I made a trading simulator to completely destroy your trading beliefs.
You know how there are many traders and investors in the market?
Then there are banks and algorithms taking trades continuously.
Everyone has their own brilliant reason to buy and sell.
When you have a strong reason to buy, other people might have an even stronger reason to sell.
Basically, what I’m saying is that all kinds of traders taking trades at pretty much the same time create a lot of random up-and-down movement.
This is what we call market noise.
This market noise is less on the higher timeframes.
Well, because it takes a lot of money to move the market up and down.
There has to be a good reason for the price to be in an uptrend, downtrend, or in a crash on the higher timeframes.
But on the smaller timeframes, this market noise is magnified.
It’s like zooming in to see all the small vibrations.
Many people believe that extremely small timeframes are good for trading.
I started trading on the one-minute timeframe around eight or nine years ago.
And yes, I too thought I could make a profit.
But today, I have made a trading simulator that simulates the noise of the market.
And you are going to have to pass a test.
Basically, this simulation shows what the price movement of the smaller timeframes, such as one-minute, looks like when many traders take trades on the higher timeframes.
I will take screenshots of this market noise simulation and mix them up with real trading charts of a higher timeframe that have less market noise.
If you can’t identify market noise from real price movement, then what you call technical analysis or whatever you do on smaller timeframes is complete crap.
If you cannot identify the random market noise movement from the real trending or sideways market, then most of the trades you have taken on the smaller timeframes were garbage.
You were trading an illusion!
If you can identify which screenshot is the market noise and which one is a real price movement, then you are really an exceptional trader.
You are very good at analyzing the price movement.
Are you ready to test your skills?
I will give you ten screenshots.
Number one: This one looks like a range market.
Do you think this is the real price movement or just random market noise?
Number two: What about this one?
It looks like the price is going up after making a downward move.
Number three: This one looks like a downtrend.
Do you think this is a real price movement?
Number four: In this chart, we can see a V-shaped reversal pattern, and there was even an engulfing pattern.
Do you think this is noise or real movement?
Number five: This one has to be real, right?
There is a good uptrend going on.
Many people trade breakouts like this.
Do you think this is real?
Number six: It looks like there was a strong downward move in this one.
Maybe it was caused by the news or something.
Number seven: I literally trade setups like this one.
I have taken many MACD crossover trades at the end of the pullback of the downward moves that look just like this.
Number eight: Look, there is a higher swing high uptrend pattern.
Number nine: Here’s the price reacting to resistance in a range.
Number ten: This looks like a clean price movement with many candlestick patterns.
It looks like the setups I would actually trade myself.
So, how many real price movements did you spot?
How many were just random market noise?
Well, if you spotted two real price movements, then you are wrong.
There were zero real price movements.
That’s right!
All of them, every single one, was random market noise.
It was the random up-and-down movement caused by the buying and selling of the higher timeframe traders.
But on the smaller timeframes, such as one minute, these random movements were so magnified that they even looked like uptrends, downtrends, and even had working candlestick patterns.
But all of them were nonsense.
If you thought even a single one was a real price movement, then you can fall for the market noise illusion.
This is what most of the smaller timeframe price movement really is.
This is why some people say technical analysis is complete nonsense.
I mean, they aren’t completely wrong, are they?
The smaller the timeframe you trade, the more nonsense you trade.
In my around eight nine years of trading, I have only found a few strategies that worked on smaller timeframes.
But that was only in the stock market.
Forex smaller timeframes, such as below five minutes, are really bad.
When I started trading on the forex smaller timeframes eight or nine years ago, no one told me I was trading an illusion.
So, I wanted to make this video to show you what took me thousands of hours of live trading to realize.
Don’t trade smaller timeframes; don’t trade market noise.
That’s all!