The Equilibrium, a key to success!

Forex Factory, How Do I Find Like Minded Traders Near Me?

Hello dear subscribers,

due to unnecessary discussions, I would like to post my new video again. You can find the English translation here:

https://www.forexfactory.com/thread/...2#post13519172



I am currently preparing an interesting project for you. In the future, you too can work with different tones in MT4. By the end of the next week, the indicators and various tones will be ready. I will also produce a video about it.

I wish you a great weekend

Greetings Michael

Wow. Looking forward to seeing this!

MT4 tones and sounds with different tone sequences and indicators



Hello dear subscribers,

the new video is online and, as always, you will first receive the English translation. You can find the link from the video and the indicators at the end of my post.

In today's post you will get two important pieces of information. First, what is more important, fundamental analysis, technical analysis, charting or reading out algorithms? Second, I am going to show you a specific way how you can use the MT4 to generate sounds in the Forex market and to take advantage of them. Of course you will receive an indicator and the tones I have modified to download.

Let us first come to the four big question marks in retail. As we know, we always work on the principle of probability to make a profit. How can we proportionally increase our probability of winning? Is it the fundamental analysis, the technical analysis, the chart technique or the algorithm analysis? The correct answer is both. In principle, I work with all four strategies, but I use them in different ways. I extract the fundamental analysis with data from the Forex market. For me, the technical analysis data can only be determined in the futures market. An optimal chart technique is only possible in the forex market, and the algorithm analysis can only be realized with stock market data.

In fundamental analysis, the question arises what am I buying? Since I only work in EURUSD, only the euro or dollar comes into question. The solution, a currency strength indicator that reacts faster than average. Due to the higher volatility, only the forex market is suitable for this, especially since there is no currency strength in the futures market. The reason for this is relatively simple. The strength of the dollar is determined by running the dollar against the seven major currencies. The strength of the euro is determined by running the euro against the seven major currencies. A corresponding distribution ratio must be formed from this, from which the respective strength is determined. Curiously, no one in the future market has come up with the idea so far, possibly also because the effort involved with virtual data would be far too high.

In technical analysis, the question arises why am I buying? First and foremost, it is about determining the phases of accumulation or distribution. These big players' collection campaigns take place 85% of the time and give a prospect of long-term price development. However, the calculation is not that easy. Therefore, identification is only possible in the stock market. As I have already shown in some videos, the limit orders must be specially filtered for this. This makes it possible to find out which market orders are actually accepted by the limit orders. The complete display of all limit orders does not show us the reality. In the upper image of the limit orders, one could assume that the big players collect massive ask to push the price further up. In fact, however, they have collected bids at this point, as you can see very nicely on the price that then descends. Only those who are able to correctly filter out the decisive limit orders can increase their probability of winning.

When it comes to chart technology, the question arises where do I buy? Using my self-developed bionic candle, I determine individual key candles in the M1 or M5, which show me the exact reversal points. Due to the five times higher movements in the price, only the forex market is suitable for this. You can find specific information about the Bionic candle and how it works in these two videos. Every trader tries to find the exact turning point in the chart, most of them fail. I felt the same way many years ago, for this reason I developed a candle where you can still see exactly which movements were the strongest afterwards. The exact key candles that show the future turning points can be determined precisely from this. Here you can see a strong M1 key candle that was 10 pips in size. This resulted in a future reversal zone. Since I only work with a stop of 1.5 pip, this zone would have been much too big for me. With the help of special tick charts in the Forex market, I am able to determine the strongest zone. In this case, I was able to reduce the key candle to two pips and thus determine the future reversal point much more precisely.

My charts in the futures market, which at first glance seem very complicated, are primarily used for algorithm analysis and the question of when do I buy and when do I get out? To do this, you have to go as deep as possible into the market to get the fastest information. I would like to explain this to you in more detail. Basically, the market only moves because the volume is flowing into liquidity. First I created a table in which there are three different strengths. Strong, Medium and Weak. I have now examined these three states of aggregation in all their variants. First of all in the area of buy market orders, then in the area of sell market orders. This resulted in three conditions that are possible in the market. The bullish move, the equilibrium and the bearish move. Ultimately, these movements result from the respective strength of the different order types. As we know, the market only moves because the market sell orders run into the limit buy orders and the brand buy orders run into the limit sell orders. Now let's imagine that the market sell orders have a strength of 80% and the limit buy orders have a strength of 50%. First of all, let's leave out the iceberg orders. In this case, the market sell orders would penetrate the limit buy orders. On the ask side, the market buy orders have a strength of 20% and the limit sell orders a strength of 60%. What will happen? The market buy orders are absorbed by the limit sell orders and the price is intercepted. Now let's add the whole thing up. The market sell orders and the limit sell orders reach a strength of 140%, while the limit buy orders and the brand buy orders reach a strength of 70%. It is clear from this that the course must be going down at this point. And that is exactly the whole secret. With special filter settings and the consideration of the iceberg orders, which can be read out using the spoofing information, only the individual strength of the individual order types has to be determined. Higher probabilities can then be derived from this.

In my video: How to react 20 times faster in trading, I have already gone into more detail about the tones I have developed. This is another key element to be more successful in the market. Our eyes have a reaction time of 30-40 ms, our skin reacts in 10-20 ms, our ears to sounds coming from loudspeakers in 3-5 ms and sounds from the headphones are perceived in around 2 ms. Our eyes are thus able to perceive 25 pieces of information per second. With our skin we can record 100 pieces of information, our ears 250 pieces of information and headphones up to 500 pieces of information per second. It is questionable whether the human brain can actually process 500 pieces of information per second, but they are available and can significantly increase the probability of winning.

With the precise analysis of the different information from the DoM and the time and sales list, one can find out interesting things with a creative approach. The executed limit orders show me the long-term market movement and with the executed market orders I am able to record the short-term market movement. The limit orders that have not yet been executed in the DoM give me a glimpse into the future. Here is a future willingness to trade, but one should be viewed with great caution. It is not for nothing that it is said that the Times and Sales List speaks the absolute truth, while the DoM produces one lie after another. And let's take a closer look at that. Since the Times and Sales list shows all market orders that have been executed, the statement that it is speaking the absolute truth is correct. In the DoM, the current price, the executed market orders as well as the best bid and best ask price are also the absolute truth. The lie lies in the limit orders as they can be added or subtracted at any time. This is also followed by the native or synthetic iceberg orders that we cannot see. On the other hand, the current spoofing information is true again. To what extent the iceberg orders increase or reduce our trading opportunities, we will take a closer look over the next few months.

First of all, we ask ourselves the question, how can we extract tones from price movements? To do this, we must first understand how a movement in the stock market arises in the first place. Let's take a closer look at this. Here we see the market buy orders, the limit sell orders, the market sell orders and the limit buy orders. The price line is on the best ask page. Now a 5 lot market buy order comes in, which reduces the limit sell order by 5 lots. Next comes a 5 lot market sell order. The price jumps from the best ask side to the best bid side and the limit buy order is reduced by 5 lots. Now a 10 lot market sell order comes in, the price remains on the best bid side and the limit buy order is reduced by 10 lots. Here we see a 10 lot market buy order, the price jumps to the best ask page and reduces the limit sell order by 10 lots. Now another 15 lot market buy order comes into the market, which runs into the limit sell order. This is where things get interesting as a 15 Lot Market Sell Order hits the market. All limit buy orders are eaten up and the price jumps a tick down. This now creates a small gap because the best ask and best bid are no longer linked. The gap only closes at the moment when another limit sell level is created. If a buyer were to buy into the gap, he would now have to pay double the spread. We see that a higher spread is not the fault of the broker, but is only due to a missing limit order. In this context, it was only important to understand how a movement in the market arises.

In the future market we can extract different tones. Bid, ask or the total volume, we can also create tones from the best bid, best ask. That is also my preferred approach. In the forex market, the creation of tones is limited to the ticks, as there is no specific volume. The volume in the forex market is specified differently by the respective brokers. If we compare this volume with the real stock market data, we see that there are clear differences. A few years ago I tried to create a forex volume from the price and we can see that it is much closer to the actual volume than the volume we received from our broker. Here you can download the indicator for free on my blog at Forex Factory.

https://www.forexfactory.com/thread/...2#post12451112

If we now extract tones from ask or bid in the future market, it would look like this. First of all, we could produce five tones. Then another five, then ten, and so on. We will now take a look at an example from the future market, where I created the tones in this case from best bid and best ask. We see and hear how the price goes down.

Due to the lack of volume, there are of course fewer tones in the forex market. The start begins without sound. The price increases by a tick, so there is a tone. While 10 tones are produced in the future market, the price remains in the forex market and no further tone is produced.
The price jumps up a tad, which creates another tone and so on. We will now look at an example from the Forex market, in which case I created the tones from the ticks. We see and hear the price going down.

Now let's take a look at how we arrange the tones from the stock market as an example. A price rises sharply, in order to participate an investor has to invest money. He buys the stock because he is hoping for a rising price. He makes this decision rationally. The price is actually up and its stock is doing well. Suddenly the direction changes and his stock goes down. His profit is getting smaller and smaller. He decides to pull out his money to keep his winnings. He makes this decision emotionally. The ask tones belong to the rational decision and the bid tones to the emotional decision. When we split up the Ask or Bid tones, we automatically ask ourselves which speaker channel we should assign these individual tones to? Information from brain research and body language help us here.
Our left brain is responsible for language, reading and arithmetic, logic, science, the perception of time and linearity. This is our rational brain. Our right brain hemisphere is responsible for the imagery, the feeling, our creativity, play, overview, holistic connections and the sense of space. This is our emotional brain. Because of a crossing of nerves, the assignment of the brain and half of the body is opposite. This means our left brain controls our right half of the body, i.e. our rational, right side of the body. Our right brain controls our left half of the body, i.e. our emotional, left side of the body. Our left half of the body is our emotional side while the right half of the body is the rational side.

The question now arises as to how our brain picks up a sound that is perceived by the left side. Sounds that reach the left ear reach the right hemisphere. The right half of the brain reaches our left side of the body, so the sounds from the left also arrive on our left side of the body. Sounds that reach the right ear reach the left hemisphere. The left half of the brain reaches our right side of the body, so the sounds from the right also arrive on our right side of the body. By the way, a very interesting side effect when you ask a person after a cigarette, his cell phone or for money, in which ear you should speak so that he is more likely to comply with the request. Incidentally, there have been many attempts at this, and the result is very interesting. One should speak into the right ear, since the tones run into the rational brain. The request is processed value-free and the chance is significantly higher. Since our emotional half of the body is on the left side and is also reached through the left ear, I arranged the bid tones exactly there. The ask tones therefore also run into the right speaker channel. By the way, as you can see in my previous videos, all of my charts are geared towards this.

Interestingly, a sound tick indicator has existed at Forex Factory since 2006. The basic idea is absolutely great, but I have a small suggestion for improvement that I will explain in more detail in a moment. There are different tone sequences for this, which I modified and adapted in detail. A total of five different tone sequences are available.

Market Pace1 the more ticks, the higher or darker the tone becomes

Market Pace2 two different tones A and B for all ticks

Market Pace3 the more ticks, the louder the sound

Market Pace4 tones are exactly the opposite of Market Pace1

Market Pace5 two different tones C & D for all ticks.

You can download the indicator and the different tones on my blog at Forex Factory. What you have to do can be found in my penultimate video: Forex Factory, "How Do I Find Like Minded Traders Near Me?" You can also find a link in my video description. First of all, the indicator goes into the MT4 folder where all indicators are contained. The tones must be in the Sound folder. This is located on the local data carrier. For this you have to go to Windows, under Programs x86. There you may find different saved files from your MT4 if you work with several MT4s. Now all you have to do is identify the right one. In my case this is MetaTrader number three, in the Sound folder you put the 5 sound files I created. The folder Market Pace without a name is required by the indicator and contains the same data as the folder Market Pace 1. If you want to try a different tone sequence, add the letter A to the first folder and simply delete the number in the second folder one. Then the tones are extracted from it. Once you've installed the indicator, it should sound something like this.

Let's come to my suggestion for improvement. Unfortunately, I don't work with the tones in the Forex market, otherwise I would have taken the time to modify the indicator myself. As you know, the indicator reacts to every tick. In my DoM declaration you saw earlier that the price often fluctuates between best ask and best bid until it finally breaks through a limit level. This limit level is then broken down when the price is two ticks from the best ask price or two ticks from the best bid price. So I would modify the indicator. A tick is counted as soon as the downward price is two ticks away from the best ask price. A tick is counted as soon as the upward price is two ticks away from the best bid price, which could provide more detailed information.

The tone indicator is particularly suitable for market participants who work in higher time units. Please note, however, that the tones are the same in all time units. A tick is always the result of bid and ask that run into limit sell or limit buy orders. A big advantage is that you can hear the movements in the market. Of course, you can also see them based on the price line. This has the advantage that you don't always have to look at the screen and you can always hear the movements in the background. Every trader has to try out for himself whether this will result in concrete advantages for future trading.

The tones I have made available are an introduction to working with tones in the MT4. Basically, I recommend working with tones from the stock market in the long term, as they are much more versatile. The tone frequency is also significantly higher and you can hear the strength of the limit orders through the tones. This results in far more opportunities in the long term to increase the probability of winning. I would be very happy if the information would help you. I hope you enjoy it and I keep my fingers crossed for the future.



I would be very happy if the information would help you. I hope you enjoy it and I keep my fingers crossed for the future.

Kind regards Michael

Downward movements are 30% faster than upward movements


Hello dear subscribers,


the new video is online and, as always, you will first receive the English translation. You can find the link from the video at the end of my post.

In the last 11 years I have compiled important theses for my trading success from different probability calculations. You can see a selection of them running up the screen.

 

1. There are no typical trends, just movements that result from the current market situation.
2. Downward movements are on average 30% faster than upward movements.
3. Acoustic signals can be perceived 20 times faster than optical signals
4. My deciding factor is the pips per minute.
5. Volume trading is ineffective in both forex and futures markets
6. Currency strengths are a crucial factor in the forex market.
7. The fastest information is obtained from time- and volume-independent charts.
8. If you want to be successful in this market, you need the right technical equipment.
9. Every trader should determine his optimal currency pair in order to achieve the highest probability of winning.
10. Money management is an important fine-tuning to optimize profits, it is more crucial to get in and out at the right time.
11. News and price are completely irrelevant to profits.
12. An indicator in Forex primarily only translates the price with a different representation, but has the disadvantage of being lagging.
13. The shorter the time spent in the market, the lower the risk of smaller breakouts being stopped out.
14. There are no patterns in the price, the candles or the representation of indicators.
15. The market makes the news and not the other way around.
16. In 30% of the time there is movement, 70% of the time the market is in an equilibrium.
17. Forex and stock market data must be combined in order to achieve the highest probability of winning.
18. Success in trading depends on the effective screen time.
19. It is easier to concentrate on the 12 biggest big players than on 1 million retail traders.
20. Due to the different algorithms, market technology is now out of date.
21. Smaller iceberg orders dominate the markets today.
22. Bid and Ask do not decide about the future of the price, only the limit orders.
23. There are 2 different bulls and bears fighting each other in the market.
24. Candles do not give any information about the future course of the price.
25. The big players always work with a similar approach.

These theses have made many things easier for me in trading and possibly brought me the success I have always wanted. In the next few months we will pick out a few theses and analyze them in more detail. At this point I do not want to claim that my view of the markets is correct and that the way I trade improves your probability of winning. Every trader has their own opinion which I absolutely accept as everyone manages their own risk. However, we should help each other and there may be some information today that will help you in the market. If so, I would be very happy about it.

Today we will deal with the first thesis. Downward movements in EURUSD are on average 30% faster than upward movements. Now let's see to what extent this is true. In 2019 I analyzed upward and downward movements in the EURUSD on my blog at Forex Factory, with the help of my Bionic candle. I found that the average downward movements are between 29 and 39% faster than the upward movements. Since the price history of the EURUSD is already over 50 years old, I have now carried out an analysis that is 4 times more precise. The first basis was a monthly chart, where 126 different movements were examined. The advantage of a monthly chart is that it shows the movements more precisely than an M1 chart. The analysis determines the average pip values per candle. In the first and second charts we can see that the bearish movements are much stronger. The result of the analysis: the bearish movements were 32% faster than the bullish movements. This confirms my thesis, which I put forward two years ago.

We see a course in the M1 from May 12th, 2021. The blue arrow shows a number of 21.3, which is indicated by my zigzag indicator. What does this number mean? From the green line to the red line, the price has reached a distance of 6.39 pips. We now divide this pip by the number of three candles that were created in this route. That is exactly 21.3 pipettes or 2.13 pip. On average, each candle has reached a size of 2.13 pips. Since this is a 1 minute chart, a higher pip value automatically means a faster movement. For this reason I developed the Bionic Zigzag Oscillator a few years ago, which immediately shows me the decisive strengths in the overview. Here we see the three biggest strengths in the chart. Coincidentally, they are bearish movements. Now let's take a look at the last 50 years in the monthly chart with this auxiliary indicator. The strongest moves have definitely taken place in the bearish area. The bearish movements also dominate in the daily chart, although there are of course stronger movements in the bullish area from time to time. The bearish dominance can be clearly seen in the H4, as well as in the hourly chart.

First of all, we need to ask ourselves: why are the downward movements faster than the upward movements? There are two theories about this. As I have already shown in some of my posts, a price increase in the stock market arises from investing money. This investment is usually accompanied by rational decisions. When a price falls it means that money is being pulled out of the market. You want to secure your money or limit your losses. This often creates a chain reaction that is triggered by emotional behavior. It is easier to get your money out of the market than it is to invest it in the market. This means that emotional decisions often have a more dramatic effect than rational decisions. It is also known that pullbacks often have a stronger effect than the actual main movement. If we look at the course of the EURUSD over the past 50 years, we see that it is more of an upward movement. Within this upward movement, there are always quick pullbacks to stop the long traders. These could be some of the reasons why the EURUSD is moving faster.

Let us now come to the crucial point: What advantages can we derive from this information? A few years ago I took the trouble to analyze 96 of my trades in more detail. First, let's look at my 56 long trades. 68% win ratio, 32% loss ratio, 9.34 pips average profit and 7.26 pips average loss. The pay-off ratio, or rather the efficiency, was 1.29 and the expected value was 4.0. 40 trades were completed in the sell area. 80% win ratio, 20% loss ratio, 11.5 pips average profit and 7.8 pips average loss. The loss was thus even higher than with the long trades. The pay-off ratio was 1.46 and the expected value rose to 7.65. Then I merged the values for the long and short trades. 73% profit rate, 27% loss rate, the pay-off ratio was 1.39 and the expected value was 5.5. If I had now completed the 96 trades exclusively in the short area, I would have achieved significantly better results. In this case it would have been 207 pips more and the expected value would have improved by 38%.

Another point that may speak in favor of short trades is the security aspect. On January 15, 2015, the franc shock caused a downward movement of 2200 pips within a few seconds. Three years later there were extreme downward movements in some currency pairs. Interestingly, there has never been such an upward move before. Now let's analyze my 96 trades carefully. It took me an average of 4 minutes for the 56 long trades and was 224 minutes in the market. The short trades lasted an average of 2 minutes, so I was in the market for a total of 304 minutes. 96 short trades would have taken a total of 192 minutes, so I would have had to expose my money 112 minutes less to risk. That's a 37% advantage. Long and short trades combined produced a net result of 530 pips. That's a value of 1.74 pips per minute. With 96 short trades, I could have increased the pip value by 100% per minute. And that is exactly the crucial point for me. For my long and short trades I paid a 74.4 pip spread. The short trades would have cost me only 57.6 pip. That would have been an advantage of 22% in this case. In recent years I have often found that I often had to pay more spread for long trades than for schort trades.
Basically, I can recommend every trader to deal more with money management in order to find out which strategy is the best. This allows you to significantly optimize your probability of winning and you get regular feedback. That is the only truth that matters. My thesis: Downward movements in the EURUSD are on average 30% faster than upward movements, I would like to correct first. That this fact was so in the past does not have to mean that it will also be so in the future. The markets change regularly, so there can of course also be changes in this area.

Conclusion:

Whether my thesis will also be correct in this form in the future is questionable, especially since this analysis took place exclusively in EURUSD. You should analyze other assets yourself. However, it is much more important that you deal more closely with your money management in the future. This will help you find out which currency pair is best for you, whether you can handle short or long trades better and whether your strategy is still up-to-date. These numbers, data and facts may be boring, but they're like a trainer telling you the truth, unvarnished, every day. If you also pay attention to the pip value per minute, you can optimize your probability of winning significantly. But we'll talk about that another time. You can find the indicators on my blog at Forex Factory. I wish you every success with your future trading and would be happy if my information helps you.

Kind regards Michael

[quote=Bionics;13535953]Downward movements are 30% faster than upward movements .....................................However, it is much more important that you deal more closely with your money management in the future. This will help you find out which currency pair is best for you, whether you can handle short or long trades better and whether your strategy is still up-to-date. These numbers, data and facts may be boring, but they're like a trainer telling you the truth, unvarnished, every day. If you also pay attention to the pip value per minute, you can optimize your probability of winning significantly.

Hello Michael

Thanks wholeheartedly for another stellar post and video.

You highlight many important aspects but from the last post/video I personally think the above is some the most important aspects to keep in mind.

Thanks for providing us again with another view of the "different aspects" of trading!

Trade well / Mos

[quote=mosiskv;13536166]
Hello Mos,

Thank you for the kind comment, I absolutely agree with you. For most traders and beginners, breaking even should be the first priority. Those who achieve this goal are among the top 10% of all traders. As I wrote in my last post, the information that downward movements are 30% faster could lead to a significant improvement in trading if the points you mentioned are also observed. I wish you a successful trading day.

Kind regards Michael

News and price are irrelevant to my trading


Hello dear subscribers,


the new video is online and, as always, you will first receive the English translation. You can find the link from the video at the end of my post.

As I already showed in my last video, there are different theses that I have created over the past 11 years to make it easier for me to act. Today we are going to talk about my second thesis on the subject: news and price are completely irrelevant to me. To say it right from the start, of course there are professional traders who value news and the price and thus also trade successfully. In this video we will take a closer look at why I do without it. You could possibly save a lot of time with these ideas in the long term and thus act even more efficiently in the future.

In the table we see that institutional traders as well as retail traders in the futures market place great value on volume and price. This does not seem to be the case with the big players. Let's take a closer look at why this is so. In many of my posts, we have already talked about the different strategies of the big players. 85% of these strategies take place through accumulation or distribution. During a sideways phase, Ask is collected and the price is pushed up. You either get out of your position afterwards, or there is a re-accumulation phase where further ask is collected. Now the price is pushed up and they get out of their positions. A distribution phase arises where the big players collect bids and the price is still running down. In the re-distribution phase, another bid is collected, the price is pushed down and then you get out of your positions, and the whole game starts all over again.

To collect this ask or bid, limit orders in the form of smaller iceberg orders are used. The big players are therefore dependent on the volume of retail traders, which is primarily absorbed by triggered stops. Although the big players control the market very well, it should be clear to everyone that no big player can precisely plan this recorded volume of stops in advance, as it always depends on the reaction of the retail trader. For this reason, the price levels do not play the major role here. Since I also follow the big players, the price is irrelevant to me. At the end of 2016, Deutsche Bank and many currency experts estimated that EURUSD would hit 0.95 by the end of 2017. Despite the assessment of these experts, it turned out completely different, meanwhile the price is back at 1.20. The highest price in EURUSD was 1.6038, and the lowest was 0.5365. This results in a theoretical mean of 1.0697, which is, however, factually incorrect, as the main volume took place significantly higher up. Theoretically, the price can also drop to 0.4 or rise to 2.0, so there is no top or bottom in the price. When the price rises the euro is stronger, when the price falls the dollar is stronger.

As I have already shown in my previous posts, there are no clear patterns within the price from which one could achieve concrete trading advantages. I don't care whether the EURUSD reaches parity or rises back to 1.60. When my friends ask me where the EURUSD currently stands after a trading day, sometimes I cannot tell them. Many traders often assume that round price levels are responsible for a trend reversal. In fact, there are still many institutional traders who hold on to round price levels, but they do not have the capital to significantly move the EURUSD. Here we see examples of round price levels in the EURUSD weekly chart. The fewest turning points take place in round price levels. In the current Euro FX contract, I took the trouble to sort the volume by price. Let's now see whether the main volume between 1.21 and 1.17 is actually always at round price levels. We are now looking at the largest volume mountains and see that these are not round price levels. Even the largest volume in this period did not take place at a round price level. Of course there are also price levels like 1.19 where this works, but there are more price levels where it doesn't work. In my opinion, making a trading decision from this would not be effective.

This is exactly why I developed the Bionic candle, it shows me the strongest movements in the chart. From this I can develop my key candles that show me the exact turning points. You can find more information about this in my videos. It is not the news but the market participants that influence the market. Why is that? Because we never know how market participants will react to news. And that's exactly why the market makes the news and not the other way around. Why is Apple stock falling after Apple has released sensational quarterly results? Possibly because investors believe Apple won't be able to recreate such gains in the next quarter to beat the stock's high. Whatever the reasons, we'll never know. In the evenings, the news channels are always fun to find out why the DAX or the EURUSD have risen or fallen. The reasons that are partly given for this are absolutely ridiculous and have nothing to do with reality. It doesn't matter what news goes on the ticker, the market is moving as people and computers push your head to buy or sell. And why do some traders buy while others sell? Well, because they have an opinion, and that opinion often has nothing to do with economic data.

And if you've lost money again, cheer up, dear investors. Business is 50% psychology, and the facts shouldn't be overstated. As we can see in the table, news is important and crucial for most traders. The HFT are an exception here, as they use the algorithms to scan the markets. News is also crucial for big players, after all, you pay their analysts well for it. However, they have a decisive advantage in this, they usually know in advance which results will be announced. Imagine that the big player collects a large number of asks in an accumulation phase. Suddenly an important economic news comes in, which speaks for a euro weakness and a dollar strength at the same time. That should actually push the course down. But what happens instead? The big player wants to bring his collected ask into a profit and will push the course up massively. Afterwards, the press writes that the euro has recovered. Of course, the economy in the individual countries is important, but not for me. How investors react to the news is far more important. Of course, the big players concentrate on market data and currency strength. However, we must never forget that it is the big players who determine with their strategies where the market is going. And that's exactly why I focus exclusively on the big players.
All I have to do is know where the euro or dollar is being bought or sold. And that's exactly why news is less relevant to me. So let's forget about the news and focus exclusively on the strategies of the big players. The big players' footprints are the big absorption packages from Bid and Ask. This is exactly what we have to identify, interpret and develop our strategies from. There is one small exception and that is the weekend. A lot of messages accumulate in these 48 hours. Since there is no market and therefore no price positions at this time, it is impossible to determine how these news will affect the price. At the beginning of the week there is therefore often a wait and see attitude to see how the market reacts to the past weekend. For me, however, what matters is when important economic data is due and how the big players react to it. Of course, I also pay attention to the crucial news in the market, but only to identify the peaks with high volatility. Big players often use this volatility to turn their collected ask or bid into a profit. If you have correctly recognized the collection campaign beforehand, you can use it to negotiate the decisive breakouts. At Forex Factory you get the crucial indicators that show you all upcoming news and even project them into your chart. So if you could identify beforehand whether it is an accumulation or distribution, you can trade this news because you know exactly in advance where the course is going. If the situation is unclear to you, I recommend not to act during this time.

Let's draw a conclusion:

Depending on your approach and strategy, you may be able to forego the price and news. This could potentially save you a lot of time in the future. The market in EURUSD moves because the big players collect in certain phases and then bring their ask or bid into a profit. If you are able to pinpoint this course of action, it will be easier for you to forego the price or the news. Whether this is possible always depends on your individual strategy and of course on the ASSETS in which you are trading.

Inserted Video

I wish you a successful week of trading and I would be very happy if we see and hear each other again soon.

Kind regards Michael

Trading with the algorithms of the big players




Hello dear subscribers,

the new video is online and, as always, you will first receive the English translation. You can find the link from the video at the end of my post.

Today's post will be extremely exciting and interesting as we go into practice. Many have asked me what exactly I see on my trading screen, which I will go into in more detail in the current chart today. In the M1 I gave a specific price forecast that lasted over an hour and we want to see whether it was correct. In addition, we look at my key zones and how they react to the future course. Then I'll show you two trades that I planned and executed beforehand to the point. Finally, let's take a look at the costs that an algorithm trader has to face.

Here you can see my price forecast, which of course I gave in a running chart and I will use my key candles to show you how these zones are created. With my self-developed bionic candle, you can actually see into the future for a limited time. As I explained in my last post, I work with technical analysis, chart technique, fundamental analysis and algorithm analysis. The process is usually always the same. I start with the technical analysis, it continues with the chart technique, then the fundamental analysis follows and at the end comes the algorithm analysis. It is crucial that these four strategies are precisely coordinated. If I were to equate these four strategies with our four elements, the chart technique would be the earth, the fundamental analysis the water, the technical analysis the air and the algorithm analysis the fire. Of course, I also have a fifth element in trading and these are my own tones from best bid and best ask.

Technical analysis is about the question: Why am I buying?
The chart technique is about the question: Where do I buy?
Fundamental analysis is about the question: What am I buying?
The algorithm analysis is about the question: When do I buy?
And my tones especially help me with the question: When do I get out?

My main screen has already caused controversial discussions, always with the same question: Do you really need that much information? If you want to plan your trades carefully in advance, expect a profit rate of over 80% with a CRV of 1.5 and want to take as little risk as possible, then this information is elementary. Let's take a closer look at this. Here you can see a special filtered limit delta that shows me exactly in which area the big players are buying or selling. From this I derive the accumulation or distribution and recognize whether the dollar or euro is being sold or bought. The same special filtered limit delta, but in a smaller time unit, the limit orders are compared with the market orders on the right. Incidentally, the resulting gaps provide very interesting information about future resistance zones. My specially configured trading chart, with my developed Bionic candle. As a rule, I get in and out with market orders. A virtual stop is automatically set that cannot be identified by the broker. Here you can see my special developed currency strength for the euro and dollar. The green zones show the strength of the euro, the red zones the strength of the dollar. The configuration has been changed so that currency strengths change very quickly. Here we see a special filtered heat map. However, the red and green circles that show me exactly when the long and short traders are stopped are decisive. What we see here is not a typical footprint chart, as only special limit orders that are relevant for a quick trading decision are highlighted. This is a 3D spoofing display developed by me, from which you can already identify clear turning points. Since the big players use the same algorithms over and over again, the same processes can be recognized over and over again.

This special display shows the strengths of the limit buy and limit sell orders. This enables absorption to be recognized more quickly. This display can also be used to identify possible fake orders in the limit area. This display is the fastest display on the market, but was not generated from the DoM or the time and sales list, but with special filter settings from the spoofing information. From this you can make very precise trading decisions. As soon as an equilibrium arises in the market, that means uncertainty. For me it is crucial whether the equilibrium takes place on the ask or bid side. The next steps for the big players can be derived from this. Here I get different information about different strengths in order to calculate the effective strength of the limit and market orders. With this special filter setting I can see the positioning of the small retail traders. Of course, the big players have been filtered out here. Here we see different spoofing views that serve the sole purpose of identifying stronger iceberg orders in the market. This is the best way to read out the recurring algorithms. Here you can find various information about the current ATR, the spread, the candle strength and upcoming meetings that are responsible for higher volatility. In the last few years I have changed my main chart over and over again in order to generate the fastest information possible. It is important that these representations must be precisely coordinated with one another is crucial. Of course, in addition to my main chart, I have four other screens where I primarily display my navigation maps.

On May 19, 2021 at 4:10 p.m. I first made a forecast, calculated a new resistance zone from the falling price and plotted it on the chart. I made the first forecast at 4:10 p.m. because I assumed that the course would go up. At 4:20 p.m. the course reached my forecast zone and then ran into my next advised zone, which it reached at 4:50 p.m. My last zone was then reached at 5:20 pm. I forecast four zones within 1 hour to show you how exactly a trader can work with my key candle. Now let's take a look at how my plan worked out. Overall, the result looks very good, but how did I create these zones? Here we see a typical key candle that was also very strong and stopped the course at 4:10 p.m. The downward blue candle was very strong and slowed the high course. The lower key candle was very strong and also held up the course. I then drew my last resistance zone from the course below. Let's take a look at the whole thing now live.

I gave my first price forecast at 4:05 p.m. To save time, I have accelerated the course fifty times. We can now see that the course went up relatively quickly in the first run. I then thought for a brief moment that the price could possibly run into the key candle above, but it wasn't. Now the course ran down into my previously drawn zone. This downward run took place relatively quickly and reached exactly the lowest zone. Then there was an immediate upward reaction and a sideways market initially arose, where the big players collected another bid to push the price further down. On the right side you can see an M1, on the left an M5 chart. The lines I have drawn are immediately mirrored on both sides. This helps me determine the exact key candles and reduce the size of the zones. We are still in a sideways market, with the key candles I can draw the zones precisely, but in the end I need the algorithms to recognize when the price is moving in the decisive direction.

Since the 1-minute candle is the most volatile of all 9 time units, it should be clear to everyone how difficult it is to make a correct forecast for the future. Nevertheless, with the right approach, you can increase the probability in your favor. In the following example I would like to show you how exactly you can work with these key candles. The course was right next to the blue arrow and underneath was a resistance zone that I had created, which from my point of view could push the course up again. So for the last few moves into this resistance zone I planned a short short trade and immediately a long trade again in the opposite direction. I recognized a possible resistance zone that could hold up the course and that's why I wanted to get out at this point. In fact, this is where the biggest pullback of all upward candles occurred, but the price was pushed through after that. My algorithm analysis gave me no clear signals, so I left at this point. Now let's look at the two trades a little faster.

First of all, I got into the trade optimally and I was aware that I had to get out relatively quickly because the price had moved into my resistance zone. I got out of the trade very well and have now waited a few minutes to find an optimal entry. The entry was also good and my stop of 1.4 pip was not started. The course went up relatively quickly and came into my marked zone. There weren't any clear signals here, that's why I got out. Earning $ 300 in 6 minutes is a good result, but what annoyed me was the pip value per minute, which I was absolutely not satisfied with. Now everyone will ask themselves the question how I could have foreseen this resistance zone beforehand.

As I have already described in some of my posts, a key candle is always created from the past and thus projects a strong price zone into the future. We can even see two strong key candles from which I have calculated an average. We go back further and initially see a strong key candle, which was almost taken out again at the beginning of the course. Because of this, the lower key candle was significantly stronger than the upper one. We now go back to our starting point and see how our two key zones have developed. In fact, the lower key zone was significantly stronger as the price was pushed up there more strongly. Here we see two strong upward movements that pushed the price up in the later course. The key candle underneath also had a special strength, as we will see later. The price initially continued upwards, there was a strong breakout downwards and the downward trend was held up by my second resistance zone and rejected downwards. Slowly the buyers came back into the market and the price came closer and closer to my resistance zone. We see that the course was turned down twice and then continued downwards. However, I warn against basing the trading decision solely on the key candle. It is crucial to know when and where the big players enter the market, which currency is currently the strongest and how the strength of the market orders and limit orders relate to one another. The secret is to have these four strategies in view at all times in order to achieve the greatest probability of winning. My developed tones are then the icing on the cake.

Dealing with trading algorithms is inevitably associated with greater effort. I have outlined three different models so that everyone can calculate what costs they will incur. As a start up I would like to describe a trader who has less money at his disposal. We use a processor and a graphics card that meet the minimum requirements, the price refers to a new workstation. The 55 inch 4K monitor is bought second-hand, as are the two HDMI screens, which are often already there. In addition, there are a few extra programs and the sound configuration, so that the hardware equipment costs at least 2500 €. The deposit on the Forex account should be at least € 2000, while the future account should be € 500, as only the data feed is obtained from it.

That is a minimum requirement of 5000 €. The monthly costs for software and data feed are around € 50. Now it is a matter of precisely coordinating the individual PC components with one another, accelerating the Internet with a special antenna, taking special security measures and installing and filtering all of the software. At least 40 hours are required for this. To save further costs, the PC and software configuration is carried out by yourself. At the end, I recommend finding a suitable mentor who will support you in trading for at least 20 hours to get to know the basics.

A trader who wants to deal a little more intensively with the matter must also be prepared to invest more. A workstation with a better processor and a faster graphics card costs significantly more. The main monitor is larger and a little more expensive, as are the two 32-inch screens and the extras that are newly acquired. The hardware equipment already costs € 4000 here. A little more is deposited on the Forex account, on the Future Account € 500 is enough, as we do not trade in this area. That is initially 7500 euros. Software and data feed also cost € 50 per month. If 50% of the PC and software configuration is carried out by yourself, there are additional costs of € 1,000. At least 40 hours are required for a medium-level training. In order to carry out trading algorithms optimally, one should work with very high-quality processors and graphics cards. A 75 inch 4K monitor, four additional screens and all associated extras in the area of sound and programs. That means a minimum hardware configuration of 5500 €. The Forex account is filled with € 4000 and the Future Market account with € 500. This is already 10,000 €. Software and data feed are € 50 per month. If you cannot do the PC and software configuration yourself, you have to reckon with around 2000 €. And for optimal induction you need at least 60 individual hours with a mentor. We'll talk more about the difference between a trading coach and a mentor soon.

Let's now take a look at which part-time income opportunities are possible in the area of algorithm trading. Requirements: The trader has a few years of experience and has already reached breakeven. The capital is 3000 €, 1.5 lots are invested per trade, the leverage is 200, the profit ratio is 65%, the spread is 0.5 pip, the stop is 2 pip and the TP is 3 pip. 6 trades are carried out per day, which is also possible on a part-time basis with a TP of 3 pip. The risk is 1.25% per trade. The profit is € 36,000, the loss is € 20,000, from which € 4,500 taxes are due and a profit of € 12,000 net remains at the end. That's an extra 1000 € per month. With the scalping strategy in the area of algorithms you are able to bring your profit rate to 75% relatively quickly. That is already 1500 € per month. This means that you can recoup your investment in algorithm trading within a year.

Let's summarize again at the end:

With the right coordination of the individual strategies in the field of technical and fundamental analysis, chart technology and algorithm analysis, the probability of winning can be increased significantly. This requires very good hardware and software and, of course, in the end a trustworthy mentor who is not easy to find, however. In my next post we will talk about this in more concrete terms.



I wish you a few nice Whitsun holidays and I would be happy if we hear each other again soon.

Kind regards Michael

Analysis, what do you need a trading coach for?


Hello dear subscribers,


the new video is online and, as always, you will first receive the English translation. You can find the link from the video at the end of my post.

Many of you have asked me to speak a little more intensively about the topic of trading coaches. I would like to comply with this request today and have put together some interesting information for you. Ultimately, this is about a lot of money and the most important thing is that the trader is able to find the best value for money. First of all, it is a matter of clarifying to what extent a training is worthwhile for you and what type of trainer is suitable for you. To say it in advance, I am not a trading coach and I do not want to become one, I do not sell trading signals or indicators, but earn my money exclusively in discretionary trading. There's a snappy remark: what is a training coach? Before the trade he explains you how you win and after the trade he analyzes why you lost. First of all, I would like to make it clear that there are excellent and very capable trading coaches in Germany. You have been in the market for over ten years and have a very high level of specialist knowledge with extensive life experience. Unfortunately, they are a minority in the trading business as most trading coaches don't know what they're doing. We have to assume that only about 10% of all trading coaches are actually worth their money.

The participants are sometimes promised things that are unrealistic and never attainable. It is clear that many participants feel deceived by this. However, this is not always due to the trainer, but often also to the participant. The problem is expectations, which rarely coincide with reality. But this is mostly due to the communication between coach and trader. With today's post I would like to show you what you should pay particular attention to so that both are satisfied in the end. Let's first look at the distribution of traders in Germany, Austria and Switzerland. I am consciously only referring to traders who trade from home with a laptop or PC and not with a mobile phone app. In the Forex market trade 50,000, in the future market 10,000 a total of 60,000 market participants. In the forex market the profitability is 5% and in the futures market it is 15% so there are 4000 profitable traders. 5% are at breakeven and 53,000 are losing. That is a total of 88% of all traders.

Let's ask ourselves a question about this. The loss rates have not improved significantly in the last eleven years, despite the many coaches' seminars, how is that possible? From my point of view, the good 10% of trading coaches cannot sustainably influence the overall market, especially since there are more and more traders entering the market. There has been an enormous increase in coaching in recent years. Those traders who are profitable or who have broken even are less likely to opt for a seminar than a trader who is making a loss. Since the hype with volume trading began ten years ago, more and more trades have taken place in the futures market. But this is exactly where the potential is only at 8,000 participants, while the potential in the Forex market is 6-7 times greater. With the argument that you get much better information in the futures market, many coaches try to motivate forex traders to switch to the futures market. Statements are made such as: The forex market is only for beginners, the professionals only trade in the futures market.

Is the future market really better? In the forex market we achieve a profit ratio of 1:19 in the futures market of 1: 6. thus the probability of winning in the futures market is three times higher. The difference between the forex and futures market lies in the deeper market insight, but you do not necessarily have to switch to the futures market. As a hybrid trader, I still trade in the forex market, but my exchange data is received via the futures market. Of course, I then inevitably have to deal more with the stock market data and know exactly how the market works. I have already discussed this in more detail in this video. Among other things, I examined 40 points there in order to compare the future trader with the hybrid trader. From my point of view there is no difference in execution times, accuracy or manipulation between the exchange or a very good STP or ECN broker. Likewise, the probability of winning for a future or hybrid trader is the same. Let us now look at the points where the hybrid trader has the edge.

The turnover is 100 times higher, the profit ratio is even three times higher. In the forex market there are seldom high-frequency traders who raise prices and the largest big players in the world are demonstrably working in the forex market. The volatility is significantly higher in the Forex market, but the decisive aspect is security. In the future market I am liable with all my private assets, in the forex market only with my account balance that does not go into the red. That alone is a reason not to trade in the futures market. The question remains why the trading coaches encourage you to do so? In the futures market you need significantly more capital for trading and you can lose significantly more because you have to trade at least one lot. Depending on the broker, the costs in Forex are even significantly cheaper. There is no currency strength in the futures market, no virtual stops and entry and exit is sometimes significantly slower. In the forex market there is a much finer price movement, so the bionic candle works much more efficiently in the forex market. And the data feeds are usually more expensive. The only disadvantage of the hybrid trader, he needs a much more complex workstation for trading. From my point of view there are 25 plus and 15 minus points for the futures market, 39 plus and 1 minus point for the forex market and thus a significantly higher efficiency in the area of probability in the forex market.

I have summarized the most important points for me here. Since we always work with probabilities in the markets, every trader should make it as easy as possible for himself. From the point of view of probability, beginners should actually start in the futures market in order to then switch to the forex market. As a hybrid trader, you can save a lot of time. Some training coaches claim that they are professionals in swing and day trading as well as in scalping. Let us now assume that a swing trader is a truck racing driver, the day trader is a rally driver and the scalper is a Formula 1 driver. Now the truck driver gets into the rally vehicle and the rally driver into the Formula 1 car. Although you would dominate the vehicle, you would not have a chance against the competition.

From my point of view there are four different types of traders. The fiery doer, decidedly purposeful and willing to take risks. The blue analyst, precise, level-headed, questioning and strategic. The earth green systematic, empathetic, reflective and constant and the sun yellow practitioner, creative, individual and captivating. I will go into more detail on this in a separate article. Let's stay with the pragmatic trader, he trades in different assets, on different platforms, with different software, prefers different strategies, analyzes different key figures and works in different time charts and representations. The blue green and yellow will also use different things for trading. These include scalpers, day traders and swing traders. I believe that you will recognize that every trader is as individual as a thumbprint and it is precisely this fact that makes it so difficult to teach skills to another trader. Logically, this requires a lot of time that many coaches lack.

I myself have specialized in scalping, I belong to the synthetic, experimental traders and only trade in the EURUSD currency area. The trade takes place in the forex market, the data is extracted from the futures market, I work with a virtual stop of two pip, TP 3 pip, CRV of 1.5-2, profit ratio 75-85%, 1-10 lot, Pip value per minute 1.5-3, trades per day between 5-20, entry and exit with market orders, preferred short trades, trading time: between 30 seconds to 4 minutes, use the currency strength in forex, limit orders in Future, my bionic candle in Forex, different filter settings in the future, and best bid and best ask tones. My trading style is the small breakouts from the key zones. My main strategy I follow the big players, work with five screens of a professional workstation and fiber optics. This is my setup and my strategy, so I would not be able to offer a swing trader or day trader any concrete assistance.

Every trader has his own, individual setup that is similar to Formula 1. No Formula 1 driver can cope with the setup of another driver. In Formula 1, massive data is collected and evaluated. But the big players work with significantly more data and are supported by elaborately programmed algorithms. By now it should be clear why a laptop with an indicator does not bring the hoped-for profits. This requires significantly more complex software and charts to assert oneself in this market. Let's stay with the pros and take a closer look at 4 of them. The fastest bird in the world is the peregrine falcon, it can sometimes reach more than 340 hours of kilometers in its nosedive flights. The sailfish is the fastest fish in the sea and can reach speeds of up to 110 km / h over short distances. The fastest mammal in the country is the cheetah, which can reach a top speed of 120 kilometers. The sperm whale is the best diver in the world. He can stay under water for up to 4 hours and dives up to 3000 m. They are absolute professionals in their field, but there is competition. By the way, the duck can also fly, swim, run and even dive. But it is not really good in any of these properties and would therefore not stand a chance against the four competitors. A trading coach who claims to be able to do anything is also just a lame duck.

It's the same as with all-weather tires that can do everything. If someone only drives a few 1000 km per year, they are well served. At the latest when braking, the differences quickly come to light. It is therefore clear that the all-rounders are usually inferior to the specialists. The big problem with coaching in trading is the fact that most traders don't even know what they need. And that's completely normal, because that's how it goes in our lives every day. The first question, do we need a tablet or a smartphone. Once that question is answered, the next one comes up: what size and model? Is prepaid or, better yet, a contract enough for this? Which services are required, how high are the costs and which provider can be used? Now imagine that you come to an o2 store and want a certain iPad that the retailer does not have, with a telecom tariff. What will happen? Will the dealer send you away or will they want to convince you of their products? Exactly the same thing will happen to you with a bad trading coach.

Another question that arises is how should your coaching work in a group training or rather in a one-to-one training? Studies comparing the efficiency of individual versus group lessons have shown that both groups were able to improve their grades. However, on average better grades were achieved in individual lessons than in group lessons. Now everyone will say that one-to-one tuition is of course significantly more expensive than group tuition. On the other hand, group lessons are significantly more inefficient, as you cannot deal with the individual individually. The next question to ask is whether coaching or mentoring is better. Let's look at coaching first. Coaching is task-oriented. Coaching is often quick, with a trial phone call to clarify whether the trader actually needs a coach. If there is an assignment, the coach sets the specific goal so that both of them work very focused on achieving this specific goal. Then a seminar takes place relatively quickly, where several participants are taught the same goal. There are also video courses to work through. As a rule, individual training sessions do not take place. The role of the coach is to improve traders' performance. The disadvantage here is the fact that the trainer cannot go into depth on the individual problems of the participants.

Mentoring is based on a relationship, whether it is trading or personality mentoring. Often it is not just about doing the tasks in trading better, but also developing one's self-confidence and skills in equal measure. Mentoring is based on a long-term relationship and is not about acquiring skills in the short term. Mentoring takes time to build trust, but also patience and time to achieve the mentoring goals. Many traders do not lose contact with their mentor even after a regular mentoring relationship has expired. Mentoring is about the development of a person and not about completing a task that is the big difference between mentoring and coaching. For this reason everyone should think about what is best for them.

There is also another important point and that is your personal marginal utility. Most traders lose money and it takes at least 6000 screen hours to break even. If a part-time trader trades 4 hours a day, that is over six years. The breake even zone is the hardest thing to achieve. The subsequent area of profit is then much easier to reach and then it is about optimization. The greatest marginal utility thus represents the breakeven point. Therefore, one should ask oneself what one needs the respective trading coach for? I recommend that you first determine your point of view and then define your goal.

First of all, you should deal with the question of what type of trader you belong to and in which area you feel comfortable. Then you should ask yourself what exactly do you need a coach for? Then comes the decision for group or individual training. And from that the decision whether a coach or a mentor would be the better choice. If you can answer all of these questions for yourself, you have made significant progress. In the next week I will show you how and where you can find a good coach or mentor, what costs you will incur and how you can protect yourself from unpleasant surprises.



I wish you a nice and successful trading week

Kind regards Michael

You are a scholar . You have yet to understand who is a market maker. Why Exchanges appoint market makers ? What is expected of them? Why do you call it a conspiracy if they are doing their job?

What is auction process? Is a cartel legitimate or not? Why cartels are tolerted in capitalistic systems.particularly in open bidding?

Liquidity, my friend, keeps the markets tradable.

Can you contribute to liquidity by reading the tape? You have no idea how many sellers are sitting in the dark. But the market makers and the cartels have the figures. They can confidentally move the markets by making them wet and dry.

Reading the tape is akin to using palmistry . Trying to guess when the markets will become wet or dry.

Walking blindly with meagre financial resources needs the help of intuition and falling back on the power of observation - both of which take years of practice to record inputs to brain hard disk for outputting intuition.

Why are you giving false hopes to people to use tools of "certainty" for operating in an uncertainty bidding pricess? A normal brain is not wired for that kind of activity.

Hi Simnz

I think we can determine liquidity conditions accurately by reading the tape because these market makers have to play their hand eventually.
Using the futures market, we can read the liquidity density of these marker makers orders and establish their intent.
I myself like Michael mainly trade the EURUSD scalping the market data from the CME futures data. Here I have to establish the amount of liquidity the market makers are leaking into the market before I can act on the volume data.
As Michael said, its far easier to use that information to trade spot FX.

Taking Friday's action, they were keeping the density dense about 2:1 of first Sellers over Buyers then they flipped to 2:1 Buyers over Sellers.
They in effect burn rubber into the road with their burnouts because they left continuous orders on the market to block Sellers or Buyers from breaking shallow pullbacks.
They therefore established absorption conditions with large order blocks which can be read on the tape if you look and understand.

Myself and Michael are on different roads but we view the same destination, we use different tools but we see what needs to be seen.
Our brain is wired for reading the tape if we wait for clarity of vision to appear.

I am not oppsing the practice of reading the tape . Neither of reading palm leaves. I do that myself.

It has taken me 36 years in gaining proficiency in tape reading using my brain to understand bidding antics.. My montly return is 25% of the margin capital. Since I have no agenda, I dont share my trading records. I can share with you not to impress you but to encourage your journey.

My ojection is to calling of the market makers and cartels as conspirators and persuading non- suspecting people to make feel as if trading is like any other profession. It is the most toughest job comparable to that of a sports person or an entertainer or a surgeon, or a scientist taking decades to gain some profiency.

He is a bad teacher.

I have 36 years of trading spot, futures, and options covering currencies, commodities, indices, shares, bonds, interest-rate futures, forwards, and swaps.
I started learning about Dem/USD futures in 1982 when I was a financial journalist. Having no margin deposit to trade even 1 contract, I was just noting down the prices in a rough notebook and used to imagine different scenarios for fun.
1983 was the turning point of my life when I quit the full-time daily newspaper job and starting weaing two hats - one of a part-time journalist and another of a marketing entrepreneur. It took 8 years for me to be in decent money where I could put in some money in financial trading. Making passive income and investing in various assets, I continued my marketing enterprise until 2001. It was when I realized the web is going to put me out of the marketing business forever. So I closed down my business in 2001 without waiting for the D day.
WWW was a curse then and later turned into a blessing in 2002 when I saw trading of OTM spot, exchange-traded options, and futures can be done online.
After a long stint of practicing, I finally realized I just have to focus on only one aspect of the market that of the bidding antics employed by the market makers to keep trading markets alive, dry, and wet. It applies to any market where auction-style bidding is conducted.

No one on this earth (except the insiders) can make forecasts. So what is the point of me wasting time on pre-analysis? Just enter the trading arena and then start thinking of trading tactics and not earlier. I also felt that whenever I am following any tips, or forecasts (including my own), I was making it my mission goal. When trading starts, I was actually trading to prove a point rather than focussing on the risk or profit targets.

After Brexit, I lost interest in GBPJPY. HK permits only 5 times leverage. I started looking for a new volatile trading instrument. My goal was looking for futures that can be traded with 10-12.5% margin capital and giving high low volatility of 2% or 2.5% daily. The calculation was that I should win 10% of the daily high low (0.2%) so that I could make 2% on my margin capital daily.

It was a herculean task, so I used inddex futures and futures options of HK, German and US market plus GBPUSD futures and options devoting not more than 1 hours on each market. It now works and I am getting closer to my profit goal.

Factory of the vanities

Hello Simnz,

First of all, I think it's very nice that you have found your trading approach and feel comfortable with it, although some people who have already traded with you have PMed me that you are only a demo trader. I cannot judge whether that is the case, after all, everyone has to come to terms with themselves. Basically I would like to point out that I started this blog exclusively for myself as a trader's diary to document my own progress and not to teach other traders how to trade. If someone implements my ideas to get an advantage, they will always do so voluntarily.

I've pointed out a thousand times that I'm not so cocky as to believe that I'm doing the right thing. I accept any other opinion, but you seem to have big problems with that. Maybe it will help you if I confirm that you are right in your world, are you satisfied then? I don't understand, if you don't like the topics on our blog, why not just ignore this blog? You are a pensioner, but do you have so much daytime free time that you have to spend hours dealing with it? After all, I don't come into your blog and argue with you about which of the two of us is right. First of all, I don't have the time for it, because I am in trading for 12-13 hours every day, and secondly, this market is not about who is right, but rather that every trader finds his own personal approach. And unfortunately there is no discussion about that.

Since I have some time and inclination today, I would like to answer you in more detail to help you. Life is all about vanity, so I've been thinking about where I could have pissed you off. In my last video I looked at the trading coaches a little more critically, after which you have already written 3 posts. I seem to have stung a wasp's nest. Then my next video, which comes out in a week, will cause you even bigger problems.

On December 27th, 2020 you submitted the following post: “Can FF members please post some simple trading systems that do not use indicators to predict direction. I am 72 years old and as a social project I am teaching older people who enjoy trading as a game to keep their brains active and to make a passive income from it. "
Basically, I find it very commendable when you help others without asking for money. But if someone has been trading for 36 years, shouldn't they know how to help other people trade? I find it very questionable to use simple trading systems that you haven't checked yourself to enable retirees to earn a passive income. Helping people with his personal experiences for free would be much better.

Rick has already tried to give you a clear answer in his friendly post, which unfortunately you did not understand. Coincidentally, just like Rick, you started your blog at Forex Factory in 2015. Rick has three times the monthly growth of subscribers on his blog as you do, which means that he may address topics that are more interesting and understandable for traders. Membership in a blog is always voluntary, the traders are not stupid and always choose the best content that will help them.

What also amazes me is that you address things that neither of us has ever claimed or said and unfortunately your arguments are not constructive. Maybe this is due to the translation, the language or simply because we live in different worlds. I notice how much things upset you and I don't want health problems to arise from them because you are no longer the youngest. I understand that you view the market differently and I accept your opinion. We expect the same from you too. In the future I have no interest in discussing things with you that you cannot understand because you do not work with algorithms. When discussing with one another, it should always take place on the same level, which is unfortunately not the case in our case.

I wish you from the bottom of my heart that all things develop as you deserve in the future and I also wish you a lot of strength and especially health.

Kind regards Michael

Hello Michael

Thanks again for your video and thoughts.
I just wanted to highlight the above part in your answer to a member - it seems a LOT of "traders("newbie or not")" does not grasp that at all!!

** from the post by member RickM: " we view the same destination, we use different tools but we see what needs to be seen"!

Trade well / Cheers / Mos

You should do without these trading coaches


Hello dear subscribers,

the new video is online and, as always, you will first receive the English translation. You can find the link from the video at the end of my post.

In my last post we talked about the goals of coaching and mentoring and how to find out which type of coaching would be optimal. Today we talk about what to look for when looking for a coach or mentor and how to find the right trainer. In addition, you will receive a requirement profile that, in my opinion, a good and serious coach should meet. We also look at the costs and when coaching is actually worthwhile. Unfortunately, there is no Stiftung Warentest where you can compare the individual providers, so you are forced to listen to your inner voice. Most decisions are made emotionally, and many coaches use this situation to their advantage.

Before you can develop yourself further with the help of others, you first have to determine your own point of view and a possible goal, then the type of training and, at the end, the ideal training partner. Basically, we need to know that learning to trade takes either time or money. Let's start with the possibilities that cost time but not money. You can find a lot of good information on YouTube, I particularly recommend watching the videos from America. There you will get all the information you need. There are large trading forums for example Forex Factory or Future forums in America, where you can get excellent information. I myself created my own blog at Forex Factory over three years ago to write a trading diary, which enabled me to expand my knowledge incredibly and now I belong to the 5 best-known traders in Germany with almost 900,000 members. Over time, I developed my own strategies and got to know a lot of interesting traders. This communication resulted in friends with whom one exchanges regularly in order to initiate new ideas and projects. I also got to know very successful traders through my channel on YouTube who would never go public.

Now let's look at the options that cost money. Trading books also help to expand knowledge, although there you should refer to the recommendations of the readers. Trading videos are also available on the Udemy platform. For about 20 € you can get up to 20 hours of video material, but I can't make any statements about the quality because I used the platform for videos for programming. And they actually helped me. At the end there are still the trading coaches and mentors, which we are dealing with in more detail today. The biggest challenge lies in breaking even. A full-time trader needs an average of three years and a part-time trader at least six years. Most part-time traders want to be successful as soon as possible in order to be able to trade full-time. That's why you are ready to hire a trading coach. In fact, you can save a lot of time with a training coach, provided that the information is helpful to you. First of all, should you be clear about whether you need help in a specific area or whether you are ready to start from scratch? If you want to adopt a certain strategy from a coach, you may have to throw the knowledge you have learned overboard in order to absorb new knowledge. The question is, are you ready for this?


Let us first deal with the question of why a trader becomes a trading coach at all.

First, because he doesn't make any money trading.

Because he doesn't earn enough from training

Because he dreams of great wealth

Because he also needs a secure income

Because he wants to build up a second mainstay in addition to his training.

Because after ten years of training he is looking for further development

Because he wants to help others, but in this case he could also become a mentor.


Of course there are other different motivations why a trader becomes a coach, I definitely recommend finding a coach who does this because he wants to develop himself further or he wants to help others. However, the search is not that easy. There are over 500 different trading coaches in Germany, Austria and Switzerland, but the market is very limited as there are only 60,000 traders. For this reason, a coach has to offer something special that the others cannot. And that's why statements are often made here that are not entirely true. Imagine you are a lottery player and one day you discover a code to regularly hit the jackpot. You build yourself a small computer that you can use to generate your numbers on a regular basis. Honestly, would you sell this computer now or would you rather hit the jackpot yourself? If a trader had indeed found the holy grail, would they be willing to sell it? And it is precisely for this reason that a lot of information that you receive, from 90% of the coaches, is nothing more than mass-produced goods, which you can also obtain for free on the Internet.

Basically, I am not negative towards advertising, but certain advertising spots on YouTube really get on my nerves, I think you know do that too. Advertising is understood to be the dissemination of information to the public or to selected target groups by mostly profit-oriented companies with the purpose of making products and services known. In this example we see a funny commercial about Ceddar cheese, but it succeeded, and which you can watch over and over again. Why is a training coach ready to advertise for some € 100 or € 1000? Quite simply because it makes him more money than his own trading. And that's exactly what we should think hard about. To be honest, if a service or a product is offered somewhere at a sensationally low price, word gets around like wildfire and the item is sold out within a short time. If a coach is really good, word gets around very quickly because the traders are satisfied and then he doesn't have to advertise. And even if the trading coach has no customers, why doesn't he act himself during this time to finance his costs. After all, he shows other traders how to make money by trading. Then why does he even advertise?

As we all know, customer reviews on Amazon or eBay cannot always be trusted. The same applies to ratings in the service sector. I know many companies who offer their customers a discount when they write a positive recession. In the entire financial services sector, the average satisfaction rate in Germany is 75%. Interestingly, 362 trading coaches received an average rating of 90%. A rogue who thinks evil.


How do you recognize a serious trading coach?

He does little or no advertising on YouTube
Shows you some live trades in the forex market
Is ready to give in-depth, free tips
Does not sell a mass product that everyone can use
Develops your own creative approaches
He don t put monetary things in the foreground
Helps you reach your breakeven point
Provides you with his personal setup
Helps you assemble your workstation
Knows exactly how the market works
Is familiar with hardware and software
Carries out individual coaching or a maximum of 3-5 people
Can explain how the big players work
Knows examples of the use of algorithms
He avoid classic volume trading
Addresses your strengths and weaknesses individually
He works with forex and stock market data
Can figure out the most effective asset for you
He know, that there are no patterns in the price or chart
Knows the pip value per minute
He don t make long-term price forecasts
Does not sell trading signals or indicators


Imagine you are a doctor and you have your waiting room full of patients. You call on everyone who has a cold and carry out a uniform mass treatment. I think we all agree that no doctor in the world would do that. Of course, a doctor could earn more money with it, but every patient is unique and deserves individual treatment. A trader is also unique and individual, why should he get involved in group training?


In addition, I recommend that you avoid coaches who ...

... put yourself under time pressure
... who tell you how easy trading is.
... that promise you that you will earn a lot of money
... which reduce their trading products
... who are talking about a special offer
... which have their place of jurisdiction abroad
... who do massive advertising
... who flaunt money, real estate or cars
... who want to change you completely
...who make their competition bad
And the most important point
... he don't seem honest to you


A good trading coach ...

... helps you to understand the market.
... shows you where the big players buy and sell.
... helps you with time management as a part-time and full-time professional
... supports you in the selection of assets
... helps you in the area of hardware and software
... has a clear procedure
... is fundamentally familiar with tax and finance law
... helps you with money management and risk analysis
... knows the difference between cause and effect indicators
... knows how to use the native and synthetic iceberg orders
... can explain DoM, time and sales, heatmap and spoofing to you in detail
... gives you psychological support through his own life experience
... helps you with your trading evaluation / analysis
... provides you with his personal setup


If we think about it for a moment when we buy a new vehicle, how do we proceed? First we select different vehicles, look at various test reports on the Internet, then make personal phone calls with dealers, take a test drive, then make a decision and conduct individual negotiations again before we conclude the sales contract. This is exactly how we should proceed when choosing a trading coach. When you have made a selection of five or six different trading coaches, you should have a personal phone call. If the coach does not have time for you and someone other on the phone makes the call, I recommend you leave it. The mass treatment already stats here.

There are four key factors in trading. We start with the hard skills. This means the basic trading knowledge, strategies and procedures. Next, soft skills are a crucial factor. This means the methodical competence that supports our hard skills. Then there is psychology and self-reflection. The third shamrock is the hardware. This includes the complete composition of the workstation including sound and screens. Another point that should not be neglected is the software. This includes setting up the trading screen, reading out data and filtering the evaluation software. As a rule, the subject of hard skills is dealt with well in the training, there are deficiencies in the soft skills of the hardware and software. Now some will say that a trader does not have to be familiar with the hardware and software, but here I have to partly disagree. A pilot also has to deal with his aircraft, which is particularly noticeable during the PreFlight Check when he inspects his aircraft before take-off. A trader who is familiar with his technique often has a decisive advantage.

Let's come to the cost of a trading seminar. The prices vary massively between 3500 € -20,000 €. From time to time, high trading costs are compared with the pilot's license, which costs 70,000 € and is also an investment in the future. Let us take a closer look at this argument. The training to become a pilot takes two years; moreover, Lufthansa bears a large part of these costs provided that the pilot continues to work for Lufthansa afterwards. The training time is 3400 hours. That is an average cost of € 20 per hour for a commercial aircraft pilot's license. Incidentally, the starting salary of a pilot is € 5000 gross per month. That is an hourly wage of 30 euros. Let us now consider a training offer of 5000 euros for an annual training in which 20 people are involved. 30 videos, a three-day seminar and 30 Skype conferences with all 20 participants are made available. That is a total of 84 hours for the coach. The participant pays € 60 per hour, if we exclude the videos, it is € 100 per hour. However, for general group training. The training coach gets an hourly wage of € 1,850. From my point of view, this is not only outrageous, but a complete rip-off.

What I would find absolutely fine would be if a participant could get 50 individual Skype lessons for 5000 €. In this way the trainer could adjust to the individual participant and I am convinced that the chances of success would be 1000 times greater. If the coach is hardworking, he could individually train four participants in 200 hours and would still earn enough money with it. From my point of view, the dream of getting rich on the stock exchange is being exploited here to call up outrageous prices. Therefore I believe that there are fewer and fewer people who are willing to pay these prices in the future. The first coaches have already noticed this, as the number of their participants is falling dramatically. What I do not understand is that the trading participant pays without making claims. The customer is king and not the coach. But many traders hope for a successful entry into the million dollar market of the stock exchange.

Don't just let the money be pulled out of your pocket and compare the price-performance ratio. I know it's difficult, but I would always value a individual coaching.

Invest a maximum of 20-40% of your risk capital, at 5000 € this is a maximum of 2000 € for coaching.

For this I would expect individual coaching of at least 20 hours.

Joint live training in the largest market in the world

Forget the videos, you can also get the information on the Internet

And let you explain how the big players work

In addition, the coach should address your strengths and weaknesses individually.


The coach and the training participant should always work according to the WIN WIN principle, a business is good, when both are satisfied. Most of the time it's just the coach. If you cannot find a suitable trading coach who meets your requirements, you should look for a suitable mentor. Konrad Adenauer was the mentor of Helmut Kohl and Helmut Kohl was the mentor of Angela Merkel. You can say what you want about the party, but these three politicians still enjoy an excellent reputation around the world. And the previous and intensive mentoring was essentially responsible for this. As we know, mentoring is relationship-oriented, long-term and therefore development-oriented. From my point of view in the trading area the best approach. Let's take another quick look at the part-time trader who typically takes six years to break even. Let's assume that this trader only finds his personal mentor after two years. With the help, he is able to break even two years later and has saved two years.

First, let's look at how it would go without a mentor. In the first six years a loss of € 12,000 is achieved. From the seventh year he is in the breakeven area and after that he makes profits. After ten years he is easily profitable and has good chances for the next few years. Since the trader only finds his mentor after two years, he naturally makes the same loss for the first two years. With the help of the mentor, the loss is reduced to 1000 euros and in the fifth year he already reaches the breakeven point. The following years are then much more positive; in the overall result, that could well be an advantage of € 54,000 in ten years. But let's first look at the short-term area. That would be a benefit of € 8,000 within six years. The question is, how much are you willing to invest? The idea that the coach only earns money if the trader earn money on the stock market would also be interesting. The industry would probably die out as a result. Of course, every trader wants to become successful as quickly as possible, but the stock market is so complex that the clocks tick differently here. The most important quality of a trader should be patience. A blade of grass doesn't grow any faster if you pull on it. So there is strength in rest.

In my opinion, a good trading coach or mentor is just as difficult to find as the right life partner. And I don't need to tell anyone how often we have made the wrong decision in this area. The exchange opens every Monday and closes on Friday, there is no need to rush. Take your time to find the right trading partner, everything else will only cost you unnecessary time and a lot of money. Still 88% of all traders lose their money. You shouldn't belong.



I wish you from the bottom of my heart that you always make the right decisions and the success that you deserve for your future.

Kind regards Michael

Plan the trading efficiency with my new Excel spreadsheet



Hello dear subscribers,


the new video is online and, as always, you will first receive the English translation. You can find the link from the video at the end of my post.

In trading, there are no reliable price forecasts or strategies that show us the future price development. And yet there is a great ally and that is the probability. In addition, there are factors such as CRV, pip value / min, the range between profit and loss and the expected value. Bringing all these things under one roof is a great challenge. For this purpose I have created a special Excel table for you today, with which you can see all these things at the same time. I'll show you examples of how you can double your income with small changes without increasing your risk. First take a look at the video, at the end you can download the table for free from my blog. In my video on how we can effectively reduce the trading tax in 2021, I have already discussed the deductibility of future trading losses in more detail. In addition, different alternatives were examined to reduce the trading tax. Let us look again at the text of the law. Cumulative profit transactions with futures can be deducted up to € 20,000 per year. The remainder is carried forward indefinitely and can be used up to € 20,000 in the following year if there is still a profit that can be offset within the year. That is also logical, because a loss carryforward can only ever be offset against newly generated profit.

In 2021 a trader will make a profit of € 72,000 and a loss of € 40,000. Since he can offset a maximum of € 20,000 in losses in this year, there is a loss carryforward for 2022. If he achieves the same profits and losses in 2022, the loss carried forward from 2021 and the loss from 2022 will now come into effect. Now let's look at how I interpret the new tax legislation. In 2021, € 72,000 in profits will be made, € 40,000 in losses and a maximum of € 20,000 deductible. There was no loss carryforward from last year, as the law was only introduced in 2021. This means that € 52,000 is taxed and a tax of € 13,712 is due without church tax. In the next year, the same profits and losses arise, € 20,000 are deductible and the loss carryforward from last year is also added. The tax is € 32,000, which results in a tax amount of € 8,438. If profits and losses remained the same, the tax amount would remain at € 8,438. In four years that would be a tax amount of € 39,000. Before the tax reform, the trader would have paid € 5,000 less. I would like to make an important statement at this point. I am exclusively a private trader and transmit the trader tax information as I understand it in the legal text. This can lead to errors of interpretation at any time, I am not liable for you. For this reason, I recommend that each of you always discuss your individual situation with a tax lawyer, tax advisor or auditor.

Let's look at key factors in trading that I'm going to discuss in more detail today. A trader only reaches his breakeven point if he takes these factors into account and combines them with one another. The greatest challenge lies in linking these factors. For this I have built a tool for you that will support you. There are also four other factors that I have developed: pip value per minute, dollars per minute, the range between profit and loss and the tax value. There are many ways to evaluate your trades, today I would like to introduce you to my approach. First of all, I need the time when I entered the trade, the trade direction, the currency pair and the entry price. Then I need the exit time, the exit price, the number of lots, the spread, the stop size, how many seconds the trade ran and the result of the pip. From this I can calculate the pip value per minute, the profit achieved, the profit that would result from it per minute, the CRV as well as my individual grading. Now the individual trades are continued in the same way. A little tip on the side: I always record my trades with a video program in order to check them more closely afterwards. Let's briefly analyze these 18 trades.

On average, I was in the market with 2.4 lots, the spread was 0.6 and the stop was 1.4 pip. A trade lasted an average of 30 seconds, including losses of 1.5 pips with a pip value of 5.2 per minute. The expected value was $ 31 and the potential was even $ 120. With a win rate of 83%, a CRV of 1.1 was achieved. My average rating was 2. Next, the trades were sorted into long and short. The profit rate for the long trades was 90% while I only got 75% for the short trades. With the long trades, I made more overall, but on average only $ 32 per trade, while I got an average of $ 67 with the schort trades. There are already very good evaluation tools in MT4, and you can also use other offers on the Internet. Due to the inadequate data security for me, I only analyze my data offline, especially since the pip value per minute is also not available online.

Let's take a quick look at the pip value per minute and why it is so important to me. We see an upward movement in the M1 here. 20 pips were achieved within 30 minutes, that is 0.66 pips per minute. After that, the course went back and reached exactly my key candle. You will find that this key candle was the strongest candle in the upward movement. You can get more information about this in my videos. The downward movement occurred within 4 minutes, reaching 18 pips. That's 4.5 pips per minute. On the up move I had to risk my money for 30 minutes while the down move only lasted 4 minutes. The average of the up and down movement was 38 pips in 34 minutes. That's an average of 1.2 pips per minute. So if the average risk is 1.2 pips per minute, movements smaller than 1.2 pips automatically represent a higher risk. Movements greater than 1.2 pip per minute, on the other hand, represent a lower risk. Viewed from the average, the upward movement was 100% riskier, while the downward movement compared to the average represented a 3.5 times lower risk. Overall, the downward movement was 6.8 times faster than the upward movement and thus the risk was 6.8 times smaller. We recognize: the risk and the pip value per minute are always contrary to each other. For this reason I always try to achieve a higher pip value than the average in order to minimize my risk. In my long trades, the average pip value was 3.6 and only 77% of all winning trades exceeded the average of 1.5 pip per minute. In my short trades, the average pip value was 7.2 and 100% of all winning trades exceeded the average of 1.5 pip per minute. So the downward movements for the pip value per minute represent a great potential. You can find more information about this in my videos

Before a trader becomes profitable, he needs a good strategy and an auxiliary tool with which he can analyze his strategy and money management. I have developed a new tool for you in Excel that you can of course get for free. Let's take a look at the tool first. The input tool is on the left, where 9 different inputs have to be made. We start with the capital on the broker account, the leverage, the number of lots that are traded, the average profit rate, the spread, the stop, the TP, the number of your trades per year and the tax rate. In the basic setting, capital gains tax including the solidarity surcharge is calculated; church tax is not taken into account here. After your entry you will see the tax limit of 833. That means after 833 trades you have reached the tax limit of 20,000 €.

The maximum pre-tax profit of $ 10,000 applies to the 833 trades. Now the calculation bar follows, where the spread, the stop, the TP and the profit and loss ratio are shown again. From these entries, the average profit, loss and the effective result are now shown in pip. The profit and loss is now converted into money, at the end the expected value before tax appears. The average profit of 36 € × 1000 trades results in a profit of 36,000 € at the end of the year. The loss is € 24,000, but only € 20,000 of this is deductible. This results in a taxable income of € 16,000. The real profit is € 12,000, from which the tax is deducted and a net profit of € 7,781 remains. This is a disadvantage of € 1,055 compared to the old trading tax. The effective capital gains tax is 35.2% provided that all losses can be deducted. This is only a comparison value to get as close as possible to 26.37%. Since only € 20,000 loss can be offset in the first year, € 4,000 loss is carried over to the next year. For a better overview, I have given the duration in months. Now we come to the evaluation. The market capital refers to the number of lots, the margin refers to the number of lots, the capital and the leverage. The risk per trade is 0.6%, the tax rate is 33.3%. That means I have to pay 33.3% more taxes in this constellation than in the old tax world. The smaller this value the better. The range between profit and loss is 66.7%, which means that the loss makes up 66.7% of the profits. The further the profit is from the loss, the smaller the range P&L value and the less tax you have to pay. The gross CRV is 1.5, the value is calculated from the stop and the TP. With the net CRV, the spread is factored in. The payoff ratio, calculates the average profit divided by the average loss. The net expected value refers to the value after taxes. The monthly profit is 648 € and the monthly return is 6.5%.

So that you can compare different strategies with each other, I have added another table below. We are now changing three factors. First of all, we look for a broker who allows a leverage of 200 and protects us from a negative account balance. We are increasing our profit rate to 5% with the help of my Bionic candle and reducing the spread by having found a good broker. The tax limit increases instantly to 1,143 trades and the maximum profit is $ 24,000. The profit increases by $ 3,000, the loss is reduced by $ 6,500, a maximum loss of $ 20,000 is deductible. Because of the higher income, I have to pay $ 5,500 more in tax, the cash benefit is $ 9,500, and after tax is deducted, $ 8,000 more remains. This does not result in any tax disadvantage and the effective capital gains tax is 26.4%. Below is the calculation bar and the evaluation on the right. Where have we improved now? The margin has been reduced by six times, the risk has become smaller, the tax value is zero, profit and loss are further apart, the net CRV has improved, the payout ratio has also doubled and the net expected value has doubled. Likewise the profit and the return.

Next I want to show you why a professional trader with a high profit ratio will not have any problems with the new trader tax. We use our evaluation tool for this. The profit is € 480,000, the loss € 100,000, € 20,000 remains deductible, € 460,000 is taxable, € 380,000 is available in cash, the tax is € 121,000 and the net amount is € 259,000. It is interesting that there is just a tax disadvantage of € 21,000. The effective capital gains tax is 31.9%, financing a GmbH would be significantly more expensive here. You can see that there is a monthly return of 71.9%. This return relates to the capital of € 30,000. However, we must not forget that this professional trader is trading with 500 leverage. With ten lots he is trading with a capital of 1 million that his broker has made available to him. If we now put this 1 million euros in relation to the profit of 259,000 euros, the annual return is 25.8%. In relation to his deposit of € 30,000, however, the return is correct. Let us briefly consider the tax situation. After the year 2021 has ended, there are four loss carryforwards for the following years. If profits and losses remain the same, the loss carryforwards will continue into the next year.

From the fifth year onwards, in this example, he is placed in such a way that he can actually deduct all losses incurred. From the fifth year the tax remains at € 100,000 per year. If we compare the old tax with the new trader tax, the result is a disadvantage of 53,000 € in ten years. This means that there is an annual tax disadvantage of € 5,300. In relation to the net income, this is only 2%. Instead of € 259,000, the professional trader earns € 254,000. If you were to earn € 380,000 per year as a self-employed person, you would have to pay at least € 162,000 in taxes. Despite the new trader tax, this is still a benefit of € 60,000 per year. That means with the right strategy you don't have to found a GmbH or move abroad. That should just show you that you can trade profitably in Germany, despite the tax.

Now I'll show you how a trader can double his trading income with a few simple steps. We are looking for a broker who offers us a leverage of 200, so we reduce the margin by five times. We are increasing the number of lots from 1.5 to 2 without increasing the risk, and with the new broker we are reducing our spread. Please note: The capital remains at € 5,000, the profit rate does not change, stop, TP and the number of trades also remain the same. Nevertheless, we are able to double our profits and returns. For this reason, I recommend everyone to work with this table. I have created two tables for you in different designs, one light and one dark. Due to the somewhat complicated way the pip is calculated, I have given the currency in dollars. You can download the table for free on my blog at Forex Factory. You can find the link in my description. The table is also interesting for other countries, but the tax legislation should then be taken into account. If you want to know exactly how to get to my blog at Forex Factory, check out my video on Forex Factory.

We come to the conclusion:

As a beginner, it took me over two years to understand the importance of money management, CRV or expected value. Trading is always about optimizing probabilities, with my developed table, you can check your strategies faster. Then you should individually evaluate your individual trades to check whether your strategy has worked. Every good company prepares a monthly profit and loss account and a balance sheet at the end of the year. This enables the company to react more quickly to changes. As a trader, you basically also run a small company. I would be happy if I could help you with my idea, I wish you every success with the analysis with my new tool and of course in daily trading.

Inserted Video

Kind regards Michael



I do not assume any liability for the correctness, completeness and topicality of the information in my files, which are provided free of charge. The content of this file is for information purposes only, it does not constitute investment advice or trading advice. Please note that you use the data I have provided free of charge at your own risk.

Plan the trading efficiency with my new Excel spreadsheet in English

Hello dear subscribers,

Since the majority of you do not speak German, I have of course translated my table into English for you. Please note that there are different tax laws in every country, so the Excel table should be adapted individually. Please also have a look at my latest video. I hope this helps you.

Kind regards Michael

Attached File(s)

Moneymanagement Bionics english.xlsx   36 KB | 783 downloads

Breakouts, as you can see the tendency beforehand!



Hello dear subscribers,

the new video is online and, as always, you will first receive the English translation. You can find the link from the video at the end of my post. In my video I discussed 10 live forecasts that I cannot deliver to you as text this time. Therefore, I ask that the English-speaking participants on YouTube have the text translated with subtitles.

In today's video I would like to take you on a week's trip, where I made ten predictions about the possible and future course of the course. You can then immediately see how right or wrong I was. In some of the videos on my channel we kept talking about my specially filtered limit orders and how important they are for a future price forecast. With this video we will examine these limit orders more closely and to what extent they can actually provide a reliable price forecast.

Coincidentally, this week, with around 300 pips, the strongest weekly movement in over 61 weeks occurred. From Tuesday to Friday, I made a total of ten forecasts in the current chart, which we will examine in more detail. Basically, the greatest volatility was to be expected on Wednesday, June 16 around 8:00 p.m., because the Fed announced a statement and a press conference there. The euro-US dollar was down 148 pips on that day, almost twice the average daily range. The next day's headline read: Fed decision drives the dollar. But is this statement true and was the fed actually responsible for the fact that the share price fell so sharply? We will deal with the question more intensively at the end and you will be amazed what comes out of it.

Let us now start with my individual forecasts and the accompanying explanation. We start on Tuesday, June 15, 2021 around 9:00 a.m.

(You can find the translated text as subtitles on YouTube)

Let's take a quick look at how my prognosis turned out. Since I started producing my new video at 3:40 pm, I can of course only show you the course up to this point. After all, the price has moved around 60 pip from the upper resistance zone to the current price and it could get even more. Please do not think that I can make such precise forecasts every week, but this week was very easy as there were very big big players in the market who had been collecting massive shares of Bid for two weeks. Of course, my specially filtered limit orders only work in markets where big big players are active. And that was definitely a home game this week.

Now we come back to the press release. Fed decision to drive the dollar. Many market participants believe that this statement by the FED has resulted in the course falling sharply. The real reason, however, is much more mundane. Already on June 3rd and 4th I noticed that the big players collected massive bids almost at the low. In the following week, the price was then massively pushed up and a new high formed again and again. As a result, more and more long traders came into the market. On Friday last week, the price was finally pushed down sharply. On Monday through Wednesday of this week, the price was slowly pushed up again and, interestingly, it was precisely in this area that massive bids were collected again. And now we should all ask ourselves the following questions, if the world's largest big players collect massive bids at one price level over several weeks, where will the price head in the long term? In addition, we still knew that the FED meeting could cause high volatility.

We all know the phrase, which came first, the chicken or the egg? With its announcement, the FED was not to blame for the fact that the price had gone down, but the big players who had already collected bids weeks in advance at a price level. The big players certainly had more information about what the Fed had to announce that day. So the big players have already been preparing for two weeks because they knew that there would be very high volatility on that day. It is therefore clear that you can already know exactly in which direction it is going before an outbreak occurs. This should be of particular interest to traders who specialize in these breakouts. Incidentally, I did not participate in this outbreak, for me it is crucial which direction the medium-term course takes. From this I use my key candles to create the zones where I try to achieve a pip value greater than 2 per minute. With this I am able to trade 10-20 trades a day cleanly. Such extreme breakouts are quite rare, I prefer to rely on regular reliable trades.

We come to the conclusion:

The success of a trader is not based on the fact that he can trade such extreme breakouts exactly, but completes regular, small trades with a high profit rate and a good CRV. To do this, however, you have to know which medium-term movement a course is currently taking or whether it is even in an equilibrium. My special filtered limit orders in combination with my Bionic candle give me a good future overview of the price trend. For the entry and exit of my trades, I then need the identification of the algorithms with my tones. Without this help, I could never achieve such a high win rate. For this reason I can recommend each of you to take a closer look at the exchange data from the futures market. I wish you a really great weekend and if you like the channel I would be happy to receive a subscription.

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Kind regards Michael

Excellent post as always, Michael. Looking forward to giving the video a good deep dive!

Have a grand weekend and on to next week's fun