work with the future data later. The whole thing is an ongoing process, the more you deal with the data, the more you understand how it correlates with each other. That takes you one step further every day.

The main goal of a trader is to replace the interpretation of data with facts. And it is the facts that ultimately increase our probability of winning.

best regards
Michael

Hey, Bionic Michael, today I was home, children were at school, my wife was working, so I had some time to change my system and watch how it runs. It's always very dangerous to change your system because your eyes and more importantly mind has to adapt to it. That's why I have a good habit to being very cautious in the beginning. With my previous system, my best performance was last October, then I made 46 scalping trades, won 40 and lost 6. I mostly applied 0.10 lot, some 0.20 lot and when I was very uncertain, 0.03 lot. I'm very good in closing my trades, mostly at the right moment, when I earn 3 - 5 Euro, I simply close. My entries are not as good, then I have to wait till price gets friendlier, ha ha. My principle is, fast in and fast out, I'm much used to that stuff, in my BO period I always traded 3 minute expiry.
The vast majority of traders do not like to trade from M1, much too noisy, but I had to, I simply have no time to trade from a 1 hour chart. I do have a H4 chart open, also a H1 chart, a M15, those I hide and I occasionally look at them too see the 'trend' and to know where the SR lines are. Bah, I do not like the word trend, and I'm right, in a 8 period tickchart, where is the 'trend' ha ha.
Now, I applied my M1 chart to 2 tickcharts, one is a 8 second tickchart (or 16, or 32), the other I switch between 64 and 128. My normal M5 chart is always on my screen, that's still a normal one, that one should be my 'guide'. So my normal M1 chart, where I used to trade from, has gone, my M1 system I'm using on 2 tickcharts now. I just have to adapt my indicators a bit to a smaller timeframe, but not that much as you would switch from a normal M5 to a normal M1, for instance, that must be due to the fact that a tickchart is not a normal timechart ...
I would like to trade from my tickcharts and raise my lot, so I can trade faster. Normally I always trade for real, because trading in demo is a loss of time and is NOT the same as the real thing. So when I use a new system(or when I stop trading in Spring for some months), I simply lower my lot to 0.01 and when my win-loss percentage is good, after some time I raise my lot.

Now some questions : I read somewhere in this thread that you trade from T08 in order to scalp, is that still true, or do you have another 'basic' tickchart ?

What lot are you using ? Or do you change that too when you are not that confident in your trade ?

What do you think about not using stop-loss ? I occasionally do that when price goes against me, all the times I got away with it, because I was pretty sure price would come back to me. When I'm not sure I simply close with a loss. Of course I would not recommend anyone to not using stop-loss, it's potentially very dangerous. In my case, I have always a small account, start with 100 Euro, when I get to 300, I retrieve 200 and start all over again with my small trades. And when price goes against me very much and I have the risk of losing my account my broker sends me the following message : "When Please be aware, if the margin level falls to or below 50%, any or all of your open positions will be closed automatically." I know also some traders who do not use stop-loss, but those are very experienced.
Anyway, without stop-loss the big guys can't get your stops, ha ha, but you do not laugh anymore when your account is depleted ...

This afternoon there was downtrend on EurUsd and when I watched my T08 tickchart, I saw gaps when price made some upward moves within the downtrend. Does that mean that there is a lack of liquidity, so the upmove is fake ? I did not see that when there was a downmove ?

Where do you get those Future data, from the platform Atas, or are there other platforms or ways? I know Atas costs about 70 Euro per month, of course I would have to raise my lot, since I have not much time to trade and I only perform very short trades.

Maybe there are already some answers in this thread, but I haven't find the time to read it thoroughly yet.

Best regards from Wulong

Last Friday, there was a long course down on EurUsd, while I was watching my new toy, a T08 tickchart and I saw the pair was definitely in an equilibrium phase. Then price could do two things, either going further down or going up. It was at the same time at an important SR, so it choose to go up. A bit earlier, there was also an equilibrium, but then price went further down. Here a pic of an T08 tickchart and also a normal M1 chart. I looked at the same time at higher timeframes, but the higher the timeframe, the more difficult it is to spot this equilibrium. So my conclusion is, that a fast tickchart is a good tool to spot possible reversals. And I thought that everything started from M1, no way !

Answers to all questions

[quote=Wulong;12672727]{quote} Hey, Bionic Michael, today I was home,


Hello Wulong,

First of all, thank you for your extensive questions. In the past 2 years I have published about 1300 A4 pages of articles including pictures in this blog. I estimate the total effort for research, Excel calculation, image creation, video recordings, text writing and translation to be around 3,600 hours. You put it aptly: Maybe there are already some answers in this thread, but I still don't have time to read it thoroughly.

Within my blog you will find concrete and very detailed answers to all your questions, so I ask you to work through my posts in peace. As you wrote yourself, some posts in this blog have already helped you. The likelihood is very high, that you will find more ideas to achieve your goal.

If you have any further questions afterwards, I will of course help you.

I wish you a nice weekend

best regards
Michael