The fairy tale in the future market
Hello dear traders,
As we know, there is significantly less information in the Forex market than in the futures or stocks markets. In addition to the well-known footprint charts, there is volume information, iceberg tracker, pulling and stacking as well as the DOM and the time and sales list. According to the trading coaches, this is unbeatable information that allows you to see exactly where the big players are, bringing incredible returns to every retailer. Provided that you book an inexpensive trading seminar worth €10,000.
Around 1 million traders worldwide trade in the futures and stock markets and 5 million in the foreign exchange market. This means 15% trade on the stock market and 85% trade in the foreign exchange market. Statements like the futures market is the largest market in the world, only professionals trade in the futures market or on the stock exchange it is fairer are statements that are aimed solely at badmouthing the Forex market. Let's take a quick look behind the scenes and see to what extent this future data is actually helpful.
In volume trading we can look at vertical or horizontal trading volume. Both representations are calculated by adding market sell and market buy orders. But interestingly, the market sell order has nothing to do with a market buy order because they never meet in the market. The trading coaches then like to say that this high volume shows that a battle has taken place between large market participants. This is also complete nonsense, as the big players rarely fight with each other.
First of all, the big players collect the contracts they need with limit orders and use the retailers' stops. A high volume indicates a possible collection campaign, but the crucial question is: What was collected in this sideways phase and very few coaches have an answer to that. According to the law of causality, volume is just another type of pattern that also only arises by chance. By the way, it might be interesting that the big players are not interested in the volume because they produce it themselves.
For a retail trader who has previously traded in the foreign exchange market, the many flashing lights and numbers within a footprintchart are of course a small sensation. The trading coach now says that you can use these numbers to see exactly what these big players are up to. And if you know what someone else is planning, you can of course position yourself accordingly. But these are also just random assumptions, since as we already know, a market sell order has nothing to do with a market buy order and they never meet in the market.
Imbalance is also a very popular topic. If there is a strong deviation in the orders between best ask and best bid, this imbalance can be made visible in the market. This imbalance should act like a strong resistance zone. Unfortunately, these zones only work 30% of the time. In addition, the spread is often more than one tick large, which means that the assignment of best ask and best bid is no longer correct.
Dom Trading is also said to be true miracles. Ultimately, limit orders are a glimpse into the future, as this is where market participants show their willingness to enter into a trade. But is that really true? Unfortunately not, because by pulling or stacking a market participant is able to delete this limit order or add more at any time.
In the Time and Sales list you can see exactly which market orders are coming in. These orders are true, but it is not possible to see with what intention this market order was placed. A market buy order can mean an entry into the euro or an exit from the dollar. Likewise, a market sell order can show an entry into the dollar or an exit from the euro. Furthermore, these market orders come randomly and unexpectedly just like pulling or stacking.
The so-called iceberg trackers are particularly popular, with which you can see exactly where and when a large market participant absorbs. The fact is that native iceberg orders can be clearly identified, but synthetic iceberg orders cannot. And the largest proportion of iceberg orders are in the synthetic area. Even if you could predict absorption 100% correctly, you still don't know where the price will go after that.
The causality principle describes that the cause of the market movement depends exclusively on the market orders that flow into the limit orders. The result in the end is the price as well as the candle, which only ever arises randomly. This means that the volume of the footprint charts and the imbalance always only arise by chance. The same applies to the T&S list and the DoM.
The decisive movements that influence the market are the stops of the retailers and the orders that mainly slow down the market are the synthetic iceberg orders. And it is precisely these two types of orders that cannot be identified because we cannot see them. Of course, a future trader has more information than a Forex trader, but he can do just as much with it as a Forex trader can do with a candle.
And it is precisely for this reason that the world champions in Forex have beaten the world champions in futures 3 times in the last 5 years. So don't be fooled and continue trading in the Forex market, because due to many events, beginners in particular can lose up to 50 times less money than in the futures market. As a trader you always have to ask yourself the following question. Where can I achieve the most return with the least risk and also have a high probability of keeping it? And the answer is: definitely in the Forex market.
If you're smart, you can of course get the stock market data from the futures market to get additional information. However, I would generally only trade in the Forex market. You can find further information about this in my numerous videos.
I keep my fingers crossed for you and look forward to seeing you here again soon.
Kind regards, Michael
Hello dear traders,
As we know, there is significantly less information in the Forex market than in the futures or stocks markets. In addition to the well-known footprint charts, there is volume information, iceberg tracker, pulling and stacking as well as the DOM and the time and sales list. According to the trading coaches, this is unbeatable information that allows you to see exactly where the big players are, bringing incredible returns to every retailer. Provided that you book an inexpensive trading seminar worth €10,000.
Around 1 million traders worldwide trade in the futures and stock markets and 5 million in the foreign exchange market. This means 15% trade on the stock market and 85% trade in the foreign exchange market. Statements like the futures market is the largest market in the world, only professionals trade in the futures market or on the stock exchange it is fairer are statements that are aimed solely at badmouthing the Forex market. Let's take a quick look behind the scenes and see to what extent this future data is actually helpful.
In volume trading we can look at vertical or horizontal trading volume. Both representations are calculated by adding market sell and market buy orders. But interestingly, the market sell order has nothing to do with a market buy order because they never meet in the market. The trading coaches then like to say that this high volume shows that a battle has taken place between large market participants. This is also complete nonsense, as the big players rarely fight with each other.
First of all, the big players collect the contracts they need with limit orders and use the retailers' stops. A high volume indicates a possible collection campaign, but the crucial question is: What was collected in this sideways phase and very few coaches have an answer to that. According to the law of causality, volume is just another type of pattern that also only arises by chance. By the way, it might be interesting that the big players are not interested in the volume because they produce it themselves.
For a retail trader who has previously traded in the foreign exchange market, the many flashing lights and numbers within a footprintchart are of course a small sensation. The trading coach now says that you can use these numbers to see exactly what these big players are up to. And if you know what someone else is planning, you can of course position yourself accordingly. But these are also just random assumptions, since as we already know, a market sell order has nothing to do with a market buy order and they never meet in the market.
Imbalance is also a very popular topic. If there is a strong deviation in the orders between best ask and best bid, this imbalance can be made visible in the market. This imbalance should act like a strong resistance zone. Unfortunately, these zones only work 30% of the time. In addition, the spread is often more than one tick large, which means that the assignment of best ask and best bid is no longer correct.
Dom Trading is also said to be true miracles. Ultimately, limit orders are a glimpse into the future, as this is where market participants show their willingness to enter into a trade. But is that really true? Unfortunately not, because by pulling or stacking a market participant is able to delete this limit order or add more at any time.
In the Time and Sales list you can see exactly which market orders are coming in. These orders are true, but it is not possible to see with what intention this market order was placed. A market buy order can mean an entry into the euro or an exit from the dollar. Likewise, a market sell order can show an entry into the dollar or an exit from the euro. Furthermore, these market orders come randomly and unexpectedly just like pulling or stacking.
The so-called iceberg trackers are particularly popular, with which you can see exactly where and when a large market participant absorbs. The fact is that native iceberg orders can be clearly identified, but synthetic iceberg orders cannot. And the largest proportion of iceberg orders are in the synthetic area. Even if you could predict absorption 100% correctly, you still don't know where the price will go after that.
The causality principle describes that the cause of the market movement depends exclusively on the market orders that flow into the limit orders. The result in the end is the price as well as the candle, which only ever arises randomly. This means that the volume of the footprint charts and the imbalance always only arise by chance. The same applies to the T&S list and the DoM.
The decisive movements that influence the market are the stops of the retailers and the orders that mainly slow down the market are the synthetic iceberg orders. And it is precisely these two types of orders that cannot be identified because we cannot see them. Of course, a future trader has more information than a Forex trader, but he can do just as much with it as a Forex trader can do with a candle.
And it is precisely for this reason that the world champions in Forex have beaten the world champions in futures 3 times in the last 5 years. So don't be fooled and continue trading in the Forex market, because due to many events, beginners in particular can lose up to 50 times less money than in the futures market. As a trader you always have to ask yourself the following question. Where can I achieve the most return with the least risk and also have a high probability of keeping it? And the answer is: definitely in the Forex market.
If you're smart, you can of course get the stock market data from the futures market to get additional information. However, I would generally only trade in the Forex market. You can find further information about this in my numerous videos.
I keep my fingers crossed for you and look forward to seeing you here again soon.
Kind regards, Michael
Forget:That does not work, amateurs build the ark, pros the Titanic!
