The Equilibrium, a key to success!

Read charts correctly




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 traders spend their lives searching for the holy grail. You dream of recognizing every turning point in advance as possible in order to earn a lot of money with it. In today's post we talk about how a trader is able to read the charts correctly over the long term. An important topic here are the price gaps that we encounter again and again in the chart. With the stock market wisdom that 90% of all price gaps are closed again, traders often get involved in daring trade executions. In today's post we look at the largest gap in EURUSD that has emerged in the last ten years and how traders have reacted to it. At the end we look at an outbreak and how you can clearly identify it beforehand.

In the last 30 years a total of six large price gaps of more than 180 pips have arisen, the last big price gap was in April 2017. Here we see the chart image in the daily chart before the price gap upwards arose. From the trader's point of view, the price was in a downward movement. If we zoom in closer, we notice an extreme downward course, that was the result of the election night between Hillary Clinton and Donald Trump. Many traders have drawn a resistance zone there and when the price got into the zone it was turned down again. The further trend looked just as bearish at first glance. We all know only too well what happened after that. Between April 21 and April 24, 2017, there was a gap of 180 pips. On April 21, the price closed at 1.07220 and opened at around 1.09 on April 24 at 12:00 AM. This means that the market orders were placed on April 21, 2017 shortly before the close. Had that not been the case, the price would have opened at 1.07220 on April 24 and would then have risen sharply. As we know, however, there was a gap in the course. This means that on April 21, shortly before the close, a large number of market buy orders came into the market and at the same time the liquidity of the limit sell orders was very low.

Since the exchange stopped and the market orders were already in the market, the resulting strong upward movement could no longer be executed. If the market had been open for 1 minute longer, the situation would have been as follows. In principle, this price gap can thus be described as a large, strong candle that was triggered by low liquidity in the area of limit orders and, at the same time, a high volume in the area of market orders. After the price gap arose in April 2017, the price went up to 1.255. In total, it took almost three years until the gap was finally closed again. Whether in the end the gap was actually responsible for the fact that the price went down over two and a half years to close it is pure speculation.

What is interesting, however, is the way in which this gap was closed and we will now take a closer look at that. Before the gap was closed completely, the price had already entered the gap twice. We first consider the situation with the yellow arrow. In the second contact phase, I once drew in the Pip values in 4 hours in the H4. You can find some videos about the pip value per minute on my channel. The findings from the yellow square are the most interesting, so let's take a closer look. The higher the value in 4 hours, the stronger the movement up or down. As we can see, the course is in equilibrium here. The big players recognize from this how many long and short traders are in the market at the time. When a price is pushed up, the short traders are stopped and at the same time, with their triggered stops, help drive the market up. When the big players pushed the price up to 438, it was clear that there was a massive number of short traders in the market. Now the market has been pushed down again to motivate more short traders and to stop the long traders. After that, the market slowly went up. Let's look at the situation again with my specially filtered limit orders.

We can see that massive bids were collected in the limit sell orders from February 13th to 17th. From my point of view, the big players actually planned to close the Gap. We also note that on February 18th and 19th, bids continued to be collected even at the low price. On February 20th, the big players realized that the majority of traders had taken a short position because they all expected that the gap would now be closed. The big players take advantage of the situation and now again sold their short position to the willing short traders. Then on February 21st, you push the price up sharply with the help of the short trader's stops. At the high they started collecting ask and after that the price went up a total of 700 pips.

Now the question arises why the course went beyond the gap. To answer this question we have to go back to April 2017 to find the corresponding key candle. We zoom in a little, stay in the daily chart and notice three blue candles that signal a strong downward movement. We draw a zone in this strong downward movement and see which candle breaks through this zone. This is exactly our key candle that will help us plan the next long trade at a later date. Of course you can refine the zone up to the M1 a bit. You can also find information about this on my channel.

We do the same for the second blue candle. We identify the key candle and draw the appropriate zone. Now we come to the third and decisive zone. Interestingly, this key candle was actually the strongest. We now draw this zone and now go into the future. The course went up to 1.25 and then took two and a half years to get exactly into the zone. After that, the price went up from 1.07 to 1.23. Perhaps that should also be a good reason for you in the future to take a closer look at the key candles.

Half a year later the election was in America. On the morning of November 4th, 2020, I carried out a detailed analysis of the election night and published the following post on my blog at Forex Factory. An exciting election night is behind us and at this point in time the winner has not yet been determined. If you compare the price development in November 2016 with the price development last night, from the trader's point of view it looks as if Biden could win the election. We will see which candidate the voters have chosen. In addition to the exciting question of who will win the election, the course in the euro US dollar was much more decisive for me. All in all, it took a few weeks, until it was actually clear that Biden had won the election so easily. Interestingly, the market already knew that beforehand.

Finally, let's take a look at the outbreak on Wednesday July 28th. First turn your attention to the existing limit orders. There were around 600 limit buy and 600 limit sell orders in the DoM. The big players had collected massive requests in advance and you could see from the stops that the majority of traders were long-oriented. In this respect, the Fed conference was a good opportunity to get these unpleasant long traders out of the market. I also initially expected a somewhat stronger short movement. We look again at the limit orders, which are now around 400 lots on each side. The big players are currently massively withdrawing their limit orders, which speaks for a future breakout. In the middle you can see a bigger box. On the left side we see the strength of the limit buy orders, on the right side the strength of the limit sell orders. And now pay close attention to how suddenly the strength of the limit orders diminishes massively. That's exactly when the outbreak begins. We know exactly that when there is no liquidity in the market, few market orders are able to move the price massively. The big players have used this downward breakout to collect additional Ask at a lower price level. After that, the price was pushed up again and continued to move up over the next few days.
With the help of this information, it is often possible to precisely identify the turning point, even in the smallest units of time. However, you have to be prepared to invest in the appropriate technology and training. In my videos you will find many examples that may motivate you to study the algorithms in more detail in the future. In the next few weeks I have some projects on the program where we will penetrate the market even deeper with very professional programmers. I'll go into that in more detail in my next videos.



First of all, I wish you a nice weekend and continued success in retail.

Kind regards Michael

Vanities versus constructive feedback

Hello Paul,

First of all, thank you very much for your feedback and the effort you made. You are right, the title could have been called differently, but since the gaps are part of the chart technique, I decided on the corresponding title. You can get annoyed about a little thing now, or use the other good tips to get forward with it. The information that I share on Youtube and FF is voluntary and free of charge. Remember, there is no right of exchange for a free gift.

Based on what you write about the gaps, you can tell that you haven't really dealt with them yet. From my point of view, that could help you in the long term.
If you had read my entire blog from start to finish, you would know that I started this blog for myself as a trader's diary and not to teach others how to trade. There are trading coaches and blogs who specialize in finding students to earn money with. My boring statistics help me to understand many previously unknown things in depth. And that is exactly what is important to me for my personal development. Many of my subscribers see it the same way.

What annoys me about your words. You write people want to know how to make money and not how a gap was filled. What amazes me is that, despite my boring statistics, over 260 great traders and people follow me on this blog. You also have a blog that's even older than mine. Why don't you put the things you recommend to me first into your blog? That doesn't fit into the picture for me.



By the way, precisely the attitude: “Trading has to be easy” it is the reason, why so many traders lose. Anyone who takes a closer look at the algorithms of the big players knows that the market is highly complex. Incidentally, I have repeatedly written in my blog that I am not so arrogant to believe that I am always right. The information that I provide here for free is a buffet, everyone takes what they want. If a trader can't find anything in my voluntarily provided buffet, there are many more great buffets at FF. But I don't want to waste time with unnecessary discussions about which trader is right or not. I have been living in this business for over 12 years, but only because I am involved in this job 12-14 hours a day.

Here is an article on constructive feedback that I think might help you.

https://www.forexfactory.com/thread/...8#post13519708

Since I have the feeling that my posts annoy you more than they help you, I would like to help you avoid having to read this blog in the future. This will allow you to concentrate more on your own blog and making money in the future.

I wish you from the bottom of my heart that your family will soon be healthy again and for you personally that you will achieve your goals in the future.

Kind regards Michael

The SWOT analysis



Hello dear subscribers


In today's post, we're starting a new series of interesting information that so far many traders have neglected. The background: We traders often focus on systems, setups, algorithms or strategies without thinking about ourselves first. Success is often so close to us, but we don't see the forest for the trees. That is why we doggedly concentrate on things that actually do not get us any further. Not the volume or a new indicator ensure our breakthrough, but only the knowledge about ourselves. So we are daily in search of the holy grail, without knowing that it is right in front of our noses. In the frenzy of defeating the market, we forget the crucial point, who we are ourselves. Our success lies between our two ears, deep in our brains. And it is precisely this brain that we pay too little attention to and we forget to analyze ourselves in the process.

On YouTube we find a lot of information in the area of trading opportunities. This includes indicators, strategies, setups, certain procedures and equally interesting ways of thinking. In addition, we find numerous descriptions on the market of how we can minimize our risk with the help of money management or different strategies. In order to increase our chances and at the same time reduce our risk, we sometimes have to pay a lot of money if we take the help of some self-appointed coaches. What is often forgotten are the individual strengths that every trader brings and of course the associated weaknesses. First of all, let's refer to the opportunities and risks that we encounter in the market as hardware. In this case, our strengths and weaknesses are the software. I believe that it is clear to everyone that the best computer in the world is of no use to them if the corresponding software that they use does not run on this computer.

How do I want to take advantage of opportunities when I am not at all clear about my strengths and how should I avoid risks in the future if I am not aware of my weaknesses. In order to be successful as an entrepreneur, I first need a so-called SWOT analysis. This SWOT analysis is about the consideration of strengths and weaknesses as well as opportunities and risks of a company. With this analysis, the current state of a company can be recorded in order to initiate suitable strategic optimization measures.

With the internal analysis, the actual condition of the trader is described by first listing and analyzing the strengths and weaknesses. With the external analysis, the actual state of the stock market is determined, in which the possible opportunities and risks are listed and evaluated. The external analysis is also known as an environment analysis or market analysis. The first goal is now to expand the market opportunities with the help of my strengths. Which of my strengths are suitable for this and which are not? How can my strengths increase the chances of realization? The second goal is now to reduce my weaknesses so that my market opportunities do not deteriorate in the future. For example, how can weaknesses develop into strengths or where can opportunities arise from weaknesses? The third goal is: which risks can I counter with which strengths and how can I use my strengths to prevent certain risks. Finally, we ask ourselves the question: where do weaknesses meet risks and which activities should be avoided?

First of all, we know that most traders are aware of the opportunities and risks in the market. But very few actually know their internal strengths and weaknesses. Now comes the crucial question: how do I want to be able to take advantage of specific opportunities and risks if I am not clear about my own strengths and weaknesses? It's just as crazy as the phrase how should I know what I'm thinking before I hear what I'm saying? I know where I want to go, but I don't know what measures to take to get there. That means, until I do not really know what strengths and weaknesses I myself have, I am not able to react accordingly to this very complicated stock market. But thankfully there is YouTube and crazy people like me who might have a solution for it.

As I mentioned in some of my videos, 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. 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. And there are already big differences here. Let's imagine that a swing trader is a truck racing driver, a day trader a rally driver and a scalper a Formula 1 driver. Now, the truck racing driver gets into the rally vehicle and the rally driver into the Formula 1 car. The drivers will certainly be able to drive the respective vehicle, but would not have a realistic chance against the competition.

That means every trader is as individual as a thumbprint and that is exactly why one would have to deal with each trader individually. Unfortunately, many trading coaches forget that. Learning to trade is not comparable to a dance class, it is about a lot of money in the long term and possibly also enormous losses. That is why it is not enough just to ask what knowledge a future student has. Incidentally, this is also the reason why I can only recommend everyone to stay away from a trading coach and look for a mentor instead. You can find information about this in my videos.

Introverts focus more attention and energy on their inner workings. In groups they tend to observe more passively, than to act and are often described as quiet, reserved and calm. However, introversion is not to be equated with shyness. Extraverts are characterized by an outward-facing attitude. Extroverted characters find the exchange and action within social groups stimulating. You are talkative, determined, active, energetic, dominant, enthusiastic and adventurous fun. The task-oriented person experiences himself coherently and essentially through the orientation towards a topic or a task of interest to him. He feels in harmony with himself when he is enthusiastic about a cause, penetrates a topic or can master a task. Friendships result from a common factual orientation. The people-oriented type is essentially defined by his direct relationships with other people. He is in tune with himself and feels valuable when his relationships are right. Before working with another person, the relationship level must first be clarified.

What strengths and weaknesses the synthetic trader, the pragmatic, the experimental and the reflective trader have, we will take a closer look at in my next post. I will also show you a way to find out which of these traders you belong to in order to create a strengths and weaknesses profile. This could possibly support you more in your capacity as a trader in the future. The banknotes that a customer receives in four different banks are the same, what makes the difference are the cashiers. And that's exactly what we're going to take a closer look at next week.



I wish you a relaxing weekend, for some a great rest of vacation and for the others a lot of success next week in stores.

Kind regards Michael

What type of trader are you?



Hello dear subscribers,


Today's post was very laborious to create, because I translated the most important content from my video into English again especially for you. Since there are different terms for certain words, there may be errors or inconsistencies in my translation. I ask for your understanding, although I have tried very hard. Unfortunately, I was only able to translate the 10 most important slides. If you want to create this trader analysis optimally, I ask you to proceed as follows. Read my English text first and then watch the video. There you can see exactly how to proceed with the analysis. Then you can answer the questions and make your evaluation. I wish you alot of fun.

Over 90% of all traders lose long-term on the stock exchange and this is not only due to the sophisticated strategies of the big players. Today we will deal with the points that a trader can influence and change himself in order to reach his breakeven point. In some of my posts I have already mentioned that there are basically four different types of traders who of course achieve their goals individually. There are pragmatic, experimental, reflective and synthetic traders who have different characteristics. In today's post we will find out which category you belong to and of course uncover the associated strengths and weaknesses. This then results in possible solutions that can have very positive effects in the future. The point is not to put the four different types of traders in one drawer, because every trader naturally has different strengths and weaknesses that cannot be compared with one another. This then results in innumerable possibilities.

Each of you work in different markets and assets and there are different opportunities and risks. Anyone who knows their strengths and weaknesses exactly can use their strengths to expand the opportunities in the respective assets and at the same time hedge against possible risks. Those who know their weaknesses and reduce them to a minimum can increase their chances. An awareness of weaknesses also helps to avoid possible risks. The key here is to recognize your own strengths and weaknesses. Whoever knows others is taught, whoever knows himself is wise. Of course, every trader knows his own strengths and weaknesses, the challenge often lies in the small details that are easily overlooked. A small screw that is not tightened can cause a large airplane to crash. And for this very reason it is important to pay attention to even the smallest screw. And that is what we will deal with intensively today.

Today's trader analysis, which we create together, can only give you a rough insight into your strengths and weaknesses. If you would like to deal more deeply with this topic afterwards, I recommend dealing more with the "Biostructural Analysis" or "Insights MDI". 20 years ago, as part of my training, I acquired the trainer licenses for the "Biostructural Analysis" and “Insights” and worked with them for many years. The seminars offered on the market are not cheap, but give a deep and efficient insight into different behavioral patterns.

Let's start with the analysis first. You get 40 different statements from which you choose 10 statements that best apply to you. In order to make the analysis as objective as possible, I recommend that you answer the questions together with a partner who is close to you. I would like to briefly show you why this makes sense with the first question. It says here: When this person speaks, they appear: Confident, loud, behavioral or unemotional. Now one could use the word “loud, cautious or without emotion as negative and for this very reason would tick the box next to "Confident". That could in the end falsify the evaluation. By the way, a person who speaks a little louder will probably be surprised if this is reflected to him because he may not be aware of it. Therefore, get support from a person who knows you well.



Here you can now see all 40 questions. A maximum of one point or a cross may be placed per question. If you are not entirely sure, it often helps to rule out the things that do not apply to you. If even two things are true, choose the answer that applies to you more often. When you have answered the questions, add up the points, they show you how strong you are in the pragmatic, experimental, reflective or synthetic area. I have now come up with a fictitious trader and filled out the analysis for him. This fictitious trader scores five points in the pragmatic range, one point in the experimental range, three points in the reflective range and one point in the synthetic range. Most of the points show its main potential, the second most points support the main potential and the fewest points show the weaknesses. This means that our fictitious trader has the greatest strength in the pragmatic area, is supported by the reflective area, while the experimental and synthetic area shows its weaknesses. Let's look at some basics first.

The synthetic and reflective trader is more introverted, while the pragmatic, experimental trader is extroverted. The synthetic and pragmatic trader is task-oriented, the reflective and experimental trader is more people-oriented. In our crosshairs, the fictitious trader with his greatest strength is in the upper right area and the support in the lower left area. At 10% each, the weaknesses are in the synthetic and experimental areas. Another important point is the differences in perception. A synthetic trader is often perceived as stiff, suspicious, cold, reserved, and indecisive. But from his point of view it looks very different. He feels himself to be cautious, precise, level-headed, questioning or formal. And that is exactly the difference between self-image and external image. Another aspect is our behavior in different areas of life. Each of us plays different roles in different situations. We behave differently at work than when we celebrate with friends. When we are sick or experience strokes of fate, we behave differently than on vacation, although we are actually always the same person. A synthetic person shows few emotions on the outside and is calm on the inside. This is certainly true when he meets a stranger, but in a safe environment like work, the situation can change. With friends or family, stronger emotions can arise. This means that our properties can change and vary depending on the situation.

Now some will ask themselves which color scheme is the best for becoming a successful trader. Now the circle has a total of 360 ° and it contains four colors. Each color can reach a maximum of 360 ° and thus a particularly high strength. Four colors each occupy 90 °. If the four colors are evenly distributed, there are no major weaknesses, but also no major strengths. The best combination is therefore ten points. Now each of you will say, well, everyone gets ten points. Exactly, that's why it doesn't matter what the color distribution looks like for success. It is crucial that you know your strengths and weaknesses and apply them accordingly to the market. In addition, you only create your personal analysis here and do not compare yourself with other participants. That would also make no sense, since every person has individual abilities that cannot be copied. In our crosshairs we first created the four different traders, let's now look at further properties.

The synthetic trader refers to facts and is able to see details. The pragmatic one also uses facts, but has an overview of the whole. The experimental trader overlooks the whole, referring to his own theses, while the reflective trader looks at his theses in detail. We see that both the synthetic and the reflective trader are able to analyze the details, while the pragmatic and experimental traders see the whole. The synthetic and pragmatic achieves success through thinking, while the reflective and experimental relies on intuition. This results in different synergies within our crosshairs. The synthetic trader is calm on the inside and shows little emotion on the outside. The pragmatic trader agrees, but is stressed inside. In addition to internal stress, the experimental shows strong emotions, while the reflective trader is internally balanced in addition to external, strong emotions. The synthetic one is precise while waiting. The pragmatic, precise and goal-oriented. The experimental is practical and goal-oriented and the reflective wait-and-see and practical.

Although most traders are active in the day trading arena, there is a very high number of swing traders in the synthetic and reflective trader arena. Likewise, most scalpers can be found in the field of pragmatic and experimental traders. The synthetic and pragmatic prefer to work alone, while the reflective experimental like to work in groups. Most fear traders are among the synthetic and reflective traders, while the greed traders are mainly found in the pragmatic and experimental realms. Please note, however, that there are also different levels here. Not only is water cold or hot, it can also be lukewarm.



Now let's get to the main aspects of the synthetic trader. He belongs to the group of fear and fact traders, analyzes details, trades calmly with little emotion.



The pragmatic trader seeks variety, acts according to guidelines, makes independent decisions, uses an exact, precise way of working, while the planning work is very imprecise.



The experimental trader belongs to the group of greed and intuition traders, analyzes the whole thing and acts with strong emotions in times of stress.



The reflective trader acts cautiously and as a security and rational trader, acts problem-oriented, but has good money management. For the four different traders I would like to give you additional behavioral tendencies and limitations so that you can get even more detailed information.



The synthetic trader, planning ahead, systematically accurate and logical. On the left side you will find the behavioral tendencies, on the right side the limitations.



The pragmatic trader is dominant, challenging, direct and determined



The experimental trader captivating, innovative, positive and spontaneous



The reflective trader is supportive, helpful, focused on security and stability.


Let us now consider the evaluation of such an analysis using our fictitious trader. His strength is 50% in the pragmatic area, so I look at the basics of the pragmatic trader. In addition, the behavioral tendencies and their limitations. The same thing now happens in the reflective area, whereby I also look here at the behavioral tendencies with the limitations. Please note that the strength is only 30% here. Therefore, the effects are not quite as strong here. In the experimental and synthetic areas, my fictional trader's strengths are very weak. He can also see the behavioral tendencies to see what is missing.

Let's go back to our crosshairs for a moment. Here we see the effects if a pragmatic trader scored ten points. That would be a strong expression. A medium score with five points and a weak score with one point. The same is of course also true in the other areas. Now we draw the result of our fictitious trader in our crosshairs. The main potential lies in the pragmatic area, the support in the reflective area, and the weaknesses in the synthetic, experimental area. If one were to form an average of this, the result would still be in the pragmatic range. This example should make it easier for you to create your own analysis.



Here you will find a small overview so that you can assess other people more quickly and communicate better with them in the future.

Our fictitious trader has now created his strengths and weaknesses through the analysis. Here we can now put a tick behind it. The goal is now to use these strengths and weaknesses in order to increase the future opportunities and at the same time minimize the risks. And that is the greatest challenge because many do not even know how to achieve this goal. If you master the challenge, then the implementation takes place in order to realize and control the goal. This is exactly what I criticize most trading coaches about. They try to shape you as they are themselves. Never try to shape someone for who you are. Know that one of your kind will do. A tomcat that has eaten a canary cannot sing. And a student who has taken a volume trading course is far from being able to trade profitably.

Let's take a look at how we humans deal with problems. On our journey we have a flat tire, we forgot our cell phone and there is no traffic on the road that can help us. Our solution is in the trunk, a complete flat tire set. We use that and a short time later we can continue our journey to the next tire dealer . It's not that easy in trading. Let's imagine a trader is afraid to trade. Now someone tell him that volume trading is the solution because he can always see what is happening. He tackles the matter with renewed courage and realizes that he is not getting anywhere either. First of all, we should ask ourselves what this trader is actually afraid of. The following situation could be the reason for this. This trader has saved 10,000 euros in order to build his way to becoming a full-time trader in the long term. He has now traded a few times and has already lost € 2,000 in the process. He knows that if he has lost the money, the dream of the self-employed trader is over. Because of this, he is afraid of entering into more trades.

Now imagine we could show him a solution, how he could reach break even with 6000 trades and not lose more than € 200. I am convinced, that with a clear strategy one can take away his fear and he actually achieve his goal. And do you know how it actually works in reality? A synthetic trading student comes to an experimental trading coach. As you can see, the strengths and weaknesses are completely contrary to each other and yet the trading coach tries to impose his system on the student. The student thinks: Well the trading coach is outwardly, very successful then he must be right. If the synthetic trading student tries to be successful in the experimental area, you can quickly imagine how this game will turn out. And for this very reason, I recommend that you rely on a mentor who will accompany you for a few years. A trading coach is task-oriented, short-term and performance-oriented, while mentoring is relationship-oriented, long-term and development-oriented. About this, you can find some videos on my channel.



First, take a little time to analyze your strengths and weaknesses. In order to match these strengths and weaknesses to the risks and opportunities that you encounter every day in the market, look for a suitable mentor who will support you for a few years. I know that finding the right mentor is not an easy task, but at the end of the journey, success will prove you to be right. I would be happy if I could help you a little with my contribution today, I wish you all success and I keep my fingers crossed for the future.


Kind regards Michael

Concrete chances against big players

Attached Image

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 two videos I showed you how to analyze your strengths and weaknesses in order to increase your chances and minimize the risks. Today we want to compare the strengths and weaknesses of the big players with the retail traders and work out where our greatest opportunities lie. As always, it is my personal opinion, which of course can be very different from other traders. Many traders assume that the big players have formed a secret consortium, coordinate, work together and manipulate prices. However, I see these statements in a somewhat differentiated manner. Of course, the forex market and the stock market are not a game, there is a real war here, which the big players decide in their favor with their superior weapons. The biggest big players don't have to work together because they use similar approaches and therefore see exactly what their competitors are doing. They are more likely to fight against the institutional and retail traders that are losing the most money in the market. We retailers are the largest in terms of the number of traders, but we also suffer the highest losses. To take advantage of our best opportunities, we must first understand how the big players differ from the retail traders.

First of all, the 100 biggest big players who work in Forex EURUSD have enormous capital with which they can move the market. Often this is borrowed capital that usually comes from their customers. The retailer, on the other hand, works with equity that can be multiplied again through the leverage of the broker. The biggest big players in the world work without stops and are even able to push their previously collected orders into the red at short notice without getting into trouble. Most retail traders use stops that the big players need to fill their limit orders. By the way, virtual stops are an interesting alternative for retail trailers to protect themselves from brokers. The big players use iceberg orders on the limit side in order to be able to enter and exit the market unnoticed. Retail traders mainly use market orders to enter the market. Market orders are easier to identify than iceberg orders.

The largest big players in the world use highly complex algorithms that coordinate the collaboration between their limit and market orders. These algorithms are programmed to deal with the misjudgments made by retailers, who often rely on indicators. The big players have to be seen as a kind of army that operate according to clearly defined strategies, while the retailer is left to himself and pursues his own strategies. The big players are not able to get 100,000 lots at the push of a button, so they are forced to collect in an accumulation or distribution phase. These collecting phases can last several days, while the retail trader can get in and out immediately. The big players have a direct exchange or Forex connection, while the retail trader may have several brokers in between. There are significant differences in the speed at which orders are executed. The biggest big players in the world work with a very professional team consisting of analysts, programmers and traders, while the retail trader has to do everything on his own.

Due to the collection campaigns, a large team and clear strategies, the big players are not able to react as quickly as the individual retail trader. Thanks to modern technology such as microwaves, the big players are able to execute massive orders within milliseconds. The retail trader is limited by his internet provider and the latency of his broker. Most retail traders trade on the stock exchange on the side, while the big players work full-time almost around the clock. This also explains the enormous differences in the area of profit opportunities. In certain situations the big players are at risk of generating massive losses. These losses are doubly tragic because it is their customers' money. Due to the legal regulations, a retail trader can lose a maximum of his account balance. The big players work with very high-quality technology in the area of their computers and servers, while many private traders trade with their cell phones or laptops. The big players move the market while the retail trader can only let himself be dragged along. Therefore, a misjudgment often costs more money than if you can move the market.

The big players trade in the Forex market with very low costs, which a retail trader can only dream of. Since we often have several brokers in between, we incur significantly higher costs. However, due to different constellations, the big players take a significantly higher risk than a retail trader. On average, the largest 100 big players trade a trading volume of 166,000 lots per day, in contrast to the retail trader who only trades one lot. The big players use the forex market to carry out a currency exchange or various hedges for their customers. You earn high commissions from this without having to take any risks. The largest number of retail traders use this market almost exclusively to make a profit. The 100 largest big players have specific volume information in the forex market that they even sell to institutional traders. In contrast, a retail trader does not receive any of this information. In my opinion, the biggest big players in the forex market even have an emulated DoM, built from the existing volume and their own information. This deep market insight is not possible for a private trader.

It is also interesting that the big players know exactly how retail traders work, while retail traders do not know how the big players work. The biggest big players work in their own market every day while we are guests in their market. This creates the effect of the home game. The hard skills of the big players, i.e. the technology, the servers and the Internet, are over 30 years old and have grown over time. A retail trader is forced to develop these hard skills first. The same applies to different strategies that have been improved and optimized over the years. Your hardware was built by professionals and is serviced and optimized daily, while a retail trader has to take care of it himself. Over the years, the big players have developed optimal trading software, while the retail trader has to access third-party software. The biggest big players clearly control the markets, which is comparable to a giant ship on the ocean, while the retailer sits unprotected in a small nutshell. Over 1 million retail traders exchange information with each other in various forums every day and reveal very interesting information, while the big players remain silent.

Let us first compare the statements made by the big players with the retail trader and rate them as strength or weakness. In summary, we can see that the strengths of the big players roughly correspond to the weaknesses of the retail traders. Here we can already see the clear dominance of the big players. Let us now consider the clear advantages of retail traders. We know that the big players work with outside capital and outside capital is never as efficient as own capital, since interest has to be paid on outside capital. In principle, this is an advantage, but initially it does not help us in direct trading. The big players are forced to build up their positions for hours or days, while the retail traders can get in or out immediately. This point is definitely an advantage for us. Due to different constellations, the big players are only able to react slowly, while we retailers have a clear advantage here in the area of speed. Of course, the big players can make massive losses and thus have a significantly higher risk than a retail trader, but the big players don't seem to care. In this respect, these points do not bring us any particular advantage in retail.

From my point of view, there are two clear advantages on our part. We can get in and out at any time and don't have to build and defend positions for hours or days. Another advantage is that we can react very quickly in order to quickly buy positions or to exit positions. Another important point is the fact that we retail traders are able to read out the algorithms of the big players with specially filtered software. In many of my videos, I have already shown you how to identify the algorithms of the big players in order to achieve trading advantages. We know that there are no patterns in price, candles, or indicators. However, there are clear patterns in the algorithms. Algorithms are orders in order to coordinate limit orders, iceberg orders or market orders with one another. These are programs that are always called up and therefore have clear patterns.

We have selected our only three chances: We can get on and off at any time, are able to react quickly and can read the algorithms of the big players. Now we come to the exciting question of how can we use these opportunities to our advantage? Well the answer lies in the word quick. If we can react quickly, but do not implement this in our actions, our advantage is wasted. This is one of the reasons why I specialize in scalping, for example. With the help of my Bionic candle in the tick chart, I get a clear overview of the course through the identification of the key candles. As soon as one of these key candles is activated, the algorithms that are read from stock market data help me to make the right decision.

Then everything goes very quickly, the entry into the market, from then on my pip value runs per minute, which informs me about the current risk. My tones help me to determine the algorithms more quickly, which then help me to exit. As we know, the high-frequency traders are clearly superior to the big players with a win rate of 99%. Of course, I cannot compare my seconds scalping with a high frequency trader, as the special technique is not available to me. It's not about getting better odds than the big players, but rather about getting better odds than the average trader. And whoever manages that already has a considerable market advantage. The sentence: It is not the big ones who eat the small ones, but the fast ones the slow ones, is given a special meaning. You will find specific information and ideas in my numerous videos.

Let's get to the summary:

Out of almost 30 points, there are only three points where we are superior to the big players. The entry and exit, the speed and the reading of your algorithms. If you manage to use these three opportunities to your advantage, you can significantly improve your chances of winning and at the same time reduce the risk. Virtu is the largest high frequency trader in the world, and analysts have found that their approach is almost risk-free. For this reason, a small stop of 1.5 pip, a TP of 3 pip within 1-2 minutes is also a comparably low risk for me. With this approach you can still trade very well even in calm market conditions, I have already talked about this in numerous videos.



I would be happy if you could develop some ideas for yourself from this, keep your fingers crossed for the future and look forward to hearing from you again soon.

Kind regards Michael

Something I would like to point to here, based on my own career and experience, in line with what you are saying Michael .....

The big participants are entities or as some people call them, companies, corporations or organizations. Whichever label you give them, they are public, they are present and they are constantly involved as they have to be...it's part of their working model. As much as I know people are addicted to and so heavily reliant on data and technology these days, I am seeing a deep lapse in people's understanding of the real world. Real people, real companies and real activity. The absence of people's awareness of business and the business world, has generated a slippery funnel that cascades most people into the cul-de-sac you are speaking of re: their strengths and weaknesses vs ours.

From my experience the need for the 'us vs them' war need not even be an issue. But this is from a mindset of someone who has treated all these "big things" as just another participant, with only one exception... they leave paper trails and detailed information that proves to be very useful if they are treated the same as if you were to pick an investment vehicle - you must do a top down- bottom up evaluation of what they are and what they're capable of, where their weaknesses are and how to use them against their own hierarchy's projected plans. I have mentioned this before elsewhere and people thought me batty, but really, all these 'big players' sit beneath the main table of management. We know this to be so - BIS and central banks are great egs of this. If this is not factual and consistently true then why do these entities even exist at all and why do they interrupt/interact and why do governments and others answer to them. These are queries people must ask themselves. People are ignorant not because of technological displacement but because they 'believe' virtual over real life. This has been my experience and consistent and ongoing observations.

This is not to impose on your thread Michael, it is something that I see everywhere now and needs to be mentioned. People 'believing data or digital' before checking reality is very unhealthy. And why? All because they are not willing to do their homework to learn about the underbelly of what they call the "markets".

From my experience, at some point, physical must meet with digital, otherwise a person's knowledge is lopsided and is covered up with justifications such as - "I do this to make money" or "I don't care how it works only that it works".

Anyway just my input. Also to add, I do enjoy your inputs here on this thread. It's great to dance a jig when mediocrity takes a backseat for a more mature and intelligent involvement.

So well done and thank you.

The big players' iceberg orders



Hello dear traders,


I have produced a new video on YouTube on the subject of Icebergorders, which can also be uploaded with English subtitles. However, as always, you will first receive my English translation. Since the number of pictures at FF is limited, please watch the video after reading the text. You can find the link from the video at the end of my post.

In today's post we will take a closer look at the iceberg orders. What is the difference between native and synthetic iceberg jobs, where and when are they used? We create a profitability analysis of iceberg orders compared to normal limit and market orders and look at some examples where iceberg orders are increasingly used. The distribution of iceberg orders based on the total volume is also interesting. As always, my contributions are only about my personal opinion or experience. The measures available to traders have not changed significantly for centuries and probably millennia since the first type of trading venues were established. The speed with which certain orders are delivered to the exchange, how the exchanges process them and give appropriate feedback has changed significantly. Also, the market data has changed significantly, mainly due to the improved technology and bandwidth. Market data today enables much greater market transparency.

If a big player wants to push the course down, he has to collect the dollar first. He can achieve this with limit sell or market sell orders. Then he has to get out of his position and sell the dollar with it. For this he uses either limit buy or market buy orders. Before he pushes a rate up, he has to collect the euro. This is done with the help of limit buy or market buy orders. To realize his profit he has to sell the euro on the high. To do this, he uses limit sell orders or market sell orders. Now you must have noticed something. With a limit buy or market buy order, the big player is able to buy the euro or sell the dollar. With a limit sell or market sell order, the big player is able to buy the dollar or sell the euro. If the euro is bought, the rate will go up over the long term. If the dollar is bought, the price will go down in the long run. If the dollar is sold, the situation is unclear because we do not know whether the big player has only made a partial sale or is already out of his position. In the event of a partial sale, the price would continue to rise. If the big player is out of his position, an equilibrium would have to arise again, where a new player collects. The same applies, of course, if the euro is sold. For this reason I have concentrated on specially filtered limit orders that show me exactly what is currently being collected. In the equilibrium we see that bid was primarily collected. First the shortraders are taken out, then the course goes down. In the equilibrium we can see that the euro has been collected more strongly. We see the resulting result on the chart. For these individual actions, the big players use iceberg orders, which we will now take a closer look at.

Due to the high demand, most exchanges offer traders who trade large quantities the opportunity to place iceberg orders in the market. Big players want to hide their orders because orders generally reflect the intentions of their owners. Great traders are considered to be more informed and influential than the average trader. If the intention of a large trader becomes transparent to other market participants, it would make it difficult to execute at the desired price. The iceberg order is used to reduce the risk of a strong price movement while hiding the future strategy. This is a limit order in which only a fraction of the total order volume is displayed in the order book. The rest of the volume remains hidden. Only when the still dormant (outstanding) peak is executed will the next hidden part of the iceberg volume be revealed. This process is repeated until the original order is fully traded or canceled. However, this also means that an iceberg order is only effective at one price level. Iceberg orders are nothing more than limit orders that are controlled by algorithms and absorb market orders at certain price levels. We should know, however, that absorption does not only take place at one price level, but always at several.

In the DoM we see on the right side the red limit sell orders which absorb the market buy orders and on the left side the green limit buy orders which absorb the market sell orders. Behind the limit orders are the tranches of the iceberg orders, which are not visible to a market participant and which gradually advance. Let's imagine an iceberg, the visible orders in the DoM are the small iceberg that is visible to us above the surface of the water. The greater part that is hidden from us lies beneath the surface of the water. As soon as the first tranche of the iceberg order has been cleared by the market orders, the next tranche of the iceberg order slips until it has been fully traded or deleted.

The CME only supports two types of iceberg orders: native and synthetic. Native Iceberg orders are managed by the exchange itself. All new tranches are treated as changes to the first order, so the original order number or order ID is retained for the entire duration of the iceberg order. Synthetic iceberg orders are submitted by independent software providers whose infrastructure is physically separated from the exchange. These software vendors split the original iceberg order, submit new tranches, and track their execution. These tranches cannot be distinguished from the usual limit orders of other participants. Identifying native iceberg orders is much easier because the order number doesn't change until the iceberg order has been fully processed. The big players work almost exclusively with synthetic iceberg orders that generate different IDs, which makes identification considerably more difficult.

Let us now consider an example of a flow of native iceberg orders in the Limit Buy area. Just like customers at a supermarket checkout, the limit orders also have to line up. The 8 lots on the Limit Buy side are at the very front and the 10 lots at the back. A 200 lot iceberg order is now placed, which is divided into 10 tranches of 20 lots each. Now the first tranche comes into the queue and slowly slides forward. As soon as the first tranche has been executed, the next tranche is added. This continues until all orders are executed or deleted beforehand. It is similar with the synthetic iceberg orders, they are also the same size, but with different IDs. If different synthetic iceberg orders are issued and are partially deleted by special algorithms, this can make a specific identification more difficult. Let us now take a look at whether iceberg orders are worthwhile, we will make a comparison without calculating costs, spreads or fees.

We start collecting at different limit levels. The price goes up and the big player collects bid on 6 price levels. The price is pushed down 10 ticks then the exit takes place. The aggregate advantage here would be 1,570 ticks. Now the big player does not collect with limit orders but with 200 market sell orders, which are activated by 200 limit buy orders. He also gets out of his position at 1.10100, the aggregate advantage here would be 1,470 ticks. Now the collection takes place through iceberg orders, the price initially runs upwards, where the big player collects 200 lots with his iceberg orders at a price level. The price is pushed down 10 ticks, then the exit occurs at 1.10100. The aggregate advantage here would be 2,000 ticks. This means that collecting with market orders brings 1,470 ticks in this example, collecting at different limit levels produces 1,570 ticks and collecting iceberg orders gives the big player 2,000 ticks. That is an advantage of up to 40%. In addition, the actual strategy is obscured by the iceberg orders.

Iceberg orders account for around 30% to 60% of the total trading volume. Over 50% of orders for synthetic icebergs are canceled before they are fully fulfilled. The orders for synthetic icebergs use an average of 4 to 5 tranches with an average peak of 4 to 5 lots. The average total volume of orders for complete synthetic icebergs is between 10 and 20 lots. It's interesting to note that the order sizes are often multiples of 5, such as: B. B. 10, 15 or 20. The iceberg orders are therefore used more frequently than originally assumed, and these are increasingly smaller jobs. Iceberg orders are mainly used to absorb the stops from retailers. However, stops have the peculiarity that they are at different price levels, which is why the big players are forced to occupy several price levels with their iceberg orders in order to absorb the decisive volume of the stops.

The price has gone down and up again. In the case of the blue arrow, strong absorption took place as it ran up. Many now believe that a large market player will defend this price level in the future. At first the price went down, then came the rude awakening. So now it goes down. Bad luck again, because there was still a stop hunting, only then did the price go down. If there is a very low volume in the market and suddenly stronger absorption takes place, this is noticeable. Stronger absorptions usually do not occur randomly, but are precisely planned in advance. An example of this is a major currency exchange.

A large company wants to exchange the dollar for the euro to pay salaries. This is an exit from the dollar, which the customer bank completes in this case with market buy orders. Normally the currency exchange would be complete, but the volume of 1000 lots would be distributed unused to different market participants. Now a friendly partner bank could place a 1000 lot iceberg order in the form of limit sell orders at this price level and would immediately have 1000 lots on the bid side. Normally you would have to collect many hours for this, but only at different price levels. What happens now? Market participants see that a big player has placed a 1000 lot market buy order in the market and will suspect that the price is going up. The partner bank will, however, push the course down. When exchanging the euro for the dollar, the situation is exactly the opposite. Exit from the euro with market sell orders from the customer bank. And the interception of the volume with limit buy orders from the partner bank. Everyone thinks the price is going down, but the opposite is happening. The currency exchange euro for dollar can, however, also be processed differently. The customer bank gets out of the euro with limit sell orders and the befriended partner bank invests 1000 lots in the form of market buy orders at the same time. Everyone believes that the price will now go up, so there will first be a downward stop hunting before the price then goes up. The same game also works when exchanging dollars for euros. The customer bank exits with limit buy orders, while the partner bank activates its sell orders brand. Let's look at a specific example of this.

The price was pushed up briefly and a currency exchange took place at the high. The customer bank sold the dollar with market buy orders, which the partner bank accepted with a limit sell iceberg order. The other market participants now thought that the price would continue to rise and placed themselves long. The partner bank then pushed the price down, triggering the stops of the long traders and thereby accelerating the price. Partner Bank exited the dollar just before the low. In the further course the partner bank and also the customer bank tried to collect the euro. And then pushed the course upwards together. The next currency exchange took place there. The customer bank has exchanged the euro for the dollar for its customers with limit sell orders, whereby they have also sold their euro positions from the low at the same time. The Partner Bank entered the market with orders. The majority of market participants now thought that the same game as 6 hours ago would repeat itself and are now short. This created a large upward spike. However, that was of no use to the big players, as they could not get out of their major positions at that point. Due to a partial dissolution of their position, the price went down again. The price was then carefully pushed upwards, with more and more long traders entering the market, which enabled the partner bank to gradually liquidate its position. Conclusion in 12 hours: Thanks to a clever collaboration, two banks have made a profit of 200 million in the Forex market. After, the transfer of the 100 million that the partner bank transmits to the customer bank is very exciting. However, there are very interesting design options that would go beyond the scope of today.

This approach is prohibited by the supervisory authorities, but from my point of view it is relatively easy to prove this offense by the banks. Either the supervisory authorities are unable to understand this approach or they accept this state of affairs. It remains to be seen why there are laws at all if one is not able to monitor them. In the end, the stupid one is the retailer who doesn't know what's going on or doesn't have enough funds to take action against it. We can get angry or upset about it now, or we can just turn the tables and use this information to our market advantage. There are exchange software vendors who claim that their system can capture the majority of iceberg orders. In my next video we will talk about identifying iceberg orders and how the software can help us with that.



I wish you a very successful trading week and look forward to seeing you again next week.

Kind regards Michael

Hello Peter, I agree with you on many points, for this reason I divided my personal life many years ago. There is a real life within an intact family and very close friendships that have nothing to do with trading. Then there is a digital world that I only see as a challenge to have a realistic chance against the best traders in the world. Interestingly, it's not primarily about financial aspects. These two areas are clearly separated from each other. From my point of view, I would even argue that the market is not manipulated, but the stock exchanges set rules that everyone who trades has to accept beforehand. We know that certain big players have priority in the queue at the exchanges. This leads to the conclusion that their placed orders are always as close as possible to the price execution. This is not a manipulation, but a bonus for large traders. In trading, the rules of exchanges are set in the form of matching algorithms and, in some cases, different latency priorities. These rules can favor certain types of market participants like registered market makers by offering them higher matching priorities or even adding artificial speed bumps for other traders. The Chicago Exchange was the first to propose artificial speed bumps designed to delay the actions of incoming traders by 350 microseconds, except, of course, certain market makers who were allowed to use the freeway. Initially rejected as discriminatory, the proposal was later approved not only for Chicago but also for the New York Stock Exchange and other stock exchanges. One of the arguments in favor of admission was that exchanges already offer an advantage for registered market makers in various forms, including, for example, position determination in the queue. And now comes the crucial point: these rules that the exchanges have established can be considered fair because they are public. Traders who know the rules of the game can adjust their trading strategy accordingly, possibly finding markets with better rules, or choosing not to trade at all. This means that as a retailer one have to know that one will be disadvantaged on the stock market, if one still trade and lose, it is his own fault because one have previously accepted the rules of the game. I will go into more detail about the identification of the iceberg orders next week. I wish you a nice weekend.

Greetings Michael

Identification of the iceberg orders




Hello dear traders,

In my new video, we will take a closer look at the identification of the iceberg orders. We look at an example of how a big player makes volume available to himself without performing a currency exchange. What is the difference between MBO and MBP data and is MBO data really worth it? There are some providers of stock market software who promise that they can be used to identify the majority of iceberg orders, which we will take a closer look at. As always, my contributions are only about my personal opinion or experience.



The video is of course produced in 4K again and you can have the spoken text translated into English on YouTube. Of course I will translate the comlete text for you later and post it here for the next few days.

I wish you a lot of fun watching it and a nice weekend.

Greetings Michael

Identification of the iceberg orders



Hello dear traders,


As promised, I translated the content of my new video for you. You can find the video again at the end of the article.

Today we will deal more closely with the identification of the iceberg orders. We look at an example of how a big player makes volume available to himself without performing a currency exchange. What is the difference between MBO and MBP data and is MBO data really worth it? There are some providers of stock market software who promise that they can be used to identify the majority of iceberg orders, which we will also take a closer look at. As always, my contributions are only about my personal opinion or experience. Random or planned world events have no direct impact on the stock market as only the decisions of traders and their actions as a result affect the market. Market makers and high frequency traders are the first to react, so their actions are the fastest global news feed, not the news itself. We have talked about this many times. The currency strength I often mentioned is a clear plus in the foreign exchange market that does not exist in the stocks and futures markets. From this you can get additional, in-depth information that gives us a clear market advantage. Incidentally, the rough currency strength can be read off immediately in every chart. Take the EURUSD as an example. Here two different currencies are traded against each other. The first currency symbol, the euro, shows that the euro becomes stronger when the exchange rate rises, while the second currency symbol USD shows that the dollar becomes stronger when the exchange rate falls. For the US dollar Swiss franc, the rate must rise so that the dollar becomes stronger and the CHF falls so that the franc becomes stronger.

On the right we see the green line that shows the strength of the euro while the red line shows the strength of the dollar. The price of the EURUSD falls if the dollar strengthens, the euro weakens, or both factors occur. In this example, you can use the currency strength to identify almost every reversal point in advance. Anyone who knows how to deal with this currency strength has a clear market advantage. In this case, the euro and dollar strength are compared with the respective seven main currency pairs and therefore provide very precise information. Precisely because this topic of currency strength is a very decisive factor in trading, I will once again produce a very detailed video about it. Please also pay attention to the two resistance zones that I drew in at the beginning, we will take a closer look at them in a moment. My first resistance zone did three pullbacks that lasted 3, 8 and 9 minutes respectively. I usually only spend between one and four minutes in the market. The lower, stronger resistance zone only had one return, but it went up a little more in 11 minutes. After that, the price broke through the lower resistance zone. You can find a lot of information about the crucial key candles in my videos. Many traders believe that a big player always buys the dollar at the high and the euro at the low, but that is a mistake, because there is usually little volume at the high and low. That means that not enough can be collected there.

In this case the dollar was bought in the two equilibria in H1 and shortly before the low there was an exit from the dollar. Only then was the euro collected in the subsequent equilibrium. Then the exit from the euro takes place. The euro is collected again, then the exit takes place. The euro is collected one more time and then the exit takes place again. Then the course was pushed down, a new equilibrium was created where bid was collected. Only then did the course continue to decline. The principle is always the same.

In my last video we noticed that with the limit buy and market buy orders, the big player is able to buy the euro or sell the dollar. With the limit sell or market sell orders, the big player is able to buy the dollar or sell the euro. If the euro is bought, the rate will go up in the long term, if the dollar is bought the rate will go down in the long term. If the dollar or euro is sold, the situation is unclear, as we do not know whether the big player has only made a partial sale or is already out of his position. In the case of a partial sale, the course would continue, if the big player is out of his position, an equilibrium would first have to arise again, where a new player collects. The big players determine the market and use the limit orders for their entries and exits and need the market orders to drive the market in the desired direction. To fill their limit orders, they always look for the volume that is most efficiently found in retailer's stops. With the help of the iceberg orders, the big players can add further limit orders unnoticed and thus collect ask or bid without being noticed. Interestingly, the average iceberg orders are between 10 and 20 lots and not, as we previously thought, an extremely high number of lots. Of course there are also extreme absorptions, but they only arise because a large player makes volume available to himself. The iceberg orders have been studied in great detail by various analysts, and it turns out that iceberg orders accounted for 20-60% of total sales. Many small iceberg orders at different price levels make it difficult to precisely identify the absorption and continue to help the big players to dominate the market undetected.

Banks usually have to accumulate many hours within a narrow range in order to then push the price in their direction. For this reason, they are also able to provide themselves with liquidity. While the price is slowly falling, massive iceberg orders are placed in the limit sell price levels above. At the low, the algorithms completely withdraw the iceberg orders and at the same time start to shoot market buy orders into the market. This triggers the stops of the shortraders and catapults the course upwards. The big player now invests 1000 lot market buy orders there, which he intercepts with his own limit sell orders. He is now 1000 lots short and 1000 lots long invested. Due to the 1000 Lot Market Buy Order, the market's reaction is bullish, massive buyers are now entering the market. These buyers are now gradually being intercepted with iceberg orders, with the big player slowly exiting its euro position. Then he pushes the price down and the stops of the long traders help him. At the low, he begins to exit his dollar position. Conclusion in 4 hours 30 million profit, normally it would have taken him at least three times as long to collect in the Equilibrium. We come to the identification of iceberg orders.

There are various well-known software providers on the market who claim that their stock exchange software can identify a large number of iceberg orders. We will now check to what extent these statements are correct. First of all, it is important to understand how iceberg orders are identified. In the case of native iceberg orders, clear evidence can be provided using the order ID. However, only if the same number of limit orders have been executed within a certain period of time. The entire iceberg order can only be reliably identified after the last tranche has arrived. The tranches of synthetic icebergs are normal limit orders. An incoming order is considered a tranche if it is placed within a short timeframe after a previous order of the same size has been executed at the same price. This results in the following clear differences to native iceberg orders. Since more than one order comes into question as a higher-level tranche, the synthetic iceberg order is best represented as a network diagram of orders. Then the executed size of the order is an aggregated amount of the executed volume of each tranche chain. Since the recognition process as such is speculative, normal orders can also be classified as iceberg tranches under certain circumstances. This means that synthetic iceberg orders can only be estimated heuristically and on the basis of a number of assumptions.

In the S & P500, the proportion of native iceberg orders is just 4% and the proportion of synthetic iceberg orders is over 30% of total sales. Incidentally, the share in the euro US dollar is twice as high. In principle, however, it does not matter how high the share of iceberg orders is in the total turnover, the overall distribution of the native and synthetic iceberg orders among each other is decisive. Of all the iceberg orders submitted, the proportion of native orders is 12% and the proportion of synthetic orders is 88%. The largest big players only work with synthetic iceberg orders, while smaller players trade with native iceberg orders on the stock exchange. What does this mean for us? If 50% of 100% of the total volume falls on iceberg orders, iceberg orders can be clearly identified for 6% of the total volume and not for 44% of total sales. Since only the big big players move the market, the clearly identifiable iceberg orders of the smaller players are not relevant in order to make a clear trading decision. Of course, iceberg orders can be identified with any time and sales list. The problem is that many smaller iceberg orders come on the market every day and cannot be clearly assigned to a possible strategy. We retailers try to track down the big players' aircraft with a car navigation system. There are roads in the sky but we cannot identify the big players as they regularly place invisible iceberg orders. And these limit orders are almost impossible to find. Footprint and volume diagrams and the market profile do not help us any further.

The statement of the software manufacturers, who advertise with a clear identification of the iceberg orders, is: We use an algorithm developed in-house to recognize and predict iceberg orders. I think that says it all. I only get specific information from the native iceberg orders, in 88% of the cases I have to rely on an estimate. If I buy a car that only does what I want in 12% of the time, I wouldn't buy that vehicle. The stock market is not about life or death, but it is about a lot of money. That's why I don't work with such software. In addition, I have to work with MBO data, which cause fees that are 3 times higher. The order book only changes when traders carry out new promotions or conditional orders are released according to their maturity settings. Consequently, exchanges generate market data and inform traders of changes. Today there are two different types of market data. Market-by-order (MBO) describes an order-based data feed that offers the option of displaying individual orders and their development. The information of the order includes its unique order ID, the limited price, the size and its position in the queue. MBO usually offers full market depth and describes orders at every price level. Market-by-Price (MBP) describes a price-based data feed that offers the option of displaying the total size of all orders at each price level. MBP can either describe the full depth of market or a limited number of closest bid and ask price levels, e.g. 5, 10 or 20 price levels. At first glance, the upper split limit sell order offers more information, of course, but what is the purpose of these orders? Should the dollar be bought or is it an exit from the euro? Are there still enough market buy orders coming into the market to keep moving up or is the price reversing? I do not get this information, for this reason the MBO data is only a clever marketing strategy for most traders on the part of the stock exchange and the software provider.

We know that certain big players have priority in the queue at the exchanges. This leads to the conclusion that their placed orders are always as close as possible to the price execution. In trading, the rules of exchanges are set in the form of matching algorithms and, in some cases, different latency priorities. These rules can favor certain types of market participants like registered market makers by offering them higher matching priorities or even adding artificial speed bumps for other traders. The Chicago Exchange was the first to propose artificial speed bumps designed to delay the actions of incoming traders by 350 microseconds, except, of course, certain market makers who were allowed to use the freeway. Initially rejected as discriminatory, the proposal was later approved not only for Chicago but also for the New York Stock Exchange and other stock exchanges. One of the arguments in favor of admission was that exchanges already offer an advantage for registered market makers in various forms, including, for example, position determination in the queue. Now it's getting interesting: These rules that the stock exchanges have drawn up can be viewed as fair because they are public. Traders who know the rules of the game can adjust their trading strategy accordingly, may find markets with better rules or choose not to trade at all. This means that as a retailer you know that you will be disadvantaged on the stock market, if you still trade and lose, then it is your own fault because you have previously accepted the rules of the game.

Of course, trading consists only of assumptions that each trader receives based on his or her individual information. The more specific and precise this information is, the more accurately a trade can be executed. In addition, we should know that the more participants follow a similar strategy, the lower the chances of winning. Since I only trade in EURUSD, where is permanently absorbed, iceberg orders are less relevant to me. It also doesn't matter how many iceberg orders are behind the limit orders, as they can only accept as much volume as the market currently offers. I see that immediately in the DOM, in the time and sales list and in spoofing. An absorption of market orders by the iceberg orders does not usually lead to an immediate trend change. The overview of my specially filtered limit orders in connection with the strength of the market and limit orders is the fastest way for me as a scalper to predict future movements with a very high probability. I pay attention to orders that have already been executed, which means that the big player is still directly in the market. You can find a lot of information about this in the videos I have provided.

There are a number of factors that make trading more successful, such as: access to critical data, filterable analysis tools, and high quality visualizations to convert into useful information. Also to develop effective tactics based on knowledge to predict future events and minimize the risks. The speed of data processing and execution of actions is also a decisive success factor. Together, these factors result in an even stronger competitive advantage. For example, executing a wrong price direction forecast quickly results in a worse execution price than executing slowly in the right direction. That is why it is much more important to know what is happening in the market. The iceberg orders have a significantly lower relevance to the immediate price development in the EURUSD than in the Dax or S&P, since the liquidity in the EURUSD is higher and thus the volatility is lower. In return, security increases and with a clear strategy, profits become more sustainable.




I wish you a nice weekend and good business success.

Kind regards Michael

Currency strength in forex



Hello dear traders,


Today's post is about currency strength, an advantage that you only get in the forex market but not in the futures market. We look at the individual effects and whether you can use this information to increase your probability of winning. We also compare paid currency meters with free currency meters, the result will surprise you. With the right approach, by the end of my post you will be able to immediately identify the strength of 28 different currency pairs. You will of course get the appropriate tools from me.



The video is of course produced in 4K again and you can have the spoken text translated into English on YouTube. Of course I will translate the text for you later and post it here tomorrow at the latest.

I wish you a lot of fun watching it and a nice weekend.

Greetings Michael

Currency strength in forex



Hello dear subscribers,


As promised, I translated the content of my new video for you. You can find the video again at the end of the article.


Today's post is about currency strength, an advantage that you only get in the foreign exchange or forex market but not in the futures market. We look at the individual effects and whether you can use this information to increase your probability of winning. We also compare paid currency meters with free currency meters, the result will surprise you. With the right approach, by the end of my post you will be able to immediately identify the strength of 28 different currency pairs. You will of course get the appropriate tools from me. In my youth there was a comic magazine (YPS) that always included a gimmick. For example a machine that produces square eggs. First an egg was boiled, then enclosed in the plastic box and placed in the refrigerator. At breakfast our parents were amazed that there are actually square eggs. Why am I telling this? Well, here you are, a dashboard developed by me that gives me different views in the area of currency strength. You can create this dashboard yourself with a few clicks of the mouse, the indicators and the corresponding template can be found in this post. I also wanted to provide you with a kind of YPS booklet so that you can put my information into practice immediately afterwards.

Viewed collectively, retailers always trade against the trend, tend to expand losing positions and go mostly in a biig loss with their entries. The big players are usually always in a better situation. You have sufficient capital to take on a variety of independent, simultaneous positions with different entry levels. Diversification and the law of large numbers are used to minimize risks and smooth profits. Incidentally, casinos also use these factors by providing several gaming tables at the same time. On this chart, the white line represents the volume of long retail positions in EURUSD at the CLOSE of each M15 candle. What is interesting is how this value goes down as the price goes up. In contrast, when the price falls, the retailer volume of long positions increases. The bigger candles are caused by the stops of the retailers and not by a massive number of market orders added by the big players. In USDCHF, the volume of long positions in retail is falling while the big players take the opposite side. It should be clear who sits on the longer lever. We see that the retailers are on the wrong side almost at all times, which also explains the high loss rates in the retail sector. For this interesting presentation, by the way, many thanks to Hanover, a very creative and professional programmer of the largest trading platform Forex Factory. I will come back to him later. There are a number of different representations of the currency strength meter. In today's post we will also look at whether currency strength indicators that cost money are superior to free ones.

The typical strength indicators give an idea of how much a currency has moved compared to all other currencies against which it is compared. Of course you can use it to see if the dollar is strong in relation to other currencies. You can use a currency strength meter to identify a strong currency and a weak currency. Many traders take advantage of this information and trade the strongest against the weakest currency. We'll take a closer look at whether this is actually a smart idea. Today's comparison is about 8 currency strengths from which a total of 28 currency pairs are formed. Let’s first look at how high a currency’s share of the total turnover of the forex market is. The NZD reached a share of 2.1%, the CAD reached 4.9%, the CHF already passed the 5% hurdle, the AUD reached 6.8%, while the pound reached 12.8%. The first three places are occupied by the yen with 16.8%. In second place is the euro with a share of over 32% and first place is the dollar with over 88%.

Here we can now see how the dollar is calculated in five different time units against the seven other currencies. Let us now compare the eight different currencies to one another. Red shows weakness while green highlights strength. In this graph, the dollar is the weakest and the New Zealand dollar is the strongest. Now you can sort the different currencies in different time units according to their strength, with the strongest currency at the top and the weakest currency at the bottom. This results in the 28 different currency pairs that we can also sort in the five different time units according to their strength. Overall, this currency strength knife is very detailed if you want to have an overview of all 28 currency pairs. Since I personally only work with the euro, the US dollar, of course, only the euro and dollar are relevant to me. From this I filtered my own currency strength meter only for the euro and dollar. The individual columns show the respective time units. In the upper area we see the dollar strength and in the lower area the euro strength. To the right of it I have once installed an M1 chart to show you exactly how this display works. The left column, where the currency strength is calculated in the M1, of course reacts much faster than in the last column, where the monthly observation takes place. Therefore, pay close attention to the first three columns.

First of all, we can see that the dollar strength is in the foreground. And now pay attention to how the dollar is getting weaker and the strength of the euro is increasing. Initially, the euro and the dollar are in equilibrium, and it seems as if the dollar wants to push the rate down again. Now we can see how the euro is getting stronger and stronger, the reaction: The price is being pushed up very quickly. Once again there is a balance between the euro and the dollar, which the euro ultimately decides for itself. Although the price is now fluctuating back and forth, we can see the clear euro dominance, which would still allow an entry to the top in this situation. A slightly different view consists of two different lines running in a 100% value. The red line shows us the strength of the dollar while the green line shows the strength of the euro. In this case, the dollar strength is around 62% and the euro strength is around 30%. First we draw a center line at 50%. We can thus see that the respective currency is strong above the middle line and as soon as it moves below the middle line, it tends to show a weak trend. Let's look at an example of this.

Above are the candles below is our strength indicator. At the beginning the course runs down a bit. In the area of the strength indicator, we can clearly see the dominance in the dollar. Now the course is going up, here the euro strength is clearly in the foreground. There is a brief pullback, but we can already see that the dollar is weakening. The course is now continuing upwards, with the strength of the euro in the foreground here too. Then there is a downward movement, the dollar has a clear advantage. The exchange rate is going up again, interestingly, the dollar rises at the same time as the euro, with the euro still having a slight advantage. Now the price is going down again and we can see the clear dominance of the dollar. When a bullish candle arises, there are theoretically three starting situations. The strength of the euro remains unchanged while the dollar is weakening. The euro strength increases while the dollar strength remains the same. The euro strength increases while the dollar strength decreases. Of course, these three initial situations also apply to a bearish candle. While the dollar strength remains the same, the euro strength decreases. The dollar strength increases while the euro strength remains the same and the dollar strength increases while the euro strength decreases at the same time. This situation would accelerate the downward movement more.

Let's look at another example in an 8 tick chart in EURUSD. On the left is the dollar strength, on the right we see the euro strength. The strength in M1 is in the middle and the time units increase outwards. Now pay attention to the two inner areas, as this is where the quickest reaction can be determined. In the middle we see the strength of the euro and the strength of the dollar in the form of two lines. Below that I have once again drawn the dollar strength individually within the 8-tick chart. If the yellow line is above the center line, the dollar is strong; if the yellow line is below the center line, the dollar is weak. Let us now observe a live price. The strength of the dollar has a clear advantage, as we can see in both the top and the bottom diagram. The price is therefore going down. In the lower area there is initially a small equilibrium, we can see that the dollar is still very strong. The euro is gradually getting stronger and the rate is rising. In this case, the tick chart display actually shows significantly better results than the upper display in the M1. We can see that the strength of the euro continues to have a clear advantage, which also explains that the price continues to rise more strongly. Suddenly there is a small breakout downwards, in the tick chart we can see that the strength indicator only reacts at this moment. The dollar strength in the M1 is increasing and the rate is falling again.

Based on this example, we can see that the strength of the currency is also lagging behind the price. And that is also logical, because after all, all currency strength indicators in the forex market are calculated from the price, and not from the volume, as the volume in the forex market is not completely available to us. Incidentally, the calculation of the currency strength within the tick chart is not entirely correct. This is simply because the other counter currencies would theoretically have to be calculated simultaneously within an 8 tick chart in order to arrive at a correct calculation. The correlation between retail volume and currency strength is very accurate. This means that the retail volume can theoretically be used as a leading indicator just like the currency strength itself. It is also important to know that it is not the indicator that is the decisive factor in trading, but rather how the respective trader interprets the data taken from it. Now let's take another look at our currency strengths on the left. We find that of the eight currencies, the dollar is the weakest while the New Zealand dollar is the strongest. If we look at the NZDUSD during this period, we actually see a stronger rise to the upside. But I generally warn against trading the weakest currency against the strongest. The background is that at the time of entering the market you can of course never know whether the current currency correlation will continue to exist.

We see that the dollar is getting weaker and the euro is getting stronger so we decide to buy the euro. The decision was right and we are getting out of the euro. The euro continues to get weaker and the dollar stronger, we now decide to buy the dollar. This decision was also the right one and we are getting out of the dollar. The euro is getting stronger the dollar is getting weaker we decide to buy the euro. A short time later we realize that this decision was not the best. From my point of view there are some possibilities for improvement in the area of currency strength, for example in the representation of how much a currency changes within a certain period of time. However, the correct way of looking at currency strength brings additional benefits that a trader can use to their advantage. I myself use different currency strengths in my charts, which often help me. However, I admit that I only keep an eye on the strength of the currency every now and then. I would never use the currency strength individually to get a market entry. However, it often helps me to stay in the market a little longer in order to make a little more profit. Now we come to my promised dashboard, with different currency strengths and additional, interesting tools that you can download. First you have to go to my blog at Forex Factory, I link the page in my descriptions on YouTube.

This is about the post with the number 1472 on my blog. If you scroll down I will roughly explain the structure of my screens again and then we will come to my dashboard. In this post you will find all the explanations about this dashboard and the indicators, as well as a few auxiliary indicators for stop hunting. In addition to clear installation instructions, you will finally find the indicators including a template to download at the end. But please read through the text or have it translated into German. In the zip file you will find different currency strength indicators, with which you are able to calculate individual currency strengths. So you can easily determine the respective currency strength in all 28 different currency pairs. If you need help or what advantages Forex Factory has to offer, check out my video on the topic: Finding Similar Traders. There you will discover other interesting clues that will help you advance in future trading. By the way, when you are at Forex Factory, please pay attention to the members shown in the chart. ( hanover, FerruFx, Gvc, Erebus, Rafei, honestknave, FiatFap, Kang Gun; there are also many other creative programmers) They have programmed incredibly good and professional currency strength indicators that are just as good or even significantly better than all currency strength indicators that you can buy. The paid currency strength indicators are inferior in all areas to the free indicators that you can find on Forex Factory. Believe me, the best MT4 programmers can be found at Forex Factory. By the way, at Forex Factory there are almost 1 million members in the stocks, forex and future sectors. At this point I would like to thank all active members of Forex Factory once again, who help many traders every day with their great work.

Let's draw a conclusion

Today I was only able to roughly show you the advantages of currency strength. We know the strength of the currencies is calculated from the price and ultimately the accuracy of the data depends primarily on your broker. Basically, all indicators give a retrospective view of what the price has caused and therefore have no more predictive value than the price itself. In addition, the predictive value depends on the strength of sentiment, which is determined by a number of different reasons. A price-based currency strength indicator is of course not able to take fundamental factors into account. In principle it is a very interesting tool that every trader can interpret individually. And it is precisely this interpretation that always determines success or failure. By the way, almost a year ago I posted my first video at YouTube, so we'll be talking about the future of trading next week.



I wish you continued success in trading and look forward to seeing you again next week.

Kind regards Michael

Trading in the year 2050

Attached Image

Hello dear traders,


my 41st YouTube video is an anniversary video, so today we're going to take a look into the future to see how our technology could change in the next 30 years, both privately and in trading. Very interesting and exciting projects are just around the corner, which we can look forward to, but this could also lead to possible situations that we should then question critically if necessary. Of course, I'm not a clairvoyant who can foresee the future, so this is just fiction. In the end, the user always decides whether the things we are talking about make sense or not, if it comes to the point, that this technology conquers the market.



The video is of course produced in 4K again and you can have the spoken text translated into English on YouTube. Of course I will translate the text for you later and post it here tomorrow at the latest.

I wish you a lot of fun watching it and a nice and relaxing weekend.


Greetings Michael

Trading in 2050 with 3D DoM

Attached Image (click to enlarge)

Hello dear algorithm traders,


As promised, I translated the content of my new video for you. You can find the video again at the end of the article


My 41st YouTube video is an anniversary video, so today we will take a look into the future to see how our technology could change in the next 30 years, both privately and in trading. Very interesting and exciting projects are just around the corner, which we can look forward to. But this could also lead to possible situations that we should then question critically if necessary. Of course, I'm not a clairvoyant who can foresee the future, so this is just fiction. In the end, the user always decides whether the things we are talking about make sense or not, if it comes to the point that this technology conquers the market.

First of all, I created this trading channel to accelerate my own development process. Since, of course, I don't know everything, detailed research is often necessary, so I force myself to absorb very in-depth knowledge and understand it. The subsequent task of presenting the relevant facts in the video as simply as possible results in interesting projects that help me to penetrate even deeper into the market. It is a kind of turbo for my own absorption of knowledge, with the advantage of developing creative ideas for my future from this knowledge. I uploaded my first YouTube video almost a year ago, and I never thought that so many people would be interested in it. 40 videos with 23,644 views and a playback time of 3,200 hours - that's a hell of a lot in the small market niche of algorithms profiling. Incidentally, a total of 476 subscribers follow me. I find it amazing that my videos have appeared almost 200,000 times in the form of impressions so that a YouTuber clicks on them. First of all I would like to thank all followers for the positive feedback, confirmations and of course creative ideas. In the last few months I have been able to get to know great people, professional programmers and very successful traders, for which I would like to take this opportunity to thank all of you in particular. My aim is not to reach 100,000 followers, that would also be unrealistic, as there are only 50,000 forex or future traders in Germany. Algorithm profiling is only interesting for a very special target group, which is why I see this channel as a kind of elite circle, where crazy traders like me come together.

Today we don't want to talk about whether beaming or time travel will be realistic in the future, but rather deal with topics that may not be that far removed from us. My first cell phone still cost 2,500 DM and at the time I paid 6,000 DM for the car phone. The cell phones then became smaller and smaller and of course cheaper. That was 30 years ago. Believe it or not, progress will accelerate again in the next 30 years. We are already working on autonomous vehicles, because in the future many drivers will no longer feel like standing in traffic jams for hours. A traffic control system in the city should provide a remedy, which gives each road user individual speed recommendations in order to save the driver a waiting time at the traffic lights. In addition, the system is even able to tell the driver how long it will be before the traffic light turns green again. If this information is sent directly to the autonomous vehicle, we could be spared long waiting times in the medium term.

The Yellow Pages used to be used in book form and Windows had to be installed with a DVD. Today everything runs over the Internet and it is much faster and more efficient. A single Google search runs over 2000 servers on 2-3 continents. That is a clear difference compared to the yellow pages. Large amounts of data were stored on external hard drives, these are increasingly being replaced by cloud-based storage. The cloud means something like: External work on other people's computers. Saving data in the cloud has advantages that cannot be denied: Whatever you copy into such a data cloud, ideally is then always and everywhere available. So you can show grandma the family photos on her television or in a conference hotel you can quickly call up the presentation that you have prepared in the office. We use the cloud every day without noticing. Our e-mails are in a cloud, the photos from the iPhone and also Netflix or Prime are provided by a cloud. With Google Maps we always find the right way, even with Spotyfy we don't care where the music is, it's all about the access rights that entitle you to listen to music. Anyone who has concerns about security should no longer query their bank details via the cloud in the future. That means we already trust the cloud more than we realize. But that is only the beginning.

It is possible that in a few years we will be handling our entire infrastructure via the cloud. That means our servers, networks and even complex storage infrastructures are completely in the cloud. Theoretically, we would then no longer need any hardware, but basically just a kind of browser that brings us to the cloud. This would make expensive processors, graphics cards and RAM memory a thing of the past and the computer as we know it today would become extinct. The cell phones would also get by without hardware. The prerequisite would of course be an almost latency-free Internet. You can then build your own infrastructure within seconds, access high-quality hardware and software and merge different apps without programming knowledge. Small companies could then afford high-quality software. A complete company network with servers, routers and switches is set up in the cloud within seconds and can be expanded at any time. This allows different people in different locations to work in the same program at the same time. The greatest advantage, however, is to use the resources as required. In addition, artificial intelligence will play a very important role in the future, especially in the cloud sector; we are already familiar with self-learning AI in the area of speech recognition.

Imagine that: two authors are writing a book at the same time and real-time editors correct the errors immediately in the background. Scientists from around the world are working together on a drug via the cloud at the same time. In this way, for example, vaccines or even a cancer drug could be developed much faster and more effectively. New vehicles or spaceships that are designed could be immediately created as a prototype using a quantum computer. This could significantly reduce the development time. In the future, we could use the cloud to make real-time phone calls in all languages or even speak to one another. The AI immediately translates all languages. There will probably be no more letters in the future either. The functions of Smart Home will also improve significantly in the future, not only heating, light, alarm system and electricity can be controlled while on the go, the refrigerator orders new goods, the flowers are watered automatically. And when you are abroad, to monitor the apartment you only use an app. The heating goes down and the lights turn off as soon as you leave the apartment. In the future, the kitchen will also automatically prepare our meals for us. It is practically like having your own domestic help who always looks after the right thing.

Many things will also change in the stock market area. Just as there is only one Forex market, all exchanges will join forces in the future and move their entire infrastructure to the cloud. The number of brokers will be extremely reduced and the broker will become a service provider who even offers algorithms or order strategies developed in-house. This will significantly reduce the costs for spread, fees or commissions. This creates a number of advantages for the retail trader. He can see his previously configured screen on any PC, iPad or mobile phone and work individually with his settings. He can change his broker or his stock exchange software within a few minutes. Since theoretically every market participant has the same latency times in the cloud, there are artificial time blocks. These time blocks can be reduced by higher fees in order to achieve faster market entry. Similar to the way certain big players come together, there will also be trader groups in the retail sector in order to have a chance against the larger market participants. The cloud makes the exchange even faster and more opaque for many participants. Due to the fact that trading is primarily based on algorithms, the candlestick charts will become less and less important. There will be new algorithm charts that give participants even deeper market insights.

The future DoM and the time and sales list will bring deeper insights into a 3-D animation that can be individually filtered. As you can see, with this 3D DoM you are able to absorb 33% more information in the same time. If you can do this and interpret this information correctly, you can significantly increase your profit rates. Market technology and volume trading are being replaced by trading algorithms. However, we should be aware that the big players will always be one step ahead of us in the future. In a few years there will be regular trading of sophisticated algorithms that will also bring retail traders considerable advantages in certain situations. Quants and programmers who know about it will make millions in the future. The algorithms make the trader of the future more and more of a tracker. Those who can best identify these algorithms will be successful as a trader. New data glasses make it possible to show virtual, interactive 3D objects in the real environment as if they were actually physically present. This means that there will be no screens in the future. With these glasses, a trader can theoretically go public for a short time in his mobile home or with friends without disturbing anyone. Possible applications are the modeling of 3D objects directly on the desk or games that combine the real world with virtual elements.

The future could possibly be very exciting, because not only does the stock market benefit from it, but also people. In the medical sector in particular, doctors could also perform operations around the world using robotic arms via the cloud. With new washing machines we will reduce our water consumption by up to 90% in the future. Nylon balls are used for cleaning, which attract dirt particles like a magnet. Just as there is a printer in almost every household nowadays, in the future it will be a 3-D printer that can print everything from egg cups, tool boxes, Star Wars figures to individual shapes. There may also be contact lenses with a zoom function. This visual aid consists of a series of telescopic lenses that were originally developed for flying drones. They allow the wearer to instantly switch between normal vision and triple magnification at the blink of an eye. In the future, drones will have more tasks. In addition to delivering packages, drones could even examine bridges or buildings, inspect pipelines from the air, explore unaccessible areas or even save lives. Roads could be covered with solar cells in the future. These glass road pavements not only provide electricity, but can also illuminate themselves, display markings or keep the streets free of ice. We can already charge our cell phone freely via induction. Perhaps one day it will also be possible to send our normal electricity to consumers via the radio network. That would save us the annoying cables. Imagine the electric cars would charge while driving. The cloud could possibly even be the transmitter for this.

But in addition to all the relief, the cloud also brings with it dangers. 89% of Android apps and 39% of iOS apps require access to private information. These apps send our data to cloud servers to both boost the performance of the application and to store our data for advertising. Of course, big data companies claim that they would not store our data for long or use it in a malicious way. As soon as we accept their terms, which incidentally we rarely read, our private data is no longer private. This data is then in the cloud. This cloud is neither tangible nor can we, as data providers, fall back on it. We get access to applications that might make our life easier or better, but what actually happens to our data? Of course, one could argue that a large company can spend more money on cloud security than a single person could. Nevertheless, a method would have to be developed that does not require the storage of personal data. One could create algorithms that work locally instead of being mixed with other data sets in a centralized manner. Of course, you can't expect that from companies like Google, who live from data collection. That is why there will be companies in the future that offer a special cloud private sphere. The cloud isn't dangerous, but it's the excuse and tool that enables the bulk collection of our personal data.

Perhaps after seeing my contribution some of them will be secretly happy that they will retire in 20 or 30 years at the latest so as not to have to experience this situation. But we all know that the future is a creeping development process that does not come overnight, but that develops very slowly. And when the stock markets change, we have to be ready to change us too, because changes only benefit those who are prepared for them. Of course I can't say whether it will get better if it changes, but I can say that much, it has to change if it is to be good.



I wish you all the best in trading and keep my fingers crossed for you.

Kind regards Michael

EA (Expert Advisor)



Hello dear traders,


Today's post is about Expert Advisor who promise huge returns for many traders. First we will look at how these EA's are structured and examine their advantages and disadvantages. Then I'll show you how some sellers tune their paid EA's in order to sell them. We are also examining the use of EA's by the big players and looking at the position of the programmers.



The video is of course produced in 4K again and you can have the spoken text translated into English on YouTube. Of course I will translate the text for you later and post it here tomorrow at the latest.

I wish you a lot of fun watching it and a nice and relaxing weekend.


Greetings Michael

EA Expert Advisor


Hello dear subscribers,


as promised, I translated the content of my new video for you. You can find the video again at the end of the article.


Today's post is about Expert Advisors who promise huge returns for many traders. First we will look at how these EA's are structured and examine their advantages and disadvantages. Then I'll show you how some sellers tune their paid EA's in order to sell them. We are also examining the use of EA's by the big players and looking at the position of the programmers. Expert Advisors, also known as EA, are automated trading systems written in the MQL4 and MQL5 programming languages. They are designed to automate trading activities and can be programmed to notify the trader when a trading opportunity arises. Alternatively, EA's can also carry out all of your activities automatically. Order orders are then sent directly to the server, and values for Stop Loss, Take Profit and Trailing Stop are managed and adjusted. EA's follow different rules to find the right times for market entry and exit.

This can reduce emotional trading decisions to zero, which are often responsible for wide-ranging mistakes. Thus, an EA can provide an emotional stability that could hardly be achieved with human decision-making. In addition, an EA has the ability to evaluate several parameters at the same time, which the human brain would not be able to do. EAs use technical indicators to make a decision. Many factors can be taken into account in this decision, although these must be precisely specified beforehand by the programmer. The EA then implements these decisions in concrete terms, without resorting to emotions. Another important aspect is that the computer always adheres to the trading system once it has been set up, without ifs or buts. An EA is able to act around the clock, offers objectivity and distance. He does not have the negative traits of a trader such as impatience, fear, vengefulness, greedily stressed or tired. However, there are also some restrictions to be aware of when trading EAs. Robots are unable to make intelligent or important decisions. They have no understanding of the market, cannot understand or react to basic data. Likewise, they cannot adapt to unexpected market conditions.

An EA is only as reliable as the quality of the coding. Incorrect coding can lead to unexpected time delays and a small mistake can lead to unpredictable events. When a trader hires a programmer to write an EA for him, it often has consequences. If the EA works at the beginning, the trader is of course the hero, as he has provided the specifications for it. If the EA doesn't work properly after that, of course it's the programmer's fault. Basically, a programmer can of course only program what is communicated to him. Of course, there are also programmers who interpret certain things differently or who do not set up programs in a way that is resource-efficient. In addition, the human brain is able to act intelligently and flexibly. It can recognize complex patterns, weigh several contradicting factors at the same time and adapt to extreme conditions. An EA does not have these capabilities. Most EA's are programmed very simply and primarily follow the approaches of the big players less. This is also logical, since a retailer can enter and exit the market relatively quickly and usually does not work with iceberg orders. Many EAs only relate to indicators that track price. On the one hand, these are easy to program and are less based on an adequate understanding of price behavior.
Data mining and back testing is a major threat in the EAs area. Many assume that what was profitable last year will continue to be so. Over the past few years I have analyzed a few 100,000 candles and found that no identical patterns occurred. Theoretically, an EA should work the same in all markets or realize similar profits. And that is precisely what is not the case. It should also be noted that trend following systems are less popular in the area of EAs due to their low profit rate. It becomes problematic in the equilibrium, since these systems do not work there. Newcomers and beginners prefer a quick and constant profit, especially in the field of EAs, the sellers of EA's have long since understood this and are in tune with it. Added to this is the curious stopping of most market participants, always below the last low or above the last high. These are almost always caught by the big players, which makes it even more difficult to program a profitable EA. Due to the high frequency traders and big players with their algorithms, the market structures change considerably. These factors lead to subtle changes in price behavior, which also dilutes the effectiveness of EAs. Another problem is that you can't implement psychological factors into an EA. That would be important, however, since the stock market is based exclusively on psychological aspects.

First of all, we should ask ourselves why the big players don't work with successful EAs. Every year you have to pay many millions for your analysts, traders and computer experts. A successful EA could save them a lot of money with it. Believe me, a lot of experiments have already been run in this area, where the best mathematicians, physicists, economists and programmers have been involved. But if you compare the risk with the profit, it is cheaper for the big players not to rely on fully automatic EAs. We should think about that. Of course, the big players work with algorithms, which are, however, controlled by hand and monitored by the traders at the same time. However, these algorithms cannot be compared with the conventional price-based EAs. Perhaps some will now argue that the high frequency traders work with fully automatic algorithms. That's right, but arbitrage trading in this area is a completely different topic that cannot be compared with normal trading, as the risks are significantly lower there. It is interesting to note that most of the retail EAs that are sold operate at a high profit rate and low CRV as most buyers are looking for quick and consistent income. But personally, I don't like the way these EAs are advertised and sold. Let's see how easy the scammers work.

We take a moving average, a MACD and an RSI. Now we are trying to coordinate these three indicators with one another in such a way that future and profitable trading directions result from them. We now create these orders as an EA, which generates automatic entries and exits, provided that the criteria we have created are met. We are now doing different backtestings. We use different ASSETS from the area of stocks, currencies or indices. If the return is low or negative, we simply adjust our criteria and the programming again and let the backtestings run until it fits. Let us now assume, that we carried out six different backtestings and there were six different results. Then of course we take the best average monthly result and look at it carefully on a monthly basis. We recognize the first half of the year was a zero number, in the second half of the year the positive return averaged 8% per month. Now we take October, November and December as a basis. This results in an average return of 30%. Now we run our back testing again exactly during this period and of course achieve unbelievable returns. Let's look at an example that I found on the Internet. The participant started with no less than ten euros, let the EA run for four months and in the end won 1 billion euros. If that's not convincing. Of course, he also produced a detailed video so that everyone can see exactly how strategically and precisely the EA is working. Because of this advertising there are some traders who want exactly this EA.

At the end we see the overall result. If this Super Expert Adviser costs € 500 once and 2000 traders fall for it, then the seller has not earned 1 billion but at least 1 million. In fact, it seems tempting to borrow $ 10 from Grandma, then start the EA for four months, and in the end you can retire with $ 1 billion. Incidentally, if you were to use the same EA in other assets or change the period in EURUSD, the returns would look completely different. As we saw earlier in his EA video, some 30,000 lots were traded within a few seconds. In euros, US dollars, 20 million lots are traded every day; that's 14,000 lots per minute. If someone goes into the market with 30,000 lots, that's double the minute turnover in EURUSD and in the futures market that's even 15% of the total daily turnover. Incidentally, 30,000 lots corresponds to sales of € 3 billion.

Firstly, you would immediately attract attention with € 3 billion and the big players would get the volume; secondly, it is questionable whether you will even get an execution with this volume, thirdly, there is no broker who will provide you with a margin, fourthly, we forget about it often the spread, requotes or slippage and fifthly the prices or the candles are random, ie there are no clear patterns in this area. Thus, all subsequent prices or candles are again purely random and cannot be identified using a clear pattern. However, the programming within an EA is based on internal patterns. From my point of view, these factors have to be considered if you want to work with EAS.

Because of this, I am very skeptical of the EAs. Let's imagine that you are trading profitably in the long term. Now start to write down which factors have to come together in order for you to enter the market, how the market has to behave so that you remain in the trade and in the end what has to happen in order to exit the trade. If you write down all of these things carefully, you will find that your many and varied criteria could never be built into an EA. And why? Because there are just too many things that you pay attention to in trading at the same time. Nevertheless, I could imagine that the EAs could also help us in retail in the long term. But only if they show us possible entry points that enable profitable trading. However, it should still be up to the trader to decide whether to enter this trade or not. These hybrid EAs could inform the trader of things that he is unable to see.

The price and the candles are the effect, the cause lies in the market orders that run into the limit orders. Most EA s only access the effects, if you are already programming an EA, you have to realize this in the area of the causes. So consider the DoM and time and sales list as well as the spoofing data. The effect, i.e. the price, the candles and indicators do not bring you anything. The reason lies in the law of causality. Causality means that there is a clear cause-effect relationship between variables. Unfortunately, there are only effects in the forex market. I will go into this again in a special video. By the way, I recommend C ++ as the programming language, as it can implement the fastest implementation in this area.

As it stands, most EAs seem to put money into the sellers' pockets more than whoever is using them. Then honestly, if I invent a machine that predicts the lottery numbers, why should I sell this machine? Well, there's really only one good reason to sell this machine if it doesn't work. This is exactly why I would always recommend a beginner to invest a few years in order to learn trading properly and professionally instead of relying on a machine that firstly you don't know how it works and secondly you can never be sure how long it works. I would never buy an EA myself, because the EA don't understand the basics of the market and he can never make his own decisions. However, this is a crucial point in order to have a chance at all on the stock exchange markets.

To the left of the chart you can see the heartbeat of a trader who is currently opening a trade. Within a short time the heartbeat increases by almost 40%. Depending on the situation, it can also be significantly higher. A good reason to take a closer look at the topic of health in trading, because there are 1000 diseases, but only one health.



I wish you a very successful trading week.

Kind regards Micha

Healthy and fit in trading



Hello dear traders,


In today's post you will get some tips on how to stay healthy and fit in everyday trading. We talk about how to avoid back problems, get fewer headaches, concentrate better on the market and of course also about the dangers of CO2 when trading. I will show you how you can control your heartbeat on the computer screen and how you can possibly improve your health values. With a few tricks you can achieve a lot with little effort.




The video is of course produced in 4K again and you can have the spoken text translated into English on YouTube. Of course I will translate the text for you later and post it here tomorrow at the latest.

I wish you a lot of fun watching it and a nice and relaxing weekend.

Greetings Michael

Healthy and fit in trading


Hello dear subscribers,


In today's post you will get some tips on how to get healthy and fit through everyday trading. We talk about how to avoid back problems, get fewer headaches, concentrate better on the market and of course also about the dangers of CO2 when trading. I will show you how you can control your heartbeat on the computer screen and how you can possibly improve your health values. With a few tricks you can achieve a lot with little effort. The tips I mentioned are for entertainment purposes only and are not to be understood as medical advice. Basically, I always recommend following the advice or recommendation of your doctor. A few years ago there was a worldwide statistic that showed that only about 20% of the world's population is really healthy. Most of them are not necessarily terminally ill, but neither are they healthy. I found that terrifying. In addition to back pain, depression and iron deficiency, there are many other things that limit our lives considerably. A family spends around € 100 per month on health, which is only around 4% of household income. We humans want to live as long as possible, which is why one should also invest in one's health, which is not always related to the issue of money. The fact is that humans consist of what they eat, drink and how they move. For this reason, in addition to money, you should also invest the appropriate time in your health.

Maybe you know the rule of three. Humans can survive 3 minutes without air, 3 days without water and 3 weeks without food. Let's start with the CO2 first. Carbon dioxide is a chemical compound of carbon and oxygen with the empirical formula CO2. In high concentrations this gas can be toxic to humans. Outside there is a CO2 value of around 450 ppm (part per million). In closed rooms, especially in winter, the value can increase significantly. Carbon dioxide dissolved in the blood activates the breathing center of the brain in a physiological and slightly increased concentration, which means that the brain receives too little oxygen. This is a common occurrence in closed rooms, you get tired and get severe headaches. For values below 800 ppm the air quality is rated as good, values between 800 and 1500 ppm are considered moderate and above 1500 ppm the indoor air quality is considered low. Then at the latest you should ventilate. When I was trading I often forgot about that and it made me tired, unable to concentrate and got a headache more quickly. For this I bought a CO2 measuring device that informs me about the current values at any time and even warns me acoustically above a certain limit value. The test winner at Stiftung Warentest is available from 70 €, an investment that has paid off for me. Since then, my concentration has increased and headaches are a thing of the past.

One of the main reasons for migraines and headaches is dehydration. No wonder, because the brain consists of 95% water. The next time you have a headache attack, it is better to drink a liter of water than to take the pain reliever immediately. We often confuse feelings of hunger and thirst and eat instead of drinking. It can be seen that the cravings are significantly less if you drink enough throughout the day. Our synovial fluid decreases over time. This can result in disc problems, rheumatism, arthritis and back pain. Having enough water keeps our joints supple. Water brings us more beautiful skin because our metabolic processes function optimally. This means that more nutrients can be transported into the cells. When trading, you often forget to drink, which is why my cell phone reminds me every hour to drink a glass of water. So I get around 2.5 liters of water per day. The result: more energy and improved performance, which we need when trading.

With all the contradicting dietary recommendations, one often no longer knows what to eat. Healthy nutrition means: Enjoying a variety of foods! The top priority of a healthy diet is and remains: Eat varied and mainly plant-based foods. The more varied the diet, the lower the risk of deficiency symptoms. A healthy diet is extremely worthwhile. It not only provides you with all the nutrients you need to have enough energy for the day, but also a variety of vital substances that help you stay healthy or - if you are sick - get well again. The right diet has a direct effect on your well-being and your ability to concentrate.

Smoking is the most common cause of death in our industrialized countries, although there are still over 30% in Germany who smoke, but the number of smokers is declining. In 1990, 30% of the 12 to 17 year olds smoked, today it is only 10%. The side effects that smoking causes bring many other disadvantages as well. In addition to yellow fingers and teeth, the stench and annoyance from cigarette smoke is an unpleasant side effect. The nicotine in a cigarette increases the heartbeat by around 20-30%, i.e. a resting heart rate of 80 instead of 60. If you stop smoking and eat as much as before, you still gain weight. That is also logical, because an increased heartbeat leads to an increased consumption of calories. When I stop smoking, the increased heart rate is automatically reduced. In recent years, the e-cigarette has enjoyed great popularity. It's not healthy either, I cannot say whether it is healthier than smoking. According to some experts, the e-cigarette seems to contain fewer harmful substances than a conventional cigarette.It smells less and the cost is even 10 times less. If used correctly, the e cigarette can be a slow way to quit smoking, as you can change the nicotine content individually. Interesting that the big cigarette manufacturers first railed against e cigarettes and are now selling e cigarettes themselves. If you stop smoking, you will not only relieve your lungs, but also your heart.

Most traders pursue their activities on the stock exchange as a part-time job, which means that they have a busy main job and use their free time to learn to trade. A full-time trader obviously spends more time in front of the screens, either sitting all day or standing in front of a high table. Neither is good for our spine, because just walking or lying down ensures an even distribution of our body weight. Changing the sitting position also only provides a short-term remedy. Either you use a treadmill when trading, which is not very practical, or you put your legs on the desk, because raised legs are good for blood circulation. The right desk chair is also crucial. I myself use a typical gamer's chair, the prices for a good office chair are between 150 and 1000 €. You can find suitable reviews on the Internet.

By the way, people spend a third of their lives in bed, which is why I recommend you invest in this area in particular. The right mattress, pillow and duvet is the key to the right relaxation in order to be fit the next day. A very good mattress with 7 lying areas is not expensive. With a duvet, the heat distribution is crucial and the pillow should optimally support the neck. Find out more about it on the Internet. I have been using a sleep app for many years, which informs me about the most important factors in my sleep. Of course, it is clear to me that this information can only be approximate. Nevertheless, you can compare them with each other. Over the years, I was able to try out different scenarios in order to be optimally rested the next morning. I sleep much better when I have eaten less in the evening and exercised enough during the day. Then the next day I am much more concentrated and also more successful. It doesn't always have to be the expensive Apple Watch, there are also cheaper providers such as Fitbit, with which you can also make calls, the battery even lasts for a week and does not have to be charged every day. Of course, these fitness watches also record all sporting activities, which can then be evaluated individually. Whether walking, jogging, cycling, swimming, fitness or bodybuilding, what the right sport is, everyone has to decide for themselves. The only important thing is regular exercise in order to stay fit in the long term. According to the experts, you should take at least 17,000 steps a day, the average for German citizens is just 4,000 steps. Nevertheless, you can always do something preventive for your health.

The reason why many traders cannot break away from their screens is the fear of missing out. As a full-time trader, you should take regular breaks, especially after a previously defined series of losses. I've found a good solution to this and it's called OBS. This is a screen recording program that records all of my trading screens in my absence. This means that I can precisely analyze these times when I was not in front of the screen, even on the weekend. Incidentally, the program is free and can of course record in 4K. Part-time traders in particular can use it to record the market on a daily basis during their absence and analyze the market in their free time. The advantage is that everyone can watch the crucial trading hours without having to sit in front of the screen all day. If you feel like showing your heartbeat on your screen while trading, you can master this challenge with OBS. You may need a suitable fitness watch or a Bluetooth chest strap for this. It is also interesting to mention that the more trades a trader has made, the lower his heart rate will be when he places a trade. So it's just a matter of regular practice. Information on how to connect OBS to your fitness watch can be found in this post on Youtube.

Another headache factor has to do with our eyes, which are focused on the screen throughout the day. The older you get, the more common these headaches become. This has to do with the muscles in the eye that are responsible for focusing visual acuity. Presbyopia begins at the age of 45 and affects many people. Many years ago I had multifocal lenses inserted, now I can see 100% in both eyes until the end of my life. At the age of 57 I can recognize the smallest letters on my cell phone and even sit in front of the screen for up to 15 hours without having trouble concentrating or having a headache. A lot of things related to health can be found in the blood. The most important are, liver values, blood lipids, C-reactive protein, iron, blood sugar, total protein, uric acid and thyroid hormones. The small blood count determines the most important cell classes in the blood such as red and white blood cells, platelets or the red blood pigment (hemoglobin). The more complex "complete blood count" also contains a subdivision of the white blood cells. I would recommend checking these with your family doctor at certain intervals. This will prevent many future problems.

I am neither an extreme athlete, nor a vegan or vegetarian, but I try to eat healthily within a reasonable framework and do enough exercise. From my point of view, the most important thing is to drink enough water every day as it detoxifies our body. I rarely drink alcohol, maybe 1-2 glasses of wine a week. As a seconds scalper in algorithm trading, I complete up to 30 trades a day, for this I have to be absolutely focused and fit at my age. Trading is a passion for me, but not an addiction. I measure my success by strict adherence to my trading plan, not by the size of my trading profits. Since I am usually between 1-3 minutes in the trade, I have 1 hour of trading time per day. I invest the rest of the time on projects in order to generate even deeper market insights. Balance is the decisive goal, I try to avoid the factor "too many" or too few" and try to find a healthy middle ground if possible. Of course, I don't always succeed, but in the end the will is what counts. If you can't do what you want, you have to want what you can. Because to want what one cannot do, would indeed be unwise.



I wish you every success that you achieve your goals in the future.

Kind regards Michael

Big player in the stock, forex and futures markets



Hello dear traders,


In today's post we talk about the biggest big players in the stocks forex and futures market. We look at the corresponding sales of the various assets and compare them with one another. Where are the biggest big players and why are they not so easy to identify in certain markets? Why is there a higher probability of winning in one market than in the other and how can you reduce your liability risk? Why do some big players avoid certain markets? These are just a few of the questions we are dealing with today




The video is of course produced in 4K again and you can have the spoken text translated into English on YouTube. Of course I will translate the text for you later and post it here tomorrow at the latest.


I wish you a lot of fun watching it and a nice and relaxing weekend.


Greetings Michael

Hello dear subscribers

At this point I would like to thank you all again for your great support, your great ideas and opinions. I am very proud that there are so many great people on this blog who are ready to help others. Thanks a lot for this.

I wish you all a great weekend and continued success in retail.