The Equilibrium, a key to success!

Who is faster the euro or the dollar?


Hello Subsciber,


As we have already stated, the price movements in the forex market are due to pure coincidence. Markets are rarely determined by news, but usually by the strategies of big players. No one is able to predict the course of the price and to determine exactly. In a randomly generated market, you have a realistic chance of making the odds in your favor. But that's exactly what you need the right information for.

Why stock market prices are rising more slowly than falling

It seems like bewitched Stock prices seem to be rising in slow motion over a longer period of time sometimes and suddenly there is a very rapid and strong downward movement. This movement seems to be stronger and more intense than the previous price increase. Within a much shorter time, a spread is sold off, which previously took a much longer time to rise. To get up in the stock market everybody have to take the stairs and after go down with a fast lift. This behavior is not untypical in the stock market and there are good reasons why these patterns occur again and again.

Most investors going Long in equity markets and expect rising prices. These positions are hedged with stops. If these stops are at obvious technical course levels and a short-term downtrend reaches this stop, it may trigger another downswing.

It is no longer a secret that bad news spreads faster than good news. There is a risk that bad news will be priced in faster than good news.

With rising prices in the stock market, more and more money is needed to actually acquire the position, because the share is always more expensive. The application of these funds often requires a certain time. Selling is relatively easy, because no money is needed, but the money is posted back to the safe deposit.

Confidence always arises very slowly, but disappears very quickly. To invest money requires a share to trust. Investors who have put their money into funds, usually withdraw it only in the loss phase, since they no longer trust the fund. This forces fund managers to sell positions at unfavorable times to pay off investors. As a result, there may be further selling pressure in the market, driving prices further down.

This behavior is typical for the stock markets and occurs again and again in certain market situations. Now I have asked myself the question, how this is in the forex currency market. When I buy the euro in the foreign exchange market, I sell the dollar at the same time, and when I buy the dollar, I also sell the euro. So, when I buy the euro, I expect prices to rise, and when I buy the dollar, I expect falling prices. I now wanted to find out whether there is a similar pattern of behavior in the EURUSD in order to gain insights.



In order to be able to make a representative statement, I have examined a monthly chart of the EURUSD since 1971. A zigzag indicator with the setting 8/4/2 are used here. The numbers you see above or below the peaks indicate the average pipettes of a candle within each time period. In the last 558 months, there have been 17 uptrend and 17 downtrend. Let's take a closer look at these trends.



Under point A you can see the 17 different uptrends, under point B the 17 different downtrends within the last 558 months. The first uptrend in 1971 went over seven months and the candles had an average size of 3520 pipettes or 352 pip. Since the indicator represents the average number of pipettes I would like to use this in the following examples. Within 558 months, there were 329 months of average upward trends with a total of 510,869 pips. The downtrend was over 229 months with a total of 457,158 pips. The difference of more than 50,000 pips corresponds to the difference between the currently current price and the starting price from 1971. Already here we can already guess that the downward movements took place much faster than the upward movements.



On average, an upward candle had 2077 pip for 19 months, while a down candle had an average size of 2879 pip for 13 months. This gives a result of 39%. This means that the bearish candle has gone down 39% faster on average than a bullish candle has gone up.

The uptrend lasted an average of 19 months while the downtrend lasted 13 months on average. Normally, within this equation, one would have to look at what the bearish candle would have achieved within 19 months in order to derive a concrete derivation, but I have renounced that for reasons of efficiency.

Under point B, I divided the total number of pips by the number of months. In the bullish movements we come to an average of 1550 pip and in the bearish movements we come to 2000 PiP, which on average has reached the respective candle. This is a result of 29% in favor of the bearish candle.

Conclusion:

Personally, with this comparison I can see that the downward movements are between 30 and 40% faster than the upward movements. This is an important insight because I believe that the longer you are with your position in the market, the greater the risk of being stopped out by an unexpected strong move.

If I put in this case only a downtrend within the EURUSD, I could reduce my time in the market by 30-40%. Provided that the price movement would continue to behave in the same way in the future.

Surely everyone can still remember the Franken Schock in 2015, where the price went down in seconds by 22,000 pipettes. For those of the traders who only bet on a downtrend, this breakdown would not have been a problem. The curious thing is that there has never been such an upward movement.



For me personally, this question of security does not arise, since even as a professional forex trader, I can never lose more than my deposit within my brokerage account. But as a scalper, I have to ask myself which strategy I can best manage, within the shortest possible time, to negotiate my lowest risk trading. And the likelihood of reaching my goal faster is 40% higher in a downtrend than in an uptrend. Of course, this is not a reason for me to focus solely on downtrends, but it is an important insight, which advances me in my money management

Next week, I will put together the odds and assumptions, to make an interesting strategy to increase the overall probability of winning. This enables each of you to optimize your individual likelihood.

I wish you a nice weekend and a successful trading week

best regards

Increase our hourly wage?


Hello dear subscribers,


Because the price movements in the forex market are purely coincidental, we can only increase our odds on the basis of probabilities. However, before we put together the different probabilities and assumptions about an interesting strategy, we still have to deal with a probability. This is about our hourly pay, or how much pip we can achieve in the different time units within a certain time. As always, the calculations made here are purely hypothetical and may differ significantly from reality.



It will be clear to each one of you that there are different trends within an upward or downward trend. This can be seen at the latest when you install a zigzag indicator with the setting 4/2/1 and 8/4/2 in a chart. Today, we want to take a closer look at these different trends. Ten different trends in different time units should be compared. In addition to the seven known time units from D1 to M1, I added three more time units in the tickchart. T32 is approximately the 30 second chart, T16 is approximately the 15 second chart, and T08 is roughly the 8 second chart. A tickchart has the habit of forming significantly more candles in the event of high volatility and forming significantly fewer candles with low volatility. Thus, no unnecessary space is wasted in the chart at lower volatility.



The example given here uses an average ATR of the last 10,000 candles. The average ATR in D1 was 82 pip in the last 10,000 days and 4 pip in M5. This means that 0.06 Pip per minute in D1 was achieved and 0.81 Pip per minute in the M5. The resulting pip size was 82 Pip in the D1 and 1166 Pip in the M5. The T08 shows here with 5774 Pip the largest fluctuation range. It is quite clear that the number of this Pip within a day can never be reached in the trade.

The following calculations are purely averages and of course change daily. With a zigzag indicator with the setting 8/4/2 there are 25 trend lines in the M5 on average per day. On average, 12 candles and per trend line average 12 pip. Which does not mean that each candle reaches an average of one pip, as there are both bullish and bearish candles. If you were to trade these 25 trend lines per day correctly, you could achieve 300 pip. On average, a trend line runs just under 1 hour, and 0.2 pip are reached per minute. These 0.2 pip are an average for the whole day. From 09: 00-11: 00CET and 15: 00-17: 00 CET there is the biggest volatility within EURUSD. In the morning, Frankfurt and London are in the market, in the afternoon New York, Frankfurt and London. Within these 4 hours you can more than double the pip size per minute. So we come to a value of 0.5 Pip per minute in the M5. Since we want to compare different trading transactions, today we will only refer to one scalper. Only five time units are possible: M5 to T08.



In the first case it is about 2 minutes to act in all five time units. We enter into ten trades, seven of which trade profits and three trades lose. The ATR is supposed to be the size of the stop and the spread is 0.5 Pip. The risk results from the stop plus the spread. We calculate with the average Pip per minute, which are achieved in the respective time unit. Of course, the trades are not all started at the same time, we wait for a new trendline to emerge. Within 2 minutes, different sizes of pips are created, resulting in a different risk-to-profit ratio.



The result, in a calculation of 1 lot we can now see in the graph. Interestingly, it can be seen that the range goes from $ -115 to $ 200. However, one should also note here that the greater the risk profit ratio is the less likely it is to actually achieve that goal.



In the following case we want to trade the respective trend lines within the highest volatility. We know that in the M5, a trendline lasts about 60 minutes. Within four hours, four trendlines are eligible, of which we choose and trade half of each trendline. 50% of the trades go into profit and 50% are lost. We take the average pip that is reached within the trend line and the ATR is the size of our stop. The odds ratio is 1: 4, except in the M5 there is 1: 2.7. So we have almost similar starting conditions.



As a result, we will see that in the five different time units with about 120 minutes the same time was traded. The number of trades is different, only two deals have been completed in the M5 and 24 trades in the T08 . The profits are between $ 70 and $ 300. It becomes interesting, if one from that calculated an hourly wage. The hourly wages vary between 35 and 148 $. In my penultimate post, I showed that the downtrend is 30-40% faster than the uptrend. If you bet on pure downtrends, you could raise the hourly wage to just under $ 200.



Since I prefer the T08 to trade I would like to make a comparison with the M5. Compared to the M5, I get 87 times more candles, so I can learn faster, if my created resistance zones are correct. With 282 different trends per day, I have 11 times more chances for a new trend. For every trend line I get up to 8 times more candles. Although I get three times less pip, I can get the same result in 15 minutes instead of 1 hour. In the T08 I can reach almost 4 times as much as in the M5. Within a day I get 12 times more trend sequences and have to wait an average of 5 minutes until a new trend arises. In the highest volatile time, I can earn 4 times more. Instead of $ 0.58, I can earn $ 2.46 per minute.

Of course, this approach is only one side of the coin, many things are crucial in order to be successful in the long term in this market. This representation does not mean that one succeeds. I just wanted to show once that you have to deal with many things in a market that arises by accident.

After this probability calculation, this week I will deal with all the points that may be responsible for optimizing your personal profit probability.

I wish you a successful trading week

best regards

The world of scammers in the stock market


Hello dear subscribers,


There are approximately 5 million private traders worldwide who dream of becoming a successful trader. Unfortunately, according to statistics, only 2% (100,000 traders) will manage to live long term trading. 3% (150,000 traders) may earn a small additional income, but can not give up their job. And what are the other 4.75 million traders who have tried their luck on the stock market or in the forex market and possibly lost many $ 1,000? Well, most people will admit that they are simply not fit for it and will look for another job. Across Europe, the fraud rate is 1.15%, and if we set that rate around the world, just under 55,000 unsuccessful traders will consider how they can make a lot of money in the stock market environment without trades.

What is fraud?

1. Deception about facts
Objectively, there must first be a deception about facts. Basically, one can not be fooled about future circumstances, as far as the future circumstances do not already contain a probability statement.

2. The error in fraud
For a mistake it is necessary that the "deceived" has made a concrete idea. This misconception must be based on the deception act.

3. The Property in the case of fraud
Without this requirement being reflected in the law, it is recognized that in case of fraud, the deceived must make a disposition over their own or another's property. An injunction is any action that directly affects the assets.

4. The damage in the case of fraud
Due to the property order a damage must have originated. For the calculation of a loss, the value of the assets before and after the erroneous property decision has to be compared. If this comparison results in a negative balance, there is damage.

A fraud can be imprisoned for up to five years or fined. Unfortunately, this does not prevent many scammers from harming other people. What motivates a scammer who dreams of succeeding as a trader and receiving the recognition he would like? After a few years he realizes that he did not manage to defend himself against the market. He has lost some $ 10,000, but he has collected a great deal of information about the market during that time. He has an advantage over many beginners, a supposed experience. This experience is not worth anything, but nobody knows that. Now he wants to reclaim his lost money with the experience he has gained. This releases criminal energies that are used for his own benefit.

Curiously, most traders claim to be successful, but only 5% succeed, 95% inevitably have to say the untruth. Is that already scam? In principle, these people only cheat themselves and as long as they do not lose themselves in the assets of the other traders, that is up to each one. Nevertheless, it is dangerous when these traders claim to have found the holy grail and other traders animate their specific system 1: 1 copy. Many traders are beginners, but they are not stupid and recognize quickly to whether it is worthwhile information or not. Applying the fraud statistics to the 600,000 members of FF would bring the alarming figure of 6,900 fraudsters to light, wholeheartedly hoping that this assumption is wrong. Statistically it would be right.

There is a saying that nothing is in vain, not even death, for it costs our life.

This platform FF is an excellent knowledge base and interesting knowledge spreads incredibly fast. This is also very important as the big players have huge advantages over the private traders. I'm convinced that the big players are having a harder time each year in this market, as traders have started to share their knowledge. But this knowledge is also known to the big players and so you have to come up with new strategies over and over again to get the money of the small traders. While retail traders account for just 5.5%, retail traders lose most of their money, and it's easier to fool a private trader than an institutional one. This makes the market more complicated and difficult every year, and it has become a real challenge to succeed in this market. This means that every trader is forced to relearn every day and optimize his strategy. It's like in Formula 1, with a racing car and the experience of the nineties one would have no chance today.

The insights that we have today may only give us an advantage for a few months, after that we have to rethink. The consequence of this: In the long term, only those people who have the creativity to adapt to this market will be successful in this market. This is one of the reasons why EAs only work over a period of time and are worthless afterwards. Actually, one should pay for an EA only if one make even profits with it. (If one need such an EA at all)

Let's think about it for a moment, when a trader has found a system that earns 10 pip per day, why should he re-sell that system for money? If he trades this system with a lot, he earns $ 1000 a day. If this system is good, it can also increase the number of lot to ten or 100 a day. He could earn $ 10,000 or $ 100,000 a day. That's more money than he could ever earn with seminars or EAs sold. Perhaps the trader does not trust his own system and therefore sells it. In principle, we only sell when we no longer need something or when we can no longer afford it, or to make money from it. We should think about that.

Of course, there are exceptions, professional programmers who can help institutional traders with their work, but one has to assume that these EAs are incredibly expensive and not payable. If we take a closer look at the market of seminars and EAs, we will see that 95% of the offers are actually belong directly in the garbage. It is enough to watch some videos in Youtube.

The bad part is that it is made very easy for the cheaters. Even if you do not have a clue about investment strategies and stock markets, you can become an absolute stock market guru and gain a fortune within a few weeks, despite the lack of knowledge. The following story is not an invitation to cheat, but a sad example of a cheater who was arrested. His plan was to start a stock market information service and get worldwide e-mail addresses from traders. Now 96,000 traders are contacted. Half of the 96,000 traders get an email stating that the EURUSD is going up next week and the other 48,000 traders are told that the EURUSD will fall next week. Suppose that the EURUSD fell the following week. Now one start again a mailing and write exactly these 48,000 traders who have previously received a correct market assessment. 24,000 traders are forecasting an increase in the EURUSD and the other 24,000 traders are recommended to bet on a falling EURUSD. If one have sent this newsletter five times using the same principle, one have 3000 subscriptions left, which get predicted five times in a row, a correct course prediction. If one can convince 50% of these 3,000 traders to pay $ 2 a day, $ 720 a year, for this newsletter, one are a millionaire. You see how easy it is to cheat, that's why I find that the penalties are far too low. The scams that were attempted in this case went awry, as some addressees simultaneously received two different predictions of the fraudster and filed a complaint.

Some who are unsuccessful begin to give seminars, or steal indicators, reprogram them, and resell them for expensive money. Some also make a deal with their broker and, when you broker a client, get a share of their lost bet. The list could be expanded significantly, but I leave it here. The fact is, we have to expect that in the Forex market around 55000 fraudsters are traveling around the world. Of course, not all trainers and sellers of indicators are scammers, but one should always be critical at first. How many times have we ever bought everyday items that were junk because we did not get detailed information. Even positive reviews on the internet are becoming more and more fake today, which does not guarantee a good product. A common sense, detailed research on the internet and communication in FF can save you a lot of trouble. The older members of FF, who have been around for years, know the market like no other and know exactly who belongs to the black sheep. Unfortunately, there are also people here who are not registered as a commercial member and still sell their EAs and seminars in the background. As soon as they know, I would recommend them to report this immediately to keep this forum clean.

Not every unsuccessful trader needs to be a scammer at the same time, but a cheater is definitely an unsuccessful trader.

And for cheaters who want the hard-won beginner money, there should not be room in this forum. Once you get an offer, just post it to FF and ask if it's reputable, there are at least 600,000 traders who can help you out.

In trading I prefer to lose my money to a big player rather than a cheater. With the big player I have at least a small chance to win, with the cheater I can only lose.

The fewer illusions we admire, the more we can absorb the truth.

I wish you a clear view at all times

best regards

Sadly all very true.

Your example story of the EURUSD email scammer is exactly how scammer horse racing tipsters work.

Hello lemercenaire,

I did not know that there is such a thing in the horse race, it's amazing how creative these people are. I also believe that a scam in the 3377 qualified Impact Members who are here at FF have less chance of getting their way, as members have some experience.



I was shocked by the fact that FF has more Commercial Members than Impact Members. 4633 commercial members versus 3377 impact members. Of its 8008 members, this is almost 60%. Should not that be the other way around? Perhaps the more than 600,000 members are enticing, which is an average of 129 members per Commerzielles member. However, I believe that this forum is almost entirely led by the impact members who have great ideas and are also free.
In one of my posts I once tried to list experienced and diligent members.

https://www.forexfactory.com/showthr...0#post12439410

Actually, there should be a facility that closely scrutinizes the commercial traders to meet certain minimum standards. There are certainly exceptions that bring added value to us traders. Advertising brings little, in my opinion, a thing that is really good spreads faster than the best advertising.

But the biggest platform in the world does not only seem to be a goldmine for many commercial members, but also a goldmine for ideas that are stolen by non-members and then sold on the market for a lot of money. The first stock exchange opened 600 years ago and since then millions of people have searched for the optimal system or the holy grail. There were some good approaches, but never lasting. Therefore, no significant progress will be made also in the next 600 years. Of course, the stock market and trading platforms will continue to evolve, but little will change in the overall situation.

Why did Michael Schumacher, who was 7 times Formula 1 World Champion, earned so much money? Because no one was able, to build a Formula 1 vehicle that would have surpassed his driving performance. And that's exactly what it's like when trading. The best indicators, stock market data and trading platforms are of no use if the user in front of the screen is not able to read the market correctly.

Because of this, one can save himself the money to give it to someone who promises one high profits. There are awesome and successful people, like you in this forum, one have to make a little effort to find and understand them, but in the end it may be worth it.

best regards

Excellent.

Do you have any statistics based on Bid and Ask Order Count Metrics?

Maybe an Mt5 indicator (for futures) or MT4 EA coded on three parameters

Direction: Up or Down

Order Count: Bid Count or Sell Count in Number

Exit: by pips or points

The idea is to assess the strength of the currencies from the Bid or Ask Count or a gap between the two.

[quote=simnz;12502798]{quote} Excellent. Do you have any statistics based on Bid and Ask Order

Hello Simnz,

Your idea is very interesting, but could be dangerous as an EA in Forex market with a high probability. For this, I will publish a bigger report tomorrow, so I ask for some patience. The statistics I have created are based on the pure price and time within the forex market. Although these two values (price and time) are correct, the values of volume and number of trades are missing. However, these values are crucial for a correct entry or exit and are only available via the stock exchange data in Euro FX. Although I trade in the forex market, my information comes exclusively from the stock market. An MT4 EA would have to use the stock market data to make correct trading decisions. I would like to post an example.



Here we see the Euro FX in the 256 Tick Chart. The numbers we see within the different candles is the number of seconds the price has been in the different price levels. At point A, we see that the price in a demand market was the longest in this price category and then went up sharply. Interestingly, when he returned to this zone, the price was turned upside down in that area. At point B and C we can observe the same phenomenon. With a special indicator that can variably analyze all clusters according to bid, ask, delta, volume, ticks or time, I have made some personal settings. The different setting options are almost unlimited. The clusters in bid and ask were analyzed here within the bearish and bullish candles. The green and red triangles (points D and E) indicate a respective imbalance of at least 50% / -51% between Ask and Bid. Interestingly, although there is no volume in the chart, the entries and exits are very obvious.

For more than a week now, I create a summary of my different probabilities to derive a strategic recommendation for our subscribers. I hope to finish this summary by tomorrow afternoon. I am convinced that the information can bring us further progress. Maybe this could be a new approach.

Lovely wishes

Am I correct in thinking that ticks substitutes volume and your analysis is based here on this factor.

Your research is very interesting.

Hi friend, Bionics.
Congratulations on this very rich work of highly relevant information for us traders.
I am very impressed with your work, I am studying and knowing all the material that is available, I want to know your work deeply.

Let me tell you about an idea I have, maybe you already have material and indicator available, I don't know yet, but ... can you create an indicator that warns in advance of the candle's high, low, open and close? with maximum precision.
I'm sure and I know this is possible .... do you already have any indicators that do this?

thank you very much
continue your work is very important
Success

[quote=RogerS2019;12503029]Hi friend, Bionics. Congratulations on this very rich work of highly relevant information for us traders.

Hello RogerS2019

First of all, welcome to our blog: Equilibrium, a key to succes. I am glad that you like this blog and I would be glad if if it helps you. Unfortunately, I have no idea about your indicator, but I have an idea who can help you.

I want to code your EAs and Indicators for no charge

There are capable and professional programmers in this blog who have programmed many MT4 indicators for free. There you will definitely find a solution.

I hope that I could help you
best regards

Hello Simnz,

Thank you very much for your kind compliment.
the example shown by me in the 256 Tickchart are stock market data from Euro FX. In this case, the respective candle size indicates, among other things, the number of trading transactions; in a volume chart, the candle size depends, among other things, on the volume. In the forex market, a tick chart is already very close to the volume, but a tickchart refers more to the number of trades than to the volume. Since the proportionality of trading transactions on average has a similar ratio as the volume, an approximation to an actual volume is conceivable. Unfortunately, there are no concrete volume data or a number of trading transactions in the forex market, so the tick data in Forex is only a forecast of a possible volume. In my posts

Important information about the volume

and

Amazing discovery in volume


I have shown that a volume calculated from a forex tickchart gives more accurate results than the volume delivered by the broker.
Nevertheless, I would rely solely on the volume from the futures market.

best regards

Hi Bionics, I admire the work you are doing here in this thread, I wonder if, you have another space to share info about the market.

Also I see that you are reading this forum and I wonder if, you have read the FF's "Trades" tab above and have more statistics to share from the traders sentiment.

I am not sure, but I would like to see how you are incorporating retail forex sentiment with your supply/demand tick chart analysis.

Have this on your future plans maybe. Thanks!

The best chance to win

Hello dear subscribers,

In 1973, the theory of Efficient Market Hypothesis (EMH) became popular through the bestseller "A Random Walk Down Wall Street," written by Burton G. Malkiel. The thesis: Financial markets are efficient insofar as existing information is already priced in and therefore no market participant is in a position to achieve above-average profits through technical analysis, fundamental analysis, insider trading or otherwise. Above all, a vivid conclusion of the EMH, which the professor formulated at the renowned Princeton University in the US state of New Jersey, still provokes the experts today. Thus, the unpredictable nature of short-term changes in stock market prices causes a blind monkey to throw "darts" arrows at the financial pages of a newspaper, thus creating a portfolio that would be as successful as one that has been carefully selected by experts. Malkiel argues that asset prices tend to show signs of accidental change and that one can not consistently outperform market averages. In 1984, Warren Buffett gave a speech at Columbia University refuting the Efficient Market Hypothesis. After all, Warren Buffett is not a trader, but an investor.

thesis
No investor is able to outperform the market in the long term because the market can not predict future news and its impact on prices.

antithesis
The practice is not interested in the theory of the efficiency of the markets, numerous successes of investors prove this over many years.

Christmas 2010 Hanover has written a very readable report:

Twenty-six widely believed forex myths.

I recommend you to read this once.

Hanover writes there:

It's highly unlikely that you'll find a simple, mechanical system that allows you to win consistently, especially in the retail arena. If such a system existed, then everybody would use it -- or something conceptually similar -- and obtain exponential account growth with minimal knowledge, effort or stress. Large institutions could save themselves millions in salaries by dismissing all of their highly paid analysts, economists, veteran traders, math and statistics professors, and IT experts, and replacing them all with this simple system. But FX is a (pseudo)zero sum game: to remain handsomely profitable, you must effectively outwit, outplay and outlast the most knowledgable, experienced and ruthless minds in the industry, all of whom want to take your money, whether by fair means or otherwise. Ultimately then, it's not about systems, but underlying knowledge and hands-on experience.
However, the fact that non-randomness (or "inefficiencies") exist doesn't automatically mean that it's always possible for the retail trader to exploit them profitably. Spikes that occur the instant that red news is announced is one such example. Conversely, to whatever extent inefficiencies like those listed are exploitable, and to the point that transaction costs are overcome, it is mathematically possible to profit systematically from trading. In reality, "randomness" is a euphemism for either a lack of information; or a lack of knowledge about what information is available, and how to use it profitably.

In fact, "randomness" is a euphemism for a lack of information; or lack of knowledge about what information is available and how to use it profitably.

For this reason, there are only four factors for me with which I can improve my profit situation. A good psychological condition, a very good strategy, an optimal money management and a reasonable probability calculation. In the last few months, I have calculated different probabilities and made a summary that is interesting for me. I agree that the summary is very comprehensive, but there is no simple mechanical system on the stock market that can be profitable in the long term. Remember, the stock market has existed for more than 600 years. How many analysts, traders and scientists have tried to find a generally applicable profitable system during this time. This gives every trader only the chance to implement his many years of experience.

My system and probabilities, which I describe below, are profitable for me because I have worked on them over many years and have continually optimized them. A profitable system on the stock market has to be thought of as 100 different spices in the kitchen. Sometimes 3 spices are enough to cook a dish and sometimes you need 20 spices. I do not work with a particular system, but with different strategies in different market situations. It is not the indicator, which is just another representation of price or volume, that is responsible for success, but man. In doing so, I draw on my many years of experience, which in my opinion is the key to success.

It is a misconception that in a complex market, having a simple system can make you profitable in the long term. It may work in the short term, but my intension has never been quick money, but a sustainable success from which to live. I have already published my 100 spices that I use a few times, but that will not help anyone. Even if someone makes a recipe, it will always taste a little different. The goal must be to create your own recipe and for that this blog was launched. You may find some spices here that you like, if not, just let it go.

On the stock exchange, the most diverse interests collide. For every trade you need buyers and sellers with different opinions and motives. It is completely impossible to determine why a special course is achieved by asking all participants about their motivations. The stock price must therefore by no means be "fair" or "explainable" in the sense of an analysis. The exchange rate is calculated by combining supply and demand. The broker sets the price so that the highest possible turnover is generated with the given orders. And that's exactly what makes the stock market unpredictable.

My basic understanding of the market is that only the big players influence the market significantly through their individual strategies. News, meetings and opinions are therefore of no relevance to me. 95% of retail traders lose and the big players are focused on this target group because they have it easiest there. Since you can always identify the big players only in the short term and then it is usually too late, you have to focus on the majority of retail traders. Once you have identified the retail traders you have to orient your strategy in the opposite direction and then look for a suitable entry situation.

In this summary you will find links to my contributions, which will give you more information. On health, psychology and fitness are the cornerstone of success in trading I will not go into detail today.

Since the price of the stock exchange, the combination of supply and demand, it was logical for me to focus on it many years ago. If the supply in the market is greater than the demand, the price drops. If the demand is higher than the supply, the price rises. When supply meets demand in the market, equilibrium is created. I have been working with this basic understanding for years.

Equilibrium a key to success.

As a trader who trades for Equilibrium, one dreams of a chart image that always indicates exactly the supply zones and demand zones. From this one could always deduce in which trend phase the course is currently. As such an indicator would have to look to the future, it quickly becomes clear that this wish will always remain a dream. Nevertheless, one can gain an advantage with the right tools in the large shark tank.

Determine trend strength in any period

The final countdown

The Bionic Chart recognizes at first glance that there are no shadows and that the open has been dispensed with. As a rule, one can do without this information as the close of the previous candle usually indicates the open of the new candle. The close is basically displayed in the Bionic Chart, so that the open of the new candles can be recognized quickly.

The bionic chart

Indicators for Project 2 Part 1 (bionic chart)

No matter which strategy or system you work with, it is crucial that you are profitable. In addition to an optimal Moneymanagement one should check his system regularly. There are a few vendors on the Internet who can help you analyze your numbers and facts. It is important to find out what is worthwhile. But you can also do it yourself and calculate it relatively easily. You can find an example here.

Easy increase in trading efficiency!


Sometimes I have already thought that the big players invented the indicators to take the money from the small trader. An indicator always remains in arrears, i. he derives his values from past price movements. How can you make the right decision with old information in a live trade? The indicator also does not take into account the situation in which the market is currently located, where traders' orders are hidden, where liquidity is located and whose balance leads to a reversal. However, I do not think the indicators are fundamentally bad. So-called auxiliary indicators facilitate my work and provide a better overview. In order to win in the long term on the stock market, I need a knowledge advantage over the other traders. In addition, I have to put myself in the position of big players and know how they think and act. Price Action Trading means understanding and applying market conditions.

Indicators- with 200 in the one-way street?

As already described in some articles, today's big players are working with strategies that bring big disadvantages for smaller traders. This refers to the so-called high frequency traders, which on some days account for up to 50% of the trading volume. They work with incredibly fast computers and programs. The speed of these programs is enormous. They can respond to price changes within milliseconds, bringing them to market faster and faster.

The tricks of high frequency traders

The hard unvarnished truth

Learning from high frequency dealers

When I started working with the Metatrader, the order opening for a Swingscalper was very cumbersome. It took some time until all the values were entered. A small relief was the 1-click trade in the Metatrader, but I was not satisfied. At some point, the brokers began offering small mini-terminals. The big problem: The stop could only be brought into the market after the order. As a long-term trader, this is even less tragic as for a swing scalper. A few years ago, I discovered the VR Steals, a retail panel that was still in its infancy at the time, but already significantly better than the Metatrader variant. In mid-2014 I became aware of the third version. That was a breakthrough for fast trading.

Orders quickly and effectively

Of course it would be optimal if all traders could see the same candles, but this is impossible due to the different brokers and the different course positions. This means that candle making is different for many traders. Here's the first clue that candle formations can not work in my eyes. Now imagine the presentation of different indicators that each trader has built into his chart.

The same time, different candles

There are many hurdles to overcome in finding the right broker. Not the cheapest broker is always the best. First of all, your investment behavior is a decisive criterion. As scalpers, spreads should be cheap and no additional costs should be incurred. As a long-term trader, spreads can be less critical. The right price-performance ratio determines the right broker. Here's an example of what to look for in a CFD broker.

How do I find the best broker for me?

For me the essential aspect was to find a highly frequented market. This is clearly the foreign exchange market. But within this currency market, there are many currency pairs. Here I would like to show you how I used to choose my optimal currency pair.

The most efficient currency pair

As we have already stated, the price movements in the forex market are due to pure coincidence. Markets are rarely determined by news, but usually by the strategies of big players. No one is able to predict the course of the price and to determine exactly. In a randomly generated market, you have a realistic chance of making the odds in your favor. But that's exactly what you need the right information for.

Who is faster the euro or the dollar?

The main reason why in the past there were only time-based diagrams is the lack of technology in the past. At that time, the exchange simply was not able to give market participants access to real-time data. With technological advances, when stock market trading took place around the clock, which was associated with greater volatility, traders experimented with a variety of charting methods. This created the first time independent chart images. Interesting are the supply and demand zones, which now consist of ticks. From our point of view, these zones are now formed even more precisely and in combination with the Bionic Chart even more reliable statements can be made.

Is a tickchart really beneficial?

Download and test a tick chart

If a trader is not satisfied with his results, it is often because he is following the wrong strategy. There are many strategies when trading, finding the right one is the challenge. Unfortunately there is no standardized solution in trading. If you read somewhere "This strategy always works" or "it's just that way", then you should be skeptical. A strategy consists of various parameters such as setup, trading style, time units, money and risk management, etc. Let's look at a few different setups first. I would like to limit myself today only to 5 essential setups.

How do I optimize my strategy?

Today's report is about the differences between the forex market and futures. The most important backgrounds are illuminated and some very interesting findings came out. Therefore, this report has become slightly longer than usual.

Forex versus future

Dark pools are bank or exchange trading platforms for the anonymous trading of financial products that are traded outside the open securities trading of the stock exchanges. The dark pools include areas such as Forex (Spot Currency Trading) and CFD (Contract for Difference). Dark pools are not subject to the rules and supervision of the European stock exchanges. There is no transparency in these markets. In the LIT market or light pool market, which refers to the ECN stock exchanges, there is an order book that will be published for everyone. This market allows traders to see the amount of liquidity.

Project 6 Forex & Future

In today's article, we want to deal with various information that we receive in the forex or futures market. This information is hugely important as we derive our trading decisions from it. So we have to be careful to get only information that is correct.

60% better trading in the forex market?

Two things we have discussed in detail in recent weeks, the Forex or stock market it is all about supply, demand and liquidity and we know that the Big Boys determine the markets. The Big Boys depend on liquidity to achieve their goals. I have written a few times before that it is crucial to put yourself in the position of a big player in order to be able to actually follow it. The big players do not think like a small investor. If we want to trade ten lots, we just hit the button and we're in the market. If we want to sell ten lots, we just hit the button and we're off the market. A professional trader trades not only with 10 lots but with some 1000 or in the forex market with 100,000 lots.

How to use the stock market cycles correctly

Prepare for next week

Example for Accumulation and Distribution

Over the last few months, I've been specifically looking into the similarities between the EURUSD on the Forex market and the Euro-FX on the futures market. We have found that the price movements in the different markets are almost identical, although there are, of course, different prices due to the swaps. Here are some important recommendations for an interesting Futurebrocker and an interesting trading platform.

Project 6 first interim conclusion

To illustrate the volume, comparisons are made on the internet with a car, but this comparison is not quite correct. In the last few days, I came up with the idea to present you this comparison with a watercraft, I believe that one is able to relatively quickly capture the benefits and the functioning of the volume.

How important is the volume?

Volume: Speed, Accelerator and Current

As we already know, there can be no concrete volume in the forex market, as it is an OTC market and not a stock market regulated market. In contrast, we have found that the price movements in the Forex market and in the future market are almost identical. This fact has brought me an interesting idea that could possibly bring our forex traders closer to the volume.

Important information about the forex volume

Amazing discovery in volume

My assumptions are based solely on supply, demand and equilibrium. These laws of the market apply in all forms of the economy and that will never change. With this variant of the market observation I manage to turn the probability in my favor. Another aspect must not be forgotten. The longer you are in the market, the more likely you are to lose money. As a scalper, I reduce this probability because sometimes I am only a short time on the market. Because the price movements in the forex market are purely coincidental, we can only increase our odds on the basis of probabilities. However, before we put together the different probabilities and assumptions about an interesting strategy, we still have to deal with a probability. This is about our hourly pay, or how much pip we can achieve in the different time units within a certain time. As always, the calculations made here are purely hypothetical and may differ significantly from reality.

Increase our hourly wage?





Summary:

In the forex market I rely exclusively on the time and price data in the tick chart. Volume data, number of trades, delta volume, and spoofing are key factors in the futures market. Similarly, the delta volume at the respective price levels within an equilibrium is a deciding factor. There I analyze the absorption of Bid and Ask in order to generate a market advantage. Although the forex market is harder to trade than the futures market, the opportunities for profit are much greater here. With the data from the futures market you reduce your trading risk in the forex market significantly.

I'm a second / minute scalper and I prefer to trade exclusively the EURUSD in the downtrend in a reversal setup or pullback setup. My stops vary between 0.5 and 1.5 pip, depending on the volatility. The take profit is based exclusively on the volume that I receive from the futures market and my zones which I determine in the 8 tickchart forex market. In addition, I analyze the spoofing in the DOM, ie the number of deleted or short added bid and ask. With that, I decide at short notice whether I will stay in the market to improve the opportunity risk ratio or to quit immediately. As a rule, I use short movements with a high number of contracts. As I get a new trend every 5 minutes in the 8-tick chart on average, many interesting trades are possible within one trading day. This enables me to achieve up to 1 Pip / min. A downtrend is 40% faster on average. Within a trend, the pullback phases are very interesting.



The price and time data are identical in the forex and futures market minus swaps. In fundamental analysis, the currency strength of the euro and dollar helps me in different time units. In the technical analysis, I use the volume from the futures market and analyze the accumulation and distribution in the forex tick chart. For the short-term charting technique I use an 8-tick chart with the Bioniccandle and the Bionic ZigZag indicator which shows me the average candle size in each trend.

The volume from the futures market can be seen in a 3-tick chart in the form of bid and ask. In addition, I analyze how many bid and ask the big players buy at certain price levels. Within an accumulation phase I recognize in an outbreak down in the 8 Tickchart Forex whether the stops of the Trader are triggered. It's always a good and quick start for a breakout.

In the forex market I use the broker Aktivtrades, AMP in the futures market and as trading platform ATAS. With ATAS, I focus heavily on absorption, the horizontal and vertical delta volumes. The settings are flexible and almost unlimited.

My 8 screens have the total area of an 85-inch screen and contain different fundamentals and technical analysis information as well as charting within the forex and futures markets. Sometimes the currency strength helps me, sometimes the absorption, sometimes I need the spoofing or the vertical or horizontal delta volume. Interesting zones can also be found in the horizontal price zones where the course was the longest. My main screen is a kind of hybrid, consisting of forex and futures data. The goal: Identification of big players or retail traders. When I have identified a big player I try to follow it, when I have identified the retail traders, I try to act in the opposite direction.



Of course less is sometimes more, but since I do not know yet, which data give me the optimal information, I still see it as a personal project. Concentration on the essentials will only be possible when the experience within the different information has been completed. As I've already been told by some successful high-frequency traders, it is highly unlikely that you can be profitable in a complex market with a simple system. As markets change permanently, you have to be willing to do it also. And that requires permanent learning. Compared to the forex data, the futures data are much more detailed but also much more complicated when dealing with spoofing and absorption. But it is a new challenge for our future project 7.

I ask you again to see this information as a buffet, take out what's fine, just leave the rest. Nevertheless, I hope that there was something that brings you further.

I wish you a very successful trading week

best regards

[quote=Js3mwtRc;12503536]{quote} Hi Bionics, I admire the work you are doing here in this thread,

Hello Js3mwtRc,

First of all, very much thanks for your encouragement for this blog. The tab Trades at FF is known to me, but the information for me are not representative enough to derive a mood from it.

Attached Image (click to enlarge)

In the analysis of FF, there were 262 Trader long and 261 Trader short 1 hour ago. Information about fxssi would be more meaningful, because more data is analyzed.

According to the press and stock market information, more than 1 million traders trade daily in the EURUSD. The listed traders in FF show just 0.05% of the total market. Although we do not know in which time the 1 million traders are in the market. In addition, one would have to differentiate between Scalper, Daytrader and Swingrader. For a trend assessment, I would prefer the data of the day traders and swing traders, rather than the data of Scalpers.

In my last post, The best chance to win, I have listed several examples of how I try to assess the market. The basic analysis always consists of supply, demand and equilibrium or also accumulation and distribution. For me, the crucial phase is the sideways market or, in the definition, a larger equilibrium. In this sideways market, the big players buy ask or bid so they can then push the course in the desired direction. While a big player could press the buy or sell button at any time to move the price in a particular direction, it would be suicidal because it would come into the market at a poor average price. That's why he collects a certain amount of bid or ask in the sideways markets. Then the price is pushed up or down. In the forex market you can not detect this collection of bid and ask, because simply no data is provided. In my last post, I described some strategies that are a little bit elaborate. If you've been thinking about it long enough, the result will speak a clear language. You are absolutely right that it is crucial to identify the big players or the retail traders. In my opinion, optimal identification works only with the right stock market data from the futures market. Of course, in the last few years, I also used the Forex data to sell my trades in the market and had more luck than good judgment. The probability of winning is significantly greater with the stock market data.

Best regards

Thanks for making clear the difference between the future market and forex spot, I only use forex, but your post is detailed and I think I can make it at least not lose using sentiment from the sources I found here in this thread, but I should stick well with a right risk management.

Hi friend.
Thank you so much for answering me, and thank you even more for your referral, I'm sure there.

A lot of success for you.

New project No. 7


Hello dear subscribers,


With the summary of the different probabilities The best chance to win I would like to conclude our project number six. In this # 6 project, we saw how important the future market are to trading profitably in the forex market.

Our new project number seven will focus on how to use the stock market data to be even more profitable in the Forex market. Of course, there are some costs, but as a trader you are an entrepreneur and an entrepreneur always invests in his own company. The monthly cost of the stock market data and the trading platform is around $ 100. These costs are quickly back in with one profitable trade. We should note that a futures trader is three times more likely to win than a forex trader. I have described the reasons for this in detail. In principle, the stock market data can be compared with a navigation system and the forex data with a road map. In the navigation system I get a lot more information about weather, traffic jams, construction sites and much more and I'm able to reach my destination faster. It is clear that a navigation system is significantly more expensive than a road map. Anyone who lives off action should therefore think about the information he uses to risk his money. Let's take a look at how the stock market data can help us in our daily business.




The price of EURUSD is always in balance or imbalance phases. Balance means the market is running sideways and imbalance means that the market is in a trend phase. In the H1 chart of the EURUSD H1 I marked the balance phases. In about 70-90% of cases, a market is within the balance phases. Of course, all traders try to take the strong breakout and trend phases, but the likelihood of achieving that is very low.



Let's look at an example from a typical week in EURUSD. Within this week, there are five clear balance phases and three imbalance phases. It is very well known that it is ineffective to limit oneself to the trend phases. Therefore, as a trader, one should focus on the balance rather than the imbalance phases.



With the market profile, the range trading is greatly simplified, because there are certain zones in which you can trade. Let's first look at the blue-bordered zone.



In addition to the volume high and volume low zone, there is a POC zone. The POC is the zone where most volume occurred within a given period of time. Above this zone you should only look for long trades and below that zone only for short trades. However, the best entry is above the volume high and below the volume low zone. In this example, we see very well how the POC works as resistance or support. If you invest a volume profile after completing a course, the POC will always show distinctive resistance zones. Of course, within a course, the Volume High and Volume Low Zone will change regularly. I once shot a video about these zones to show them that the POC changes only slightly in this case. This is because there are certain price zones in which the volume is significantly higher than in other price zones.



It is very interesting to see that after the first strong break down the POC zone was not changed anymore. In this case you could have done some interesting trades with it. Maybe this could be a motivation to get more involved with the market profile. There are many things to keep in mind that I will not go into in detail now. The market profile works best with the right stock market data.



Let's look at another and interesting example of delta volume and absorption. In an overview in the EURUSD Forex market, we see from 10 to 18 September an interesting price trend. Initially, the price was in an uptrend, there was a sharp decline and within the same day, the losses were offset. At points A and B I have marked two resistance zones. The course was initially down and it formed at point C, an Equilibrium. After the sharp decline, it would have been possible to assume that the price is still going down. After the stop hunting at Point D, this range was a typical accumulation for me. The price initially went up and stopped within my resistance zone at point E. This was unusual for me at first, because in an accumulation phase, the big players collect first the Ask, to push up the price sharply. The fact that the course came to a halt could have only two reasons. The resistance zone at point B was so strong that the course could not get through or the big player could not collect enough Ask in the accumulation phase to push the course further up. That's why I took a closer look at the point E in the stock market in order to make a decision for the future course price.



In the forex market EURUSD M5 Could not see much in this crucial phase. Therefore, I would like to show you once what it looked like in the stock market.



In the Euro FX, it could be seen that in this phase an above-average negative delta took place. A delta arises from the sum of Bid and Ask. If the Ask is larger than the Bid, a green delta candle is created and if the Bid is bigger than the Ask a red delta candle is created. This high negative volume of deltas was created exactly at 09:00 CET with the opening of the London Stock Exchange.

To get more information, I've used a footprint chart to help look closer into the candle. Basically, I'd like to say that while a footprint chart is a cool invention for getting more information, the information is far from reliable. As you know, with a footprint chart you can see the imbalance in the market. An imbalance arises when between Bid and Ask a clear difference of, for example, 300% can be seen. This imbalance is always calculated in a candle from bottom left to top right. For example, if you notice a strong imbalance in a M 15 candle, it may be due that in a M 5 candle this imbalance no longer exists. This is simply because the price within a candle often goes back and forth a few times, watering down the imbalance. This makes it difficult to detect absorption with a footprint chart.



Let's take a look at this striking zone with the opening in London at 9:00. In the 512 Tick Chart we can see that within four candles, a volume of 3769 bits and a volume of 1373 ask was traded. Of the total volume, just under 75% was traded on the bid and 25% on the ask. Nevertheless, the price has not gone down much. It was simply because there was a big player underneath that bought the whole bid.



In the smaller footprint chart you could see that the strong sales orders have come into the market that have not moved the market down sharply, but effectively I could only see that in the DOM. Big players have a habit of disguising their absorption. They buy very quickly in succession with smaller quantities at certain price levels, the bid or Ask on. In the DOM one is able to recognize the purchased quantities.



If a large number of sales orders arrive in the time & sales list, you can see in the DOM how the number of sales orders are counted up and wonder why the price does not fall. We know that a big player would never simply press the buy or sell button to push the price up or down. That means he has to collect Bid or Ask first. In the example shown, the question was: Why does a big player buy 3769 Bid? The answer: Because he assumes that the price will rise in the future. Thereafter, the price has risen by 60 pip. At some point a big player has to get off again and sell his 3769 Ask. What will happen after that? The course will fall. And that's exactly how it was. We recognize that a footprint chart is not the holy grail, but in combination with the time & sales list, the DOM levels, the volume delta and the market profile, you are already a step ahead. That's one of the reasons why the stock market data gives more information than a pure chart from the forex market. When we work with probabilities, correct data is an absolute must. In order to be profitable with a high probability in the forex market I can not do without stock market data.

I hope this little example can help to increase your future profitability. I wish you a nice weekend and next week a successful trading week.

best regards

thank you your hard work excellent....very interesting poc project
mt4 markert profile indicator free all view not well

[quote=thisara1;12519264]{quote} thank you your hard work excellent....very interesting poc project

Hello thisara,

First of all very much thanks for the friendly compliment for our blog. In fact, this is a very elaborate job of comparing the forex and futures markets. Nevertheless, the results are promising and I am confident that we will make further progress in the coming months. In recent years, the majority of Forex traders have lost a lot of money in the markets, as there has been a significant imbalance in the price data between the big players and the retail traders. Many brokers have made a lot of money in recent years with this circumstance. After the regulation of ESMA, 95% of traders in Europe were left to work with a leverage of 1:30. This caused a broker change to Australia or Cyprus and some traders also switched to the futures market. All of a sudden, the first brokers in Germany are offering additional futures data in order not to lose their customers. One inevitably wonders why the brokers have not offered that before. But it is well known that a cow is not cared for until it gives less milk. In Europe, the brokers have massive problems, as the majority of traders lose money and eventually get off. However, this does not apply to all brokers, it took me a long time to find a good broker that is absolutely fair and at the same time offers good prices. Now that many traders have jumped off, the first brokers have begun to support their clients so that they are able to make more profits. I am convinced that in the future we will still get significantly lower prices, which makes trading even more attractive.

Let's get to the challenge of the market profile in the forex market. The market profile is calculated from the volume that is unfortunately incomplete in the forex market because no market participant can provide the actual volume of data.



In the comparison that follows, I compared the volume of the EURUSD from the forex market with the euro FX from the futures market. Here the last four trading days were calculated. As I said in my post: Amazing discovery in volume there are significant differences that make it significantly more difficult to operate profitably. At first glance, the volume seems similar, but the crucial zones automatically cause a misinterpretation and thus a loss. In my post 1029 and 1030, I have shown an interesting alternative on how to more accurately represent the volume in the forex market. The only way is to calculate the volume from the pricing in a tick chart. Unfortunately, there is not such a volume indicator yet. The only alternative is the real stock market data from the futures market. That was also the reason for our new project number 7. The goal is still to trade in the forex market, because you can make the highest profits there and the volatility is significantly higher than in the futures market. However, as the forex market does not provide the correct volume or the number of trades, the futures data is an indispensable tool for long-term profitable trading in the forex market.

The happiness of life is not to have little or no difficulty, but to overcome these difficulties. It should be noted that one can never solve problems with the same way of thinking that created them.

best wishes

Bionics, now if we can combine volume data from top 10 brokers by trading volume and then average it out and produce a volume profile - this will be a whole new world.