Forex Grid Trading Overview: Practical Guide for 2025Forex Grid Trading Strategy: Detailed Overview & Low-Risk EUR/USD Application
1️⃣ What Is Grid Trading?
A grid trading strategy places a series of **buy** and **sell** orders at fixed intervals (“grid levels”) above and below a base price, without forecasting market direction. As price oscillates, it triggers orders across the grid, locking in small profits on each swing.
- **No Directional Bias** – Profits on both up- and down-moves
- **Automated Entry/Exit** – Ideal for Expert Advisors (EAs) on MT4/MT5
- **Scalable** – Grid size and lot sizing can be tailored to account size and volatility
2️⃣ How It Works – Core Components
1. **Grid Levels**
- Define a **base price** (e.g. current EUR/USD mid)
- Set **intervals** (e.g. every 20 pips) above/below the base
2. **Orders**
- **Buy Limit** orders at 20, 40, 60 pips below base
- **Sell Limit** orders at 20, 40, 60 pips above base
3. **Take Profit (TP) for Each Order**
- TP typically equals the grid interval (e.g. 20 pips) so each triggered order nets a small profit
- No hard Stop Loss per order—risk is managed via overall exposure
4. **Cumulative P&L**
- Winning trades roll profits into the floating drawdown of unfilled orders
- As price oscillates, the grid “locks in” incremental gains
3️⃣ Pros & Cons
| Pros | Cons |
|---------------------------------------|------------------------------------------|
| ✅ Profits in ranging markets | ❌ Can incur large drawdowns in strong trends |
| ✅ Automated, systematic execution | ❌ Requires significant margin for multiple open trades |
| ✅ Scalable to any time-frame | ❌ Floating negative exposure if grid one-sided |
---
✅Low-Risk Best Practices
1. **Grid Spacing & Width**
- Wider grid intervals (e.g. 30–50 pips) reduce order density and margin use
- Use **ATR** (Average True Range) to adapt spacing to EUR/USD volatility
2. **Lot Sizing & Equity Risk**
- Risk ≤ 1–2% equity per full grid cycle
- Use **fixed fractional** sizing: each order size = (Equity × 1%) / (max number of open grid orders)
3. **Drawdown Control**
- **Maximum Open Orders** cap (e.g. 5 orders per side)
- **Equity Stop-Out**: if floating drawdown exceeds e.g. 10% of equity, close all orders
4. **Trend Filters**
- Use a **200-period SMA** or **ADX** filter: only enable sell grid if price < SMA (downtrend) or ADX < 25 (low momentum)
- Disables grid in strong one-way trends
5. **Grid Shifting / Re-Base**
- After a net grid profit, **shift** the base price to current mid to reset exposure
- Prevents runaway open trades far from current price
5️⃣ Step-by-Step: Applying to EUR/USD
1. **Choose Time-Frame**
- **H4 or H1** recommended: balances signal frequency and margin needs
2. **Define Grid Parameters**
- **Base Price:** current EUR/USD mid (e.g. 1.0980)
- **Interval:** 30 pips (≈ recent ATR on H4)
- **Levels:** 3 buys at 1.0950 / 1.0920 / 1.0890; 3 sells at 1.1010 / 1.1040 / 1.1070
3. **Set Order Size**
- Account equity $10 000, risk 1% = $100 per full grid
- Max open orders 6 → each order $100/6 ≈ $16.7 → ≈ 0.02 lots
4. **Configure TP & No SL**
- Each order TP = 30 pips (equals interval)
- No per-order SL; overall drawdown managed by equity stop
5. **Implement Filters**
- Only open **sell** grid if H4 close < 200-SMA; only open **buy** grid if H4 close > 200-SMA
- Pause grid if ADX > 30 (strong trend) or market events (e.g. NFP, ECB rate decision)
6. **Deploy & Monitor**
- Run on MT4 with an EA or semi-automated Expert Advisor
- Monitor margin usage; adjust grid or disable before major news
6️⃣ Example P&L Mechanics
| Trigger Price | Order Type | Entry | TP Target | Profit (pips) |
|---------------|------------|---------|-----------|---------------|
| 1.0950 | Buy Limit | 1.0950 | 1.0980 | 30 |
| 1.0980 | Sell Limit | 1.0980 | 1.1010 | 30 |
- If price moves down to 1.0950: buy executes, TP at 1.0980 nets +30 pips
- If price then climbs above base, sells trigger at 1.1010 nets +30 pips
2️⃣ Introducing Progressive & Regressive Scaling
🔼 2.1 Progressive Scaling
“Let winners run”—increase exposure after success
Concept: After each profitable grid cycle, step up your lot size by a fixed increment.
Why: Capitalizes on momentum and winning streaks.
How to apply:
Base Lot: 0.02 lots per order (1% equity risk).
After grid closes net-positive, next cycle = 0.03 lots.
Continue stepping up (0.04, 0.05 …) until a drawdown or equity-stop is hit.
Reset back to base lot after a losing cycle or whenever floating drawdown > 5%.
Caps & Safeguards:
Max Lot Cap: Never exceed 0.10 lots (or 2% equity risk).
Equity Stop: If floating drawdown > 10%, close cycle & reset.
🔽 2.2 Regressive Scaling
“Protect the downside”—reduce exposure after losses
Concept: After a losing grid cycle, step down your lot size to conserve capital.
Why: Limits damage during rough periods and preserves margin.
How to apply:
Base Lot: 0.02 lots per order.
If grid hits equity-stop or nets negative, next cycle = 0.015 lots.
Continue stepping down (0.01, 0.005) until you record a net-positive cycle.
Reset to base lot after recovery (e.g. two consecutive winning cycles).
Thresholds:
Don’t drop below 0.005 lots (to avoid over-shrinking).
After two winning cycles at reduced lot, return to base.
✅ Bottom Line
Forex grid trading on EUR/USD can generate steady gains in choppy markets—but demands **strict risk controls** (grid spacing, lot sizing, drawdown limits) and **trend filters** to avoid large losses in trending conditions. When properly applied, a low-risk grid on EUR/USD offers a robust, mostly hands-off strategy for capturing repetitive market swings.
4️⃣ Key Takeaways
Progressive Scaling lifts lot sizes on winning streaks, amplifying gains—but must be capped and reset on losses.
Regressive Scaling shrinks exposure after drawdowns, preserving capital until the strategy recovers.
Combine both with your grid’s risk parameters, trend filter, and a solid equity-stop to maintain a balanced, low-risk EUR/USD grid.
By layering scaling rules atop your grid, you adapt dynamically to market performance—maximizing winners and protecting against prolonged losing runs. Good luck! 🚀
Community ideas
Learn the Harsh Truth About Success & Failure in Trading
The picture above completely represents the real nature of trading:
We all came here because we all wanted easy money.
Being attracted by catchy ads, portraying the guys on lambos, wearing guccies and living fancy lives, we jump into the game with high hopes of doubling our tiny initial trading accounts.
However, the reality quickly kicks in and losing trades become the norm.
The first trading account will most likely be blown .
In just one single month, 40% of traders will be discouraged and abandon this game forever.
The rest will realize the fact that the things are not that simple as they seemed to be and decide to start learning.
The primary obstacle with trading education though is the fact that there are so much data out there, so many different materials, so many strategies and techniques to try, so the one feels completely lost .
And on that stage, one plays the roulette: in the pile of dirt, he must find the approach that works .
80% of the traders, who stay after the first month, will leave in the next 2 years. Unfortunately, the majority won't be able to find a valid strategy and will quit believing that the entire system is the scam.
After 5 years, the strongest will remain. The ones that are motivated and strong enough to face the failures.
With such an experience, the majority of the traders already realize how the things work. They usually stuck around breakeven and winning trades start covering the losing ones.
However, some minor, tiny component is still missing in their system. They should find something that prevents them from becoming consistently profitable.
Only 1% of those who came in this game will finally discover the way to make money. These individuals will build a solid strategy, an approach that will work and that will let them become independent .
That path is hard and long. And unfortunately, most of the people are not disciplined and motivated enough to keep going. Only the strongest ones will stay. I wish you to be the one with the iron discipline, titanic patience and nerves of steel.
❤️Please, support my work with like, thank you!❤️
I am part of Trade Nation's Influencer program and receive a monthly fee for using their TradingView charts in my analysis.
Trading Psychology Trap: The Dark Side of Hedging a Bad Trade⚡ Important Clarification Before We Begin
In professional trading, real hedging involves sophisticated strategies using derivatives like options, futures, or other financial instruments.
Banks, funds, and major institutions hedge to manage portfolio risk, based on calculated models and complex scenarios.
This article is not about that.
We are talking about the kind of "hedging" retail traders do — opening an opposite position at the broker to "protect" a losing trade.
It may feel smart in the moment, but psychologically, it can be a hidden trap that damages your trading discipline.
Let’s dive into why emotional hedging rarely works for independent traders.
________________________________________
In trading, there’s a moment of panic that every trader has faced:
"My short position is in the red… maybe I’ll just open a long to balance it out."
It feels logical. You’re hedging. Protecting yourself. But in reality, you might be stepping into one of the most deceptive psychological traps in trading.
Let’s unpack why emotional hedging is rarely a good idea—and how it quietly sabotages your progress.
________________________________________
🧠 1. Emotional Relief ≠ Strategic Thinking
Hedging often arises not from a solid strategy, but from emotional discomfort.
You don’t hedge because you’ve analyzed the market. You hedge because you can’t stand the pain of a losing position.
This is not trading.
This is emotional anesthesia.
You’re trying to feel better—not trade better.
________________________________________
🎭 2. The Illusion of Control
Opening a hedge feels like taking back control.
In reality, you’re multiplying complexity without clarity.
You now have:
• Two opposing positions
• No clear directional bias
• An unclear exit strategy
You’ve replaced one problem (a loss) with two: mental conflict and strategic confusion.
________________________________________
🎢 3. Emotional Volatility Rises Sharply
With two positions open in opposite directions:
• You root for both sides at once.
• You feel relief when one wins, and stress when the other loses.
• Your mind becomes a battleground, not a trading desk.
This emotional volatility leads to irrational decisions, fatigue, and trading paralysis.
________________________________________
🔄 4. You Delay the Inevitable
When you hedge a losing position, you don’t fix the mistake.
You prolong it.
Eventually, you’ll have to:
• Close one side
• Add to one side
• Or exit both at the wrong moment
Hedging here is just postponed decision-making—and it gets harder the longer you wait.
________________________________________
🧪 5. You Build a Dangerous Habit
Hedging out of fear creates a reflex:
"Every time I’m losing, I’ll hedge."
You’re not learning to cut losses or reassess your strategy.
You’re learning to panic-protect.
And over time, you start to rely on hedging as a crutch—rather than developing real confidence and discipline.
________________________________________
✅ The Healthier Alternative
What should you do instead?
• Cut the loss.
• Review the trade.
• Wait for a fresh setup that aligns with your plan.
Accepting a losing trade is hard. But it’s a sign of maturity, not weakness.
Hedging may feel clever in the moment, but long-term consistency comes from clarity, not complication.
________________________________________
🎯 Final Thought
Emotional hedging isn’t about strategy.
It’s about fear.
The best traders don’t hedge to escape a loss.
They manage risk before the trade starts —and have the courage to close what’s not working.
Don’t fall into the illusion of safety.
Master the art of decisive action. That’s where real edge lives. 🚀
Serios Traders Trade Scenarios, Not Certaintes...If you only post on TradingView, you're lucky — moderation keeps discussions professional.
But on other platforms, especially when you say the crypto market will fall, hate often knows no limits.
Why?
Because most people still confuse trading with cheering for their favorite coins.
The truth is simple:
👉 Serious traders don't operate based on certainties. They work with living, flexible scenarios.
In today's educational post, I'll show you exactly how that mindset works — using a real trade I opened on Solana (SOL).
________________________________________
The Trading Setup:
Here’s the basic setup I’m working with:
• First sell: Solana @ 150
SL (stop-loss): 175
TP (take-profit): 100
• Second sell: Solana @ 160
SL: 175
TP: 100
I won’t detail here why I believe the crypto market hasn’t reversed yet — that was already explained in a previous analysis.
Today, the focus is how I prepare my mind for different outcomes, not sticking to a fixed idea.
________________________________________
The Main Scenarios:
Scenario 1 – The Pessimistic One
The first thing I assume when opening any position is that it could fail.
In the worst case: Solana fills the second sell at 160 and goes straight to my stop-loss at 175.
✅ This is planned for. No drama, no surprise. ( Explained in detail in yesterday's educational post )
________________________________________
Scenario 2 – Pessimistic but Manageable
Solana fills the second sell at 160, then fluctuates between my entries and around 165.
If I judge that it’s accumulation, not distribution, I will close the trade early, taking a small loss or at breakeven.
________________________________________
Scenario 3 – Mini-Optimistic
Solana doesn’t even trigger the second sell.
It starts to drop, but stalls around 120-125, an important support zone as we all saw lately.
✅ In this case, I secure the profit without waiting stubbornly for the 100 target.
Important tactical adjustment:
If Solana drops below 145 (a support level I monitor), I plan to remove the second sell and adjust the stop-loss on the initial position.
________________________________________
Scenario 4 – Moderately Optimistic
Solana doesn’t fill the second order and drops cleanly to the 100 target.
✅ Full win, perfect scenario for the first trade
________________________________________
Scenario 5 – Optimistic but Flexible
Solana fills the second sell at 160, then drops but gets stuck at 120-125(support that we spoken about) instead of reaching 100.
✅ Again, the plan is to close manually at support, taking solid profit instead of being greedy.
________________________________________
Scenario 6 – The Best Scenario
Solana fills both sell orders and cleanly hits the 100 target.
✅ Maximum reward.
________________________________________
Why This Matters:
Scenarios Keep You Rational. Certainties Make You Fragile.
In trading, it's never about being "right" or "wrong."
It's about having a clear plan for multiple outcomes.
By thinking in terms of scenarios:
• You're not emotionally attached to a single result.
• You're prepared for losses and quick to secure wins.
• You're flexible enough to adapt when new information appears.
Meanwhile, traders who operate on certainties?
They get blindsided, frustrated, and emotional every time the market doesn’t do exactly what they expected.
👉 Trading scenarios = trading professionally.
👉 Trading certainties = gambling with emotions.
Plan your scenarios, manage your risk, and stay calm. That's the trader's way. 🚀
Position Sizing – “Size Kills, or Saves”🎯 Position Sizing – “Size Kills, or Saves”
"A great setup with the wrong size is a disaster in disguise."
🧭 What’s Position Sizing, Really?
It’s not just how much you’re willing to trade.
It’s how much you’re willing to lose.
Most traders obsess over entries, patterns, and predictions.
But behind every blown account isn’t a bad signal—it’s a bad position size.
The wrong size magnifies every mistake.
The right size lets you survive long enough to learn, adapt, and win.
🔍 The Silent Risk
Let’s say you risk 10% of your account on each trade.
A few losses in a row can wipe you out—not just financially, but emotionally.
Here’s what happens after 5 consecutive losses:
Now ask yourself:
💭 Which version of you makes better decisions?
🔹The one who’s lost 5%…
🔹Or the one who’s lost 41% and is desperately trying to “get it back”?
🧠 Why Fixed % Risk Works
The pros don’t let emotions set their size. They use logic and math .
The rule?
📏 Risk no more than 1%–2% of your total capital per trade , based on your stop-loss.
It’s not conservative—it’s sustainable .
This lets you endure rough patches and stay in the game long enough for your edge to play out.
🛠 How To Size Like a Pro
Let’s walk through an example:
1. Know your capital
You have $10,000 in your trading account.
2. Decide how much you're willing to risk
Professional traders risk a small percentage per trade, usually 1%.
That means:
1% of $10,000 = $100
This is the maximum amount you’re willing to lose on this trade.
3. Set your stop-loss (as a percentage)
Let’s say you’re buying a coin (Cryptocurrency) at $100, and your stop-loss is at $95.
That’s a 5% stop-loss, because:
(100 - 95) ÷ 100 = 0.05 = 5%
4. Use the formula to calculate your position size
🧮 Position Size = Risk $ ÷ % Stop-Loss
Here’s the math:
$100 ÷ 5% = $2,000
That means you can buy $2,000 worth of that coin (Cryptocurrency).
So at a $100 price, you’d buy 20 units.
💬 Important Note
If the stoploss is hit, you will only lose 1% (i.e., $100) of your capital, regardless of the stoploss size.
However, if the trade wins, the profits are proportional to how big your position size is relative to the stop-loss distance.
Thus, your risk-to-reward ratio improves naturally, and you maintain strict control over your downside while allowing your upside to grow.
💡 Simple Rule of Thumb
➤ Smaller stop-loss = larger position
➤ Larger stop-loss = smaller position
The goal is to keep your $ risk fixed, not the size of your trades.
📌 Why this matters:
Sizing by stop-loss respects volatility and makes your risk consistent, no matter how different the trades are.
🔥 Mistakes to Avoid
❌ Don’t size based on “how sure” you are. Confidence isn’t consistency.
❌ Don’t adjust size mid-trade. Let the stop-loss manage risk, not your panic.
❌ Don’t double down to recover losses. It’s not strategy—it’s revenge.
📌 Action Tip
👉 Start tracking your risk% per trade in your journal.
👉 Use position size calculators — they’re free, fast, and accurate.
👉 Make size a system. Not a feeling.
🧘 Final Thought
Your strategy might give you an edge.
But your position sizing is what protects it.
If strategy is offense, size is defense, and defense wins championships.
CTMI Strategy Spots $TSLA Trend Early: +86.77% Win!
The CTMI Strategy v2.0 - Premium Access secured a massive +86.77% profit on Tesla, Inc. ( NASDAQ:TSLA ) with an automated long trade from $235.7 to $441.09! 📈 Now showing a “Hold” signal at $284.95 with a projected price of $165.2 ( -42.1% ), this trade highlights how CTMI automatically manages entries and exits for you.
How to Win with CTMI Strategy v2.0 - Premium Access:
• Automated Entries: CTMI automatically triggered a LONG Entry at $235.7, spotting a “Strong Uptrend” early. Look for similar setups with strong signal alignment.
• Automated Exits: CTMI automatically executed a LONG Exit at $441.09 as indicators turned bearish (RSI: Bear, MACD: Bear), locking in profits before the downturn. Trust CTMI to handle exits for you.
• Use Key Levels: Resistance 1 ($444.24) and Support 1 ($169.95) guide your trade—CTMI uses these to optimize entries and exits.
Let CTMI automate your wins!
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Technical Analysis Indicators Cheat SheetHello, traders! 🦾
This cheat sheet provides a comprehensive overview of the most widely used technical analysis indicators. It is designed to support traders in analyzing trends, momentum, volatility, and volume.
Below, you’ll find a handy screenshot of this Cheat Sheet that you can save and peek at whenever you need a quick, friendly refresher on your trading indicators. ;)
1. Trend Indicators
These tools identify the direction and strength of price movements, critical for trend-following strategies.
Moving Averages (MA)
Simple Moving Average (SMA) and Exponential Moving Average (EMA) smooth price data to highlight trends. Crossovers (e.g., 50-day vs. 200-day MA) signal potential trend shifts.
MACD (Moving Average Convergence Divergence) – Tracks the difference between two EMAs, paired with a signal line to generate trade signals. A bullish crossover occurs when MACD rises above the signal line.
Parabolic SAR. Places dots above or below the price to indicate trend direction. Dots below the price suggest an uptrend; above, a downtrend.
ADX (Average Directional Index)
Measures trend strength (0–100). Values above 25 confirm a robust trend; below 20 indicate consolidation.
2. Momentum Indicators (Oscillators)
These indicators assess price movement speed and highlight overbought or oversold conditions.
RSI (Relative Strength Index)
Ranges from 0 to 100, with values above 70 indicating overbought conditions and below 30 indicating oversold. The divergence between the RSI and price can signal impending reversals.
Stochastic Oscillator –Compares closing price to the price range over a period (0–100). Above 80 is overbought; below 20, oversold. %K and %D line crossovers provide precise trade signals.
CCI (Commodity Channel Index) – Measures price deviation from its average. Readings above +100 indicate overbought; below -100, oversold.
Williams %R – Similar to Stochastic, it measures distance from the period’s high (0 to 100). Above -20 is overbought; below -80, oversold.
3. Volatility Indicators
These tools quantify price fluctuation ranges to optimize trade timing.
Bollinger Bands – Comprises a 20-day SMA and two bands (±2 standard deviations). Narrow bands reflect low volatility; wide bands indicate high volatility. A price touching the outer bands may signal a reversal or trend continuation, depending on the context.
ATR (Average True Range) – Calculates the average price range over a period to gauge volatility. Higher ATR values denote greater market movement.
4. Volume Indicators
Volume-based indicators validate price movements and highlight market participation.
OBV (On-Balance Volume) – Cumulates volume to confirm price trends. The rising OBV, alongside rising prices, supports an uptrend. OBV divergence from price may foreshadow reversals.
Volume Oscillator – Compares two volume moving averages to evaluate buying or selling pressure. Positive values suggest stronger buying. It typically confirms breakouts or assesses the sustainability of a trend.
Chaikin Money Flow (CMF) – It analyzes money flow based on price and volume. Positive CMF indicates buying pressure; negative, selling pressure.
5. Other Key Indicators. Advanced Tools for Deeper Market Analysis.
Ichimoku Cloud – Combines five lines and a “cloud” to assess trend, momentum, and support/resistance. Price above the cloud signals an uptrend; below, a downtrend. Cloud thickness reflects the strength of support or resistance levels.
Fibonacci Retracement – Maps potential support and resistance using Fibonacci ratios (23.6%, 38.2%, 50%, 61.8%).
Pivot Points – Derives support (S1, S2) and resistance (R1, R2) levels from the prior period’s high, low, and close.
Skills to Sharpen for Smarter Trading
Successful traders often find that combining indicators from different categories yields better results. For instance, pairing a trend-based EMA with a momentum indicator like RSI can help confirm signals more reliably — much like crafting the perfect coffee blend, where balance is everything.
Many also realize that stacking similar tools, such as using both RSI and Stochastic, tends to clutter the picture rather than clarify it. A focused set of indicators usually proves more effective.
Another common practice is backtesting setups on historical data to understand how strategies perform in specific markets and timeframes. It’s a way to rehearse before stepping onto the stage.
Ultimately, those who see consistent results tend to integrate indicators into a coherent strategy rather than reacting to every signal. That clarity often makes all the difference
Many of these indicators, from MACD to Bollinger Bands, are readily available on platforms like TradingView, making it easy to apply them to your charts.
Subscribe and let us know which of these indicators intrigues you the most so we can explore it further in our next post!
Good luck! 👏
Gold and Chart Patterns I’m dropping this XAU/USD M30 insight because my system’s a damn executioner, and you need to see how I hunt the market. This chart is a textbook of bearish patterns—first a bearish three drives showing smart money exhausting buyers with three weakening upward pushes, then a head and shoulders with the neckline break confirming the reversal, and now a bearish shark forming to seal the deal, all playing out within my descending trendlines. Smart money’s been in control from the start, distributing at the peaks, grabbing liquidity, and dumping price to hunt stop-losses below key levels. Supply and demand zones are my edge—supply at the right shoulder of the head and shoulders where sellers stacked orders before the break, demand near the lower trendline where buyers might step in, my target for this bearish move. My checklist operations are a predator’s playbook. I start with harmonic patterns, hunting XABCD structures like the bearish shark I’m seeing now, signaling smart money’s reversal zones. I confirm market structure, looking for breaks of structure to show trend shifts—here, the neckline break confirms bearish continuation. I identify order blocks, those consolidation zones where smart money stacks orders, like the bearish order block at the right shoulder where sellers distributed. Volume profile is key—I check for high volume nodes where price stalls, like the neckline where sellers defended, and low volume nodes that act as magnets, like gaps below the neckline. Top-down analysis keeps me sharp—four-hour timeframe sets the bearish trend, one-hour confirms the break, thirty-minute narrows the setup, fifteen-minute is my strike zone, waiting for a neckline retest. I use Heikin Ashi for confirmation—red candles mean sell, waiting for red on the fifteen-minute at the retest. Fibonacci levels mark my targets—I focus on key extensions to set exits, like targeting the lower trendline of the channel. Gann theory adds confluence—I look for angles or retracements to align with my setups, like a Gann angle pointing to the lower trendline. MACD and RSI measure momentum—MACD’s bearish crossover and negative histogram confirm the downtrend, RSI below fifty with bearish divergence at the right shoulder seals it. Risk management is my law—I risk small to win big, stop-loss above the right shoulder, take-profit at the lower trendline, aiming for a high reward ratio. I monitor news and liquidity traps—fake spikes above the neckline are smart money’s tricks, so I stay sharp. I wait for confirmation—every piece aligns, or I walk, then I document to keep my edge razor-sharp. I’m rating this system a ten out of ten—harmonic patterns, Smart Money Concepts, volume profile, top-down analysis, and now MACD and RSI for momentum make it untouchable. I’ve fine-tuned this over six months, backtesting until it’s a weapon. I need two of you to join me at Academia—let’s hunt together.DYOR
Shieldsmine Diaries
Is the Crypto Market Broken ?It’s no secret — the crypto world isn’t what it used to be. A few years ago, it felt like an open frontier where anyone could jump in and strike gold. Today, the crypto space has changed dramatically. The market has become much more competitive , and the days of easy wins are largely behind us.
One of the biggest issues is manipulation. The crypto market is now heavily influenced by " whales who hold massive amounts of coins and have the power to move prices with a single trade. They can trigger panic selling or hype buying, all while positioning themselves to profit, often at the expense of smaller investors.
And that brings us to another hard truth: money in crypto tends to flow from the many to the few . Inexperienced and poorly informed traders often get caught up in hype or fear , making emotional decisions. Meanwhile, wealthy investors use strategy, patience, and insider knowledge to grow their holdings.
In short, while the crypto market isn’t necessarily “broken,” it’s definitely no longer a level playing field. If you’re thinking of jumping in, it’s more important than ever to stay educated, cautious, and aware of the forces at play.
BITSTAMP:BTCUSD COINBASE:BTCUSDT CRYPTOCAP:BTC.D CRYPTOCAP:TOTAL CRYPTOCAP:BTC
XAUUSD is ready to FALL below ? 3100through my weekly Episode multitime frame analysis , you will get deep insights .
Market in on rising channel since last year and did not respect the 2900 milestone after breaking it.
is it the time to retracement?
our eyes will be at 2980 milestone on this next 2weekly candles.
if market again surpass 3360 then ready for the next new ATH above 3500.
secondly if any h4,D1 close below 3360 stay bearish side and our setup
DXY BREAKOUT IN PLAY — Smart Money is Moving!After a clean falling wedge formation, DXY is showing early signs of bullish momentum.
Price action respects the trendline support + bullish orderblock (green zone) beautifully!
Next targets: 101.000 — 103.000 zone.
Watch for pullback entries before continuation.
This is textbook falling wedge breakout behavior — stay sharp!
Levels Marked:
Support: 99.00 zone
Target Zones: 101.000 & 103.000
Breaker structure: Confirmed bullish
Save this setup & be prepared!
Trader Psychology – The Battle Within🧠 Trader Psychology – The Battle Within
"Your biggest drawdown isn’t on your chart. It’s in your head."
Most traders begin their journey focused on charts, indicators, and strategies. But ask any seasoned trader, and they’ll tell you: the true game is mental.
Here’s the truth:
You can have the best system in the world, but if your mindset isn’t aligned, you’ll sabotage yourself every time.
Let’s break down three core emotional pitfalls:
1. Revenge Trading – Fighting the Market
After a loss, many traders feel the urge to “make it back” immediately. You take impulsive entries. You increase your position size.
You're no longer trading the market – you're trading your emotions.
This is how small losses become account-wrecking drawdowns.
✅Solution: Accept the loss. Step away if needed. Come back with logic, not emotion.
2. FOMO – The Trap of Urgency
The candle flies. Everyone’s posting wins. You feel behind.
You enter late. You ignore your plan. You trade what you want to see, not what’s actually happening.
FOMO leads to undisciplined trades, poor entries, and quick exits.
✅Solution: If you missed the move, you missed it. Let it go. Opportunities are infinite – your capital is not.
3. Overconfidence – The Silent Killer
You win a few trades. Confidence grows. Then ego steps in.
You start breaking your own rules. You size up. You stop managing risk.
The market humbles you.
✅Solution: Stay humble, even in winning streaks. Confidence is earned, but arrogance is punished.
Practical Application – Track Your Emotional State
In your trading journal, don’t just log entries and exits.
Track your mental state before and after each trade.
Examples:
🔹 Calm and focused → 🧘♂️
🔹 Doubtful and hesitant → 🤔
🔹 Overexcited → 🤪
🔹 Fearful → 😨
🔹 Seeking revenge → 😈
Patterns will emerge. You’ll start to notice that your best trades often come from a calm, neutral mindset , not when you’re emotionally charged.
📌Why This Matters
The chart doesn’t beat you. You beat yourself.
Mindset issues create most of the bad trades, not technical errors.
If you learn to manage your emotions, you instantly separate yourself from 90% of traders.
🧘Final Thought:
A calm trader outperforms a clever one.
Discipline is a strategy. Emotional control is your true edge.
Big Wins with CTMI: $META Soars +91.26%!The CTMI Strategy has delivered a solid performance on Meta Platforms, Inc. ( NASDAQ:META ) on a 1-week chart! 📈 A recent long trade from $371.9 to $712.72 yielded an impressive +91.26% return. However, the current signal suggests “Watch for Entry” with a trade confidence of 63.5% and a projected price of $500.2 (-9.1%).
How to Take Advantage & Profit:
• Monitor the Signal: The strategy indicates a “Pullback Up” with a Trend Score of 3/8. Wait for a stronger signal (e.g., “Buy Now” with confidence >85%) to enter a new trade.
• Use Key Levels: Resistance at $698.41 and support at $437.96 provide clear targets for planning entries and exits.
• Leverage Risk Management: The strategy’s built-in stop-loss and trailing stops help lock in gains and limit losses—stick to them!
• Stay Patient: With high volume and moderate risk, NASDAQ:META is on the watchlist. Watch for a confirmed trend to maximize profitability.
Try the CTMI Strategy to catch big moves like this! 💡 #Trading #META #CTMI #Profit
Trading mistakes and how to fix them. Part 2Today, I’m sharing something in a slightly different format.
The points below aren’t problems to solve — they are principles to remember.
They aren’t my personal inventions, though I fully agree with them and have made them a part of my trading approach.This is a curated collage of insights, recommendations, and lessons from experienced traders, drawn from books and years of practice.
1. Spreading yourself too thin by entering positions in too many assets at once.
For an investor, this is acceptable and even necessary. But not for a trader or speculator. Investors have different behavior patterns in the market and different reasons for buying certain assets.
Speculating is a much faster type of trading, and it’s simply impossible to keep track of too many assets in a portfolio. It's better to focus on 3–5 positions.
I know one very successful speculator who trades only one asset—and does so quite successfully. For me, he's a great example that if you know how to trade well, you can make decent money even on a single asset.
2. Switching to Other Timeframes.
If you entered a position on the 1-hour timeframe, then the entire trade — including stop-losses and take-profits — should be based on the 1-hour chart.
3. Trying to Predict Market Moves.
Everything you need to know is already on the chart. The chart is the best insider. Don't try to guess or gamble — that's not how money is made in this business. If you want to gamble, go to a casino. Before news or economic data is released, the market usually already shows patterns signaling a potential rise or fall.
The only exception is trading around genuinely major news events, like Trump’s tariffs — but you will usually hear about such events without even following news feeds. These are very powerful moves, and the real danger is not uncertainty about the direction, but extreme volatility. Often the first reaction to the news is false, and you might get stopped out prematurely. It's better to wait for confirmation — for the move to actually start.
For example, if you see all the signals on the chart suggesting a decline, but after the news the market shoots up, don't rush. If that entire upward move gets erased by a downward move and the price starts making new lows, _then_ you can open a short position.
Even better, wait until the next day. If the move is real, it won’t end in just one or two days.
4. A stock trading at a high price doesn’t mean it can’t go higher — and vice versa.
You shouldn't short a rising asset, just as you shouldn't buy a falling one. Just keep that in mind.
Success in trading comes not from winning every trade, but from focusing on high-probability setups.
Digital Asset Backed by Physical Gold: Gold ownership, redefined
In today’s rapidly evolving financial landscape, PAX Gold (PAXG) stands out as a compelling fusion of traditional asset security and blockchain-enabled efficiency. As an asset-backed token, PAXG represents ownership of real, physical gold — specifically, one fine troy ounce of a London Good Delivery gold bar held in fully insured, professional vault facilities.
What sets PAXG apart is its unique structure: anyone who holds the token has legal ownership rights to the underlying gold, which is securely managed under the custody of Paxos Trust Company — a regulated financial institution based in New York.
This digital asset offers a number of powerful advantages:
🔹 Physical ownership meets digital flexibility
PAXG gives investors the benefits of physical gold ownership with the speed, divisibility, and mobility of a blockchain-based token. Investors can hold fractional amounts of gold — something traditionally difficult or expensive to manage.
🔹 Efficient conversion and reduced settlement risk
Through the Paxos platform, users can seamlessly convert between PAXG, allocated or unallocated gold, and fiat currency. This efficient process significantly reduces settlement risk compared to traditional gold markets.
🔹 Liquidity and accessibility
PAXG is available for trading on Paxos’ itBit exchange and is also being integrated into a wide range of crypto exchanges, wallets, and DeFi platforms — expanding its reach and use cases within the digital asset ecosystem.
🔹 True market value
Since PAXG is fully backed by physical gold, its price is tied directly to the real-time market value of gold. This provides a reliable hedge against market volatility and inflation while maintaining the flexibility of a tokenized asset.
As the lines continue to blur between traditional finance and digital innovation, assets like PAX Gold are pioneering a new standard — one that merges trust, transparency, and technology. For investors seeking the security of gold and the utility of crypto, PAXG may just be the golden bridge.
Navigating Trump Tariffs on the Dow JonesNavigating the movements of the **US30 (Dow Jones Industrial Average)** can be challenging, especially amid shifting economic policies. The Dow, which tracks 30 major U.S. companies, is highly sensitive to trade policies, corporate earnings, and geopolitical risks. Trump’s plan to impose **10% across-the-board tariffs** and **60%+ tariffs on Chinese goods** has sparked concerns about inflation, supply chain disruptions, and retaliatory trade measures. Investors are closely watching how these policies could impact multinational companies within the index, particularly those reliant on global trade, such as **Boeing, Apple, and Caterpillar**.
For everyday Americans, higher tariffs could mean **rising prices on imported goods**, from electronics to household items, worsening inflation. While tariffs aim to protect domestic industries, they often lead to **higher production costs** for businesses that rely on foreign materials, potentially triggering job cuts or reduced consumer spending. The stock market’s reaction—volatility in the US30—reflects these uncertainties, as investors weigh the risks of slower growth against potential benefits for U.S. manufacturers.
Traders navigating the US30 must monitor **Fed policy, corporate earnings, and trade war developments**. If tariffs escalate, defensive stocks (utilities, healthcare) may outperform, while industrials and tech could face pressure. Long-term investors might see dips as buying opportunities, but short-term traders should prepare for turbulence. Ultimately, Trump’s tariff policies could reshape market dynamics, making adaptability key for those trading the Dow.
Geld Vision Investing with values — how ESG is changing More and more people today not only want to earn money, but also want to know where their money is going and what impact it is having . They want to invest in projects that are not only profitable, but also responsible and sustainable. This is precisely where the ESG investing approach comes into play—a concept in which returns and responsibility go hand in hand.
We explain in a simple and understandable way what ESG means, how it works and why this approach will become increasingly important in 2025.
What does ESG mean?
ESG stands for three central principles:
E — Environmental: Climate protection, CO₂ emissions, resource conservation, waste prevention
S — Social: fair working conditions, human rights, diversity and inclusion
G — Governance: Transparency, anti-corruption, ethical leadership
Companies with high ESG ratings try to act responsibly towards people, the environment and society.
Why invest in ESG?
ESG investing combines ethical values with economic rationality. The benefits are obvious:
Fewer risks. Companies with clear ESG policies are less likely to experience scandals or legal problems.
Long-term stability. Sustainable companies are more resilient to crises and more future-oriented.
Good reputation. Companies with strong values gain trust from customers and partners.
Political support. More and more countries are promoting sustainable economic activity.
The platform allows users to specifically search for ESG-compliant companies and funds and track their development.
ESG and returns – contradiction or win-win?
A common misconception: Companies that operate sustainably earn less. In fact, the opposite is often true.
Numerous studies show that ESG companies perform better in the long term because they:
be managed more efficiently,
respond better to crises,
Attract investors and talent more strongly,
be on the safe side from a regulatory perspective.
Sustainability and profit are not mutually exclusive – they complement each other.
How do I get started with ESG investing?
Clarify your own values. What's important to you? The environment, fair working conditions, equality?
Analyze companies. Many companies publish ESG reports that provide information about their goals and progress.
ESG funds are reviewed. These funds pool audited companies with good ESG ratings.
Review performance regularly. ESG is not a fad, but a long-term approach with measurable results.
GeldVision offers tools that allow you to filter, analyze, and incorporate ESG data into your investment strategy.
In which industries does ESG play a major role?
Renewable energies — solar, wind, hydrogen
Sustainable consumption — environmentally friendly packaging, recycling
Technology and digitalization — inclusive and ethically managed companies
Education and health — socially relevant sectors with great impact
FinTech — Platforms that make investing more transparent and fairer
The ESG approach can be applied across industries—it is not a trend, but a new way of thinking.
Who relies on ESG?
Young investors. Generation Z and Millennials value values.
Large investment funds. ESG is an integral part of their strategy.
Private investors. People who want to make a positive impact with their money.
So ESG is no longer just for idealists — it has become mainstream .
What does Money Vision offer?
The platform helps users invest with a clear conscience. It offers:
Access to ESG rankings and sustainability data
Filters for targeted investment decisions
Market analyses on green and social trends
Support in building a balanced portfolio
Whether you’re a beginner or a professional, Geld Vision makes sustainable investing easier and more transparent.
ESG investing is more than just a trend. It's a new, future-oriented perspective on money, markets, and responsibility.
You can invest today without betraying your values —and still achieve attractive returns. With the right knowledge, the right tools, and platforms like Geld Vision, sustainable investing becomes a true success model.
Because investing responsibly means making profits while contributing to a better world.
Russia-Ukraine Peace Agreement what could it mean to forex!A peace agreement between Russia and Ukraine could send ripples through the Forex and Commodities markets. Here's how major assets might react:
📊 Key Market Shifts to Watch:
✅ Risk-On Sentiment Returns
Traders may rotate out of safe havens like USD, JPY, CHF, and Gold.
Risk currencies like AUD, NZD, and emerging market currencies could strengthen.
✅ Euro Strength Likely (EUR ↑)
Europe gains the most relief → energy prices fall, inflation cools, confidence grows.
✅ Oil & Energy Prices May Drop
Peace reduces supply fears → crude oil and gas prices could fall → impacting CAD, NOK, RUB.
🔀 Likely Forex Movements:
🔼 Pairs Likely to Rise 💡 Reason
EUR/USD Euro up on peace; USD weakens as fear fades.
AUD/JPY Aussie rises on risk appetite; Yen weakens.
EUR/JPY Similar to AUD/JPY—EUR gains, JPY loses.
NZD/JPY Risk-on favors NZD; JPY drops.
EUR/CHF Swiss Franc weakens; Euro benefits.
USD/ZAR (falls) Rand strengthens on global optimism.
🔽 Pairs Likely to Fall 💡 Reason
USD/JPY USD and JPY both weaken, but USD may drop more.
USD/CHF Same story—less demand for safe havens.
USD/RUB Ruble recovery if sanctions ease.
CAD/JPY Oil-sensitive CAD may dip slightly
🟡 What About Commodities Like Gold? (XAU/USD)
⬇️ Gold Likely to Fall
As a traditional safe-haven, Gold (XAU/USD) tends to rise during geopolitical turmoil.
Peace = lower fear = investors rotate out of Gold into riskier, yield-bearing assets.
Lower inflation expectations could also reduce demand for Gold as an inflation hedge.
🧠 Key Level Watch:
If peace is confirmed, XAU/USD could drop below key support zones, especially if USD strengthens slightly on rate differentials.
🔍 Final Thoughts:
The magnitude of these moves depends on the terms and credibility of the peace deal.
If it includes sanctions relief and long-term commitments, expect larger market reactions.
Stay alert for central bank policy shifts, especially if inflation drops.
💬 What pairs or commodities are you watching if peace becomes a reality? Drop your insights below!
📌 Follow me for more macro-FX breakdowns, commodities analysis, and trading insights.
Option Insights – Trading the Greeks Part 3 of 4: Gamma ScalpingOption Insights – Trading the Greeks Part 3 of 4: Gamma Scalping
Gamma Scalping is a trading strategy that combines long option positions with a hedging position in the underlying asset to isolate and profit from the convexity of options. It is essentially a non-directional swing trading strategy that aims to capture price swings—regardless of direction—by neutralizing the linear component of option value changes and focusing on the convexity gains.
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How It Works
Gamma Scalping begins by purchasing a single option or a strangle, and simultaneously entering a hedging position in the underlying to achieve Delta neutrality (the "Delta hedge"). The strategy then waits for a swing in the underlying price in either direction.
Because of the long Gamma position, the position’s value is a convex function of the underlying price. This means that the position will either:
• Gain more than the Delta hedge in a favorable move, or
• Lose less in an adverse move.
The combined position becomes profitable as the underlying moves, regardless of direction. The linear component of the option’s value change—driven by Delta—is hedged, so any residual profit comes from the convexity, i.e., the Gamma.
To realize this convexity profit, the Delta hedge is re-adjusted after the swing has played out. In other words, after the market appears to have reached a turning point, the position is brought back to Delta neutral.
The optimal adjustment points are at the sequential peaks and troughs of the market. Rebalancing at intermediate points captures some convexity value, but typically less than adjusting only at clear turning points.
This is illustrated in the two subcharts of the introductory chart.
________________________________________
How Does Gamma Scalping Make Money?
The change in the value of an option due to a change in the underlying price is approximately the sum of the Delta-weighted change in the underlying (the linear portion) plus a Gamma-weighted convexity component (convexity portion).
• The linear portion is hedged by the underlying.
• The convexity portion remains and represents the profit opportunity.
While the convexity component is typically smaller than the potential linear gain, it is always positive—unlike the linear term, which is only profitable when the direction is predicted correctly.
________________________________________
What’s Being Traded?
Gamma scalping involves adjusting the hedging position—not the options—at perceived turning points in price swings. The options position is kept intact as long as it maintains sufficient Gamma to deliver meaningful convexity.
Even in volatile markets that demand frequent trading, all activity is confined to the underlying, which tends to be liquid and low-cost to trade.
Once the option’s Gamma decays significantly, the entire position (options + hedge) may be reset to “refresh” the Gamma exposure.
________________________________________
What’s the Catch?
The convexity value isn’t free—it comes at the cost of time value decay, as measured by Theta.
If Delta neutrality isn’t re-established promptly during a swing, even a brief counter-move in the underlying can erode the accumulated convexity gains due to time decay. Gamma scalping thus becomes a race between capturing convexity and losing value to Theta.
The key challenge lies in timing:
• Too early: Frequent adjustments reduce overall convexity capture.
• Too late: Time decay eats into the gains.
• Too slow: As expiration approaches, the range in which sufficient Gamma exists narrows, shrinking the window of opportunity.
Despite these challenges, Gamma scalping offers an appealing alternative to traditional directional swing trading, with a more nuanced risk profile. However, it does require experience in managing Theta—especially with short-dated options.
________________________________________
Is Gamma Scalping the Opposite of Time Value Trading?
In a way, yes, but not quite.
Time value trading involves selling options and Delta hedging them—such as in volatility premium strategies (e.g., selling index strangles). These traders aim to minimize realized volatility and capture the decay of implied volatility.
By contrast, Gamma scalping buys options and seeks to maximize realized volatility—through the trader’s own hedging actions. The subtle differences in hedge execution distinguish these two approaches.
This contrast—and what it means to minimize or maximize realized volatility in a hedging strategy as well as time value trading itself—will be explored in more depth in Part 4 of the “Options Insights – Trading the Greeks” series.
________________________________________
Coming Up Next:
📘 Part 4: Time Value Trading and Volatility Premium
by parsifaltrading
9 Simple Ratios Every Great Investor Uses - Buffett Included!Forget the hype, headlines, or hope. These 9 financial ratios are what real investors actually use to pick winners, but...
P/E? ROE? EPS? 🧐
- What are they, or better yet, WHO are they? 🤯
- How high is “too high”?
- Is a low number always good, or just a trap?
- Do all industries follow the same rules… or is that another myth?
Buffett. Greenblatt. Graham. Lynch.
They didn’t rely on vibes — they trusted fundamentals
After years of relying on charts, I built a 9-point fundamentals checklist to filter stocks faster and smarter. Now I’m sharing it with real-life examples and key insights to help you spot what really makes a stock worth owning:
Easy enough for new investors diving into fundamentals
Sharp enough to level up seasoned pros
Real enough to avoid hype
…but the truth is: these numbers did flag companies like Amazon, Apple, and Nvidia before the market gave them credit.
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✅ Quick Reference Table
Scan the table, then dive into the stories…
First Pro Tip: Bookmark this. You’ll check these before every stock pick.
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📊 1. P/E Ratio | Price-to-Earnings
What it tells you: How much you pay for each dollar of a company’s profit.
Short Example: A P/E of 20 means you pay $20 for $1 of profit. High P/E? Expect big growth or risk overpaying.
Strong: Between 15 and 25
Caution: Above 30 (unless fast growth)
Industry Averages:
- Tech: 25–40
- Utilities: 10–15
- Consumer Staples: 15–20
- Energy: 10–20
- Healthcare: 20–30
Story: In early 2023, NVIDIA’s P/E ratio hovered around 25, near the low end for tech stocks. Investors who saw this as a steal amid the AI boom were rewarded—NVIDIA’s stock made 4x by the end of 2024 as AI chip demand soared.
Contrast that with Tesla in Q1 2025, when its P/E spiked above 40 with slowing sales and Tesla’s stock dropped 50% in weeks.
Pro tip: A low P/E is not always good. If growth is weak or falling, it's often a trap.
Example: A utility company with a P/E of 30 is probably overpriced. A tech stock with 35 might still be fair — if growth justifies it.
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🧠 2. PEG Ratio | Price-to-Earnings-to-Growth
What it tells you: If a high P/E is worth it based on future profit growth. Whether the earnings growth justifies the price.
Short Example: A PEG below 1 means you’re getting growth at a fair price. High PEG? You’re overpaying.
Strong: Below 1
Caution: Above 2
Industry Averages:
- Software: below 1.5 is solid
- Consumer Goods: Below 2 is more realistic
- Tech: Below 1
- Consumer Staples: Below 1.5
- Healthcare: Below 1.2
- Financials: Below 1.5
- Energy: Below 1.3
Story: In mid-2022, Salesforce’s PEG was 0.8 (P/E 35, forward EPS growth 45%) as cloud demand surged. Investors who spotted this steal saw the stock climb 130% by the end of 2024. Meanwhile, Peloton in 2023 had a P/E of 20 but near-zero growth (PEG above 3). Its stock cratered -50% as fitness trends faded.
Story: NVIDIA’s PEG hit 0.9 in Q3 2023 (P/E 30, growth 35%) during AI hype, a steal for tech (average PEG below 1.2).
PEG filters hype. A stock can look expensive until you factor in growth.
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🧱 3. P/B Ratio | Price-to-Book
What it tells you: How much you pay compared to what the company owns (like buildings or cash).
Short Example: A P/B below 1.5 means you’re paying close to the company’s asset value. High P/B? Expect strong profits or risk.
Strong: Below 1.5
Caution: Below 1 + poor earnings = value trap
Industry Averages:
- Banks: Below 1.5
- Insurance: Below 1.3
- REITs: Use NAV (aim below 1.2)
- Tech: Often ignored
- Energy: Below 2
Story: In 2024, JPMorgan Chase’s P/B was 1.4, solid for banks (average below 1.5). Investors who bought enjoyed 100% gains.
n 2023, Bed Bath & Beyond’s P/B fell below 1 with collapsing earnings. It looked cheap but filed for bankruptcy that year.
Tip: Only use this in asset-heavy sectors like banking or real estate.
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⚙️ 4. ROE | Return on Equity
What it tells you: How well a company turns investor money into profits.
Short Example: An ROE above 15% means the company makes good money from your investment. Low ROE? Weak returns.
Strong: Above 15%
Caution: Below 10% unless in slow-growth industries
Industry Averages:
- Tech: 20–30%
- Consumer Staples: 15–25%
- Utilities: 8–12%
- Financials: 10–15%
- Healthcare: 15–20%
Story: Coca-Cola (KO) has kept ROE above 35% for years, a sign of brand power and pricing strength.
Eli Lilly’s (LLY) ROE stayed above 25% from 2022–2024, a healthcare leader (average 15–20%). Its weight-loss drug Mounjaro drove consistent profits, lifting the stock 150%+ in two years. Checking ROE trends helped investors spot this winner.
Tip: If ROE is high but D/E is also high, be careful, it might just be leverage.
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💰 5. Net Margin | Profitability
What it tells you: How much profit a company keeps from its sales or what % of revenue ends up as pure profit.
Short Example: A 10% margin means $10 profit per $100 in sales. Low margin? Tough business or high costs.
Strong: Above 10-15%+
Caution: Below 5%
Industry Averages:
- Software: 20–30%
- Retail: 2–5%
- Manufacturing: 8–12%
- Consumer Staples: 10–15%
- Energy: 5–10%
- Healthcare: 8–15%
Story: Walmart’s (WMT) 2% net margin looks tiny — but it’s expected in retail.
A software firm with 5%? That’s a warning — high costs or weak pricing.
In 2023, Zoom’s (ZM) net margin fell to 5% (down from 25% in 2021), well below software’s 20–30% average. Pricing pressure and competition crushed its stock quite a lot. Meanwhile, Apple’s 25% margin in 2024 (tech average 20%) remained a cash cow.
Tip: Margins show whether the company owns its pricing or competes on price.
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💣 6. D/E Ratio | Debt-to-Equity
What it tells you: How much debt a company uses compared to investor money.
Short Example: A D/E below 1 means more investor cash than debt. High D/E? Risky if profits dip.
Strong: Below 1
Caution: Above 2 (except REITs or utilities)
Industry Averages:
- Tech: 0–0.5
- Industrials: 0.5–1.5
- REITs: 1.5–2.5 (manageable due to structure)
- Utilities: 1–2
- Energy: 0.5–1.5
Story: In 2024, Tesla’s D/E dropped below 0.3 (tech average 0–0.5) as it paid down debt, signaling strength despite sales dips - a massive rally afterward.
Tip: Rising debt + falling profits = a storm coming. Always check both.
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💵 7. Free Cash Flow (FCF)
What it tells you: Cash left after paying for operations and growth investments.
Short Example: Apple’s $100 billion cash pile in 2024 funded stock buybacks, boosting shares. Low cash? Trouble looms.
Strong: Positive and growing
Caution: Negative for multiple years
Sector notes:
- Tech: Lots of cash (think billions)
- Industrials: Up and down, check trends
- REITs: Look at FFO (cash from properties), aim high
- Energy: Has cash, but swings with oil prices
- Healthcare: Steady cash, not too high
Story: Netflix had negative FCF while scaling content. Once costs stabilized, FCF turned positive and stock re-rated sharply.
Pro tip: Profits don’t mean much without real cash. FCF is often more honest.
Cash is king: Companies need cash to pay bills, reduce debt, or fund growth. If FCF is falling, they might be burning through cash reserves or borrowing, which isn’t sustainable.
Potential issues : This mismatch could signal problems like poor cash collection, heavy spending, or even accounting tricks to inflate profits.
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🚀 8. EPS Growth | Earnings Power
What it tells you: How fast a company’s profits per share are growing.
Short Example: EPS up 10% yearly means more profit per share, lifting stock prices. Flat EPS? No growth, no gains.
Strong: Above 10%
Caution: Below 5%, flat/negative for 3+ years
Industry Averages:
- Tech: 15–30%
- Staples: 5–10%
- REITs: 3–6% (via FFO growth)
- Healthcare: 10–15%
- Financials: 5–10%
- Energy: 5–15% (cyclical)
Story: In Q1 2024, NVIDIA’s forward EPS growth of 30% (tech average 20%+) fueled a rally as AI chips dominated. Checking forward estimates helped investors avoid traps like Intel, with flat EPS and a drop.
Pro tip: A stock with flat EPS and no dividend? There’s no reason to own it.
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💵 9. Dividend Yield | Passive Income
What it tells you: How much cash you get yearly from dividends per dollar invested.
Short Example: A 3% yield means $3 per $100 invested. High yield? Check if it’s sustainable.
Good: ~3–4%
Red Flag: Above 6% with a payout ratio above 80-90%
Industry Averages:
- Utilities: 3–5%
- REITs: 3–6%
- Consumer Staples: 2–4%
- Tech: 0–2%
- Energy: 2–5%
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💡 Final Thought: How to Use All of This
Top investors don’t use just one metric. They look at the whole picture:
Good growth? Check PEG.
Good profits? Confirm with ROE and margin.
Safe balance sheet? Look at D/E and cash flow.
Fair valuation? P/E + FCF Yield + P/B.
Real power = Combining metrics.
A company with P/E 15, PEG 0.8, ROE 20%, low debt, and positive FCF? That’s your winner.
A stock with P/E 8, but no growth, high debt, and negative cash flow? That’s a trap.
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Real-World Combos
🎯Winners:
Tech Gem: P/E 20, PEG 0.8, ROE 25%, D/E 0.4, growing FCF, EPS 20%+ (e.g., NVIDIA 2023: AI-driven growth, stock soared).
Energy Steal: P/E 15, P/B 1.5, FCF positive, Dividend Yield 3.5% (e.g., Chevron 2023: Cash flow king).
⚠️Traps:
Value Trap: P/E 8, flat EPS, D/E 2.5, negative FCF (e.g., Peloton 2023).
Overhyped Tech: P/E 50, PEG 3, Net Margin 5%, D/E 1.5 (e.g., Rivian 2024).
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🚀 Share your own combos!
What do you personally look for when picking a stock?
If you spotted something off in the numbers, or have a valuable insight to add — please, drop it in the comments.👇
💡 Let’s turn this into a thread that’s not just good but superb and genuinely helpful for everyone.
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Final Thought
“Buy great companies at fair prices, not fair companies at great prices.” – Warren Buffett
This guide gives you the map.
Charts, tell you when.
These numbers tell you what, and why.
And this post?
It’s just the beginning!
These 9 metrics are part one of a bigger series I’m building — where we’ll go even deeper, with more advanced ratios, smarter combos, and real case studies.
If this guide helped you see financial numbers a little clearer, there’s a good chance it’ll help your investor friend too, especially if they’re just starting their journey...🤝Share it with them!
I built this as much for myself as for anyone else who wants to get better.👊
If you made it this far — thank you! 🙏
...and super thankful if you hit "The Boost" on this post 🚀
Cheers,
Vaido
Mastering volume bars – How to read and use volume bars!When it comes to trading, price action often takes the spotlight, but volume is the quiet force behind the scenes that tells the real story. Volume bars show how much trading activity occurs during a given time period and can offer valuable insight into the strength or weakness of a price move. In this guide, we’ll break down how to read volume bars, what the different colors represent, and how to use them to make more informed trading decisions. Whether you're a beginner or looking to sharpen your strategy, understanding volume is a key step toward becoming a more confident and capable trader.
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What will we discuss:
- What is the volume indicator?
- What are the green and red volume bars + the MA line?
- How does the volume indicator work?
- How to use volume during Support/resistance flips?
- How to use volume while trading pattern breakouts?
- How to use volume while trading inside a pattern?
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What is the volume indicator
The volume Bar indicator is a simple but yet essential tool that helps traders understand the level of activity behind every price movement. When you add the Volume Bar indicator to your chart, you will see vertical bars appear beneath each candlestick under in your chart. This represents the total volume during that time period. These bars show how much buying and selling occurred, but not whether it was mostly buying or mostly selling. The taller the bar, the more active the market was during that candle.
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What are the green and red volume bars + the MA line?
A green volume bar means the price closed higher than it opened during that period, indicating bullish sentiment and suggesting that buying pressure was stronger. A red volume bar means the price closed lower than it opened, reflecting bearish sentiment and suggesting that selling pressure dominated. While the volume itself shows how much was traded, the color tells you whether that activity occurred mostly during upward or downward price movement. It's important to note that the color doesn't directly show the number of buyers or sellers, since every trade has both.
The MA line in a volume bar indicator stands for “Moving Average.” It represents the average trading volume over a specific number of past periods, smoothing out short-term fluctuations to show the overall trend in volume activity. This helps traders see whether the current volume is unusually high or low compared to the average. For example, if the current volume bar is significantly higher than the MA line, it could signal strong interest or momentum behind a price move. Conversely, if volume is consistently below the MA line, it may indicate weak market participation or a lack of conviction behind recent price changes.
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How does the volume indicator work?
Using volume effectively in trading involves looking at how it behaves in relation to price. For example, if price is moving up and volume is increasing , that usually confirms strong buying interest, suggesting the move is valid. On the other hand, if price rises on low volume, it could be a sign of weakness or a potential reversal. The same logic applies to down moves, if price drops on high volume, it is more likely a strong selling move. If it drops on low volume, it could just be a temporary pullback.
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How to use volume during Support/resistance flips?
Volume can also play a key role when trading support and resistance levels. When the price breaks through a key resistance level with strong volume, it often signals a shift in market sentiment and increases the likelihood that this level will now act as support. The high volume behind the breakout indicates strong conviction from buyers, meaning bulls were actively stepping in to push price higher.
Because of this, if the price comes back down to retest that zone, it's likely that buyers will defend it, turning the former resistance into solid support. This concept is often referred to as a "break and retest" strategy, and volume is what helps confirm whether the breakout was strong enough to validate the level as a new base.
Without significant volume, the breakout might lack follow-through, and the price could easily fall back below the level, failing to establish it as support. But when the breakout is backed by high participation, the probability of that level holding increases. I’ve included an example to show exactly how this plays out in action.
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How to use volume while trading pattern breakouts?
When trading chart patterns, volume can be a powerful tool to confirm whether a breakout is genuine or likely to be a fake-out. Patterns like triangles, flags, head and shoulders, or rectangles often lead to breakouts, but not all of them are trustworthy. That’s where volume comes in.
If price breaks out of a pattern, it's important to look at the volume at that moment. A strong breakout is usually accompanied by a noticeable increase in volume. This surge in volume indicates that more market participants are getting involved, adding weight to the move. Essentially, higher volume reflects stronger conviction. It means traders aren’t just watching the breakout, they’re actively trading it.
On the other hand, if the price breaks out but the volume remains low or even drops, that’s a red flag. Low volume suggests a lack of interest or commitment, and the breakout may not have enough strength to continue. In such cases, the price might quickly fall back into the pattern, turning what looked like a breakout into a fake-out.
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How to use volume while trading inside a pattern?
You can also use volume to gain insights while the price is still developing within a chart pattern, such as a rising wedge. In these situations, volume can help reveal the strength, or lack of strength, behind the price movement, even before a breakout occurs.
For example, if the price drops sharply with high volume and then starts moving upward again in a rising wedge formation, but this upward move happens on low or declining volume, it can be a sign of potential weakness. The initial high-volume drop shows strong selling pressure, and the lack of buying volume on the recovery suggests that buyers are not fully supporting the move.
This imbalance between strong selling and weak buying can indicate that the upward movement is not sustainable. It often means the rising wedge is forming as a corrective or weakening structure, increasing the chances of a breakdown once the pattern completes. In this way, volume becomes a clue, not just for breakouts, but for spotting when a move might be running out of steam even before it happens.
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S&P 500: The Indicator to Watch Right NowWith US stocks bouncing on Trump’s backtracking over tariffs — just weeks after a 20% correction — it’s fair to say caution is the name of the game. Even though the headline risk has eased slightly, markets are still navigating through a fog of geopolitical noise and economic uncertainty.
In moments like these, where the fundamental picture feels muddy at best, objective technical analysis can offer clarity — not crystal-ball predictions, but structure and focus.
The Traditional Technical Backdrop
Traditional technical analysis isn’t about magic lines on a chart — it’s about mapping out price behaviour with tools that help us stay grounded. Structural levels, trendlines, and a couple of moving averages might seem basic, but they’ve stood the test of time because they do something incredibly useful: they make sense of chaos.
In the case of the S&P 500, several key structural levels should anchor any serious analysis. We’ve got the pre-sell-off highs from February, the April lows, and two interim levels — broken support levels that flipped to resistance during retracement rallies between February and April. These levels now act like milestones in the market’s memory.
Drawing a downward-sloping trendline through the swing highs during the correction gives us a good sense of the broader downtrend. More recently, we’ve also started to see a modest uptrend emerge from the April lows. That creates something of a wedge formation — a narrowing range that’s coiling tighter as buyers and sellers battle it out.
Simple moving averages like the 50-day and 200-day are useful additions here. While they’re lagging by nature, they give us immediate context for where price sits in relation to recent momentum and long-term sentiment.
US500 Daily Candle Chart
Past performance is not a reliable indicator of future results
The Indicator to Watch
There’s a good argument to be made that the most important indicator to watch right now, with the S&P 500 trying to claw back ground, isn’t a moving average or RSI — it’s Anchored VWAP.
Anchored Volume-Weighted Average Price (VWAP) is one of the most effective ways to cut through the noise and see who’s really in control — buyers or sellers. It tells you the average price that traders have paid for the index, weighted by volume, since a specific event or turning point. And unlike regular VWAP that resets daily, Anchored VWAP lets us choose a significant date and track how price interacts with that “anchor.”
If we anchor the VWAP to the February highs, we’re essentially tracking how the market has performed relative to that peak. This anchored VWAP line becomes a kind of gravity — it reflects the average cost basis of those who bought just before the sell-off. If price remains below it, it tells us those buyers are still underwater, and therefore less likely to add risk. Sellers, in that case, still hold the advantage.
On the flip side, if we anchor VWAP to the April lows, we get the average cost basis of the recent bounce. This line reflects where more optimistic, bottom-fishing buyers stepped in. If price holds above this level, it suggests those participants remain in profit — and potentially willing to buy dips.
Right now, the S&P 500 is stuck in a battle between these two anchored VWAP levels. One tracks the pain, the other tracks the hope. It’s a VWAP funnel, and it won’t last forever. Eventually, price will break above one and leave the other behind — and when it does, we’ll have an objective answer as to which side is winning.
Will it be the late bears holding on from February’s highs, or the early bulls from the April lows? The answer is coming. Keep your eyes on the anchored VWAPs — they’re telling the real story.
US500 Daily Candle Chart
Past performance is not a reliable indicator of future results
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