Free Trading Course for Beginners

Course Contents

Introduction

• Course Roadmap
• Where to Begin Learning Trading
• What Is a Fast Start in Trading
• How to Work Through the Trading Course
• Introduction to Charts and the Trading Terminal
• What Is a Demo Account and How to Open One
• Basic Trading Concepts: Spread, Lot, Long and Short
• What Is Leverage in Trading

Technical Analysis

• Technical Market Analysis
• Market Phases: Trend and Consolidation
• Priority Shift Levels
• Reversal Patterns in Technical Analysis
• How to Determine Trend Strength

Volume Analysis and the Wyckoff Method

• Volume Market Analysis
• The Wyckoff Method
• The Effort–Result Principle in the Wyckoff Method
• How to Identify a Trade Entry Point

Psychology and Risk Management

• Trading Psychology
• How to Calculate Position Size with Risk in Mind
• Fear and Greed in Trading
• On Indicators in Trading
• Fundamental Analysis in Trading

Trading System and Practice

• Trader's Trading System
• Position Management. How to Exit a Trade?
• Mathematical Expectation in Trading: A Profitable System Model
• Common Mistakes of Beginning Traders
• How to Choose a Broker for Trading
• What should a beginner trade on the exchange?
• How to Start Trading on a Demo Account
• The Trader's Trading Journal

My name is Igor Arapov . I have been trading financial markets since 2013. Over that time I have selected methods that genuinely work in practice and compiled them into this course. No unnecessary theory — only what I actually use in real trading.

Course Roadmap:

1. Getting to Know the Market — terminal, chart, bar, timeframe, volume
2. Technical Analysis — trend, range, PCL levels, reversal patterns, trend strength
3. Volume Analysis and the Wyckoff Method — effort-result principle, entry point, professional capital behaviour
4. Psychology and Risk Management — position sizing, fear and greed, indicators, fundamental analysis
5. Trading System — three live trade breakdowns, position management, mathematical expectancy
6. Preparing for Practice — common mistakes, choosing a broker, instruments, leverage, basic concepts, trading journal
7. Demo Account Practice — open a demo account, apply the system, complete 100 trades, calculate mathematical expectancy, move to a live account

The course covers everything you need to get started: from basic concepts to a complete trading system with a positive mathematical expectation. The material is structured on the principle of "simple to complex." I recommend against skipping sections — each one builds on the previous.

Where to Begin Learning Trading

If you are just getting acquainted with trading, follow this simple plan:

• Study the course in full — read the sections in order, do not skip any. Each section builds on the one before it.
• Open a demo account — this can be done for free with any broker. Real money is not needed at this stage.
• Apply the theory immediately — as you study each section, open a chart and look for what you have just read about. Consolidation, trend, PSL — all of this is present on any chart right now.
• Execute 100 trades on a demo account — only after this will you be able to objectively evaluate your trading system and its mathematical expectation.
• Move to a live account — only when the demo account shows a stable result over a meaningful number of trades.

Do not rush. The market is not going anywhere, and capital lost through impatience is far harder to recover than spending an extra month on preparation.

What Is a Fast Start in Trading

Let me clarify something important upfront — a beginner who is just starting to trade simply cannot become a fully competent trader right away, because they lack the skill, experience, and often the theoretical foundation. This is exactly what structured education solves. When an experienced trader teaches a beginner, they don't just help them learn the theory — most importantly, they hand over a ready-made trading system. A trading system is the fastest possible way to start operating in financial markets.

A trading system is a set of clear rules for identifying when to enter and exit the market. Minimum deliberation — just a defined action plan. When a beginner adopts it through training, they don't yet become an experienced market participant — but they can already perform on par with those who have been trading for years, because the experienced trader's system is essentially doing the work for them.

This course gives you not only the theoretical foundation but also a complete trading system — all you need to do is practise it on a demo account. In the "Trader's Trading System" section you'll see how trend structure shifts in the market and what stages precede that shift. I always wait for this combination of factors before deciding which direction to trade — if you do the same, you'll be ready to start practising as fast as possible.

How to Work Through the Trading Course

The course consists of 29 sections — arranged sequentially, from foundation to practice. Each section includes the theory and how it is applied in practice when forecasting the market. In this course I do not cover the operation of trading terminals, since there are a great many of them — yet they all share a similar principle: the trader must buy or sell an asset through a broker or exchange in order to profit from the difference in prices.

We will study only the key principles of technical analysis that you can then practice on a demo account. All general trading theory I have placed outside the scope of this course, but it is available in the articles on the site and you can always refer to it if you want to learn more.

I deliberately limit the amount of information given at the start, because over many years of teaching trading I have noticed that beginners struggle with the specific terminology of the profession — and that struggle slows down the learning process and pulls them away from the goal.

Introduction to Charts and the Trading Terminal

Using TradingView as our example, let's cover the foundational information you need to understand before starting the course. Most trading platforms share the same layout: a main chart area where you watch price action on the instruments you're interested in, and a lower auxiliary panel for indicators that help with market analysis and forecasting.

We'll use the most popular cryptocurrency — Bitcoin — to walk through how a trading terminal displays price data and which elements matter for the analysis methods covered in this course. The chart has been marked with arrows and numbers — let's go through each one.

Instrument Name, Timeframe and Data Source

The top of the terminal displays all the essential information about the instrument. In our example: Bitcoin/TetherUS · 1D · Binance.

• Bitcoin/TetherUS — Bitcoin priced in US dollar equivalent via the Tether stablecoin
• 1D — each bar on the chart represents one full day of trading
• Binance — the data source providing price quotes and volume data

At the time of this analysis, one Bitcoin is trading at $75,762 — the current price shown on the right-hand price axis.

How to Read the Live Instrument Data

In the top bar of the terminal, next to the instrument name, four key data points for the current bar are always displayed — updated in real time:

• O (Open) — the price at the start of the current bar
• H (High) — the highest price reached during the bar's period
• L (Low) — the lowest price reached during the bar's period
• C (Close) — the last recorded price (for an unclosed bar, this is the current market price)

In our example: O 76,342 / H 77,904 / L 75,705 / C 75,762. This tells us that during the current day Bitcoin opened at $76,342, reached a high of $77,904, dipped to $75,705, and is currently trading at $75,762. These four values form every single bar on the chart.

Bars vs Japanese Candlesticks — What's the Difference?

Different terminals display the same chart data in different visual formats. The two most common are bars and Japanese candlesticks. They are essentially the same thing — both show the same four values: open, close, high, and low. The difference is purely visual.

A bar uses a vertical line with two horizontal ticks — the left tick is the open price, the right tick is the close. A candlestick uses a filled rectangle for the body — green if price closed higher than it opened, red if it closed lower. The thin lines above and below the body are called "wicks" or "shadows" and represent the high and low.

This course uses bars, but if your terminal defaults to candlesticks — that's fine. The analysis logic is identical.

The Volume Indicator

The lower auxiliary panel contains the volume indicator. It pulls data from Binance and shows the number of transactions between buyers and sellers over the selected period — in our case, per day. This is the exact tool we'll be using in Wyckoff volume analysis throughout the course. The scale on the right side of the lower panel shows the transaction count, giving you a sense of exchange trading activity and allowing you to compare volume levels across different periods.

Why Timeframes Matter

A timeframe is the time scale of the chart. The same asset looks completely different on different timeframes — but the underlying market structure doesn't change, only the level of detail does.

The practical rule is straightforward:

• Higher timeframe (daily, weekly) — shows the broad market structure, major PCL levels, and the direction of the primary trend. This is where you decide which direction to trade.
• Lower timeframe (15 minutes, 1 hour) — shows detail within the move, helping you find the precise entry point and place your stop-loss.

That's why all the live examples in this course are shown on the 15-minute timeframe — it provides enough detail to see structure and identify entries. But the same logic applies to any timeframe, from 5 minutes to the daily chart.

The Bullish Bar (Up Bar)

The main chart area displays a bar chart. A bar is the standard way of representing price behaviour over a time period. Every bar contains 4 key data points:

• O (Open) — the opening price
• C (Close) — the closing price
• H (High) — the highest price during the period
• L (Low) — the lowest price during the period

A bullish bar is green — the closing price is higher than the opening price. This tells us that buyers were more active than sellers during that period.

The Bearish Bar (Down Bar)

A bearish bar is red — it contains the same four data points as a green bar, but with one key difference: the closing price is lower than the opening price. This tells us that sellers dominated buyers during that period.

Understanding bar structure is the foundation of technical analysis — every pattern and signal we cover in this course is built on the interaction of these four data points.

From Bars to Waves — Reading Market Structure

A single bar tells you very little on its own. Real analysis begins when you look at a sequence of bars — this is how price waves form.

A wave is a series of bars moving in the same direction. Several rising bars in a row form an upward wave; several declining bars form a downward wave. The alternation of these waves is what creates the market structure we'll be analysing throughout the course.

Look at any chart — you'll see that price never moves in a straight line. It moves in waves: impulse up, pullback down, impulse up again. Or the reverse. This is the natural rhythm of the market — the constant interaction between buyers and sellers.

That's why in the sections ahead we'll be looking at the market not through individual bars, but through schematic examples of waves and structures — ranges, trends, Priority Change Levels. All of it builds on the same foundation: bars form waves, waves form structure, and structure tells us which direction to trade.

What Is a Demo Account and How to Open One

A demo account is a virtual trading account with real market data but no real money. You see live quotes, open and close trades — but all results are simulated. It's the only way to practise your skills without risking real capital.

Let's look at how a demo account works on the TradingView platform. The key elements are marked on the screenshot:

Account balance — when you open a demo account on TradingView, you're automatically credited with $100,000 in virtual funds. This is your starting capital for practising. You can trade any size within this amount.

Demo / Trade buttons — at the bottom of the screen you'll see two buttons. «Demo account» is virtual trading mode, «Trade» switches you to a live account with a broker. Always start in demo mode.

Positions — this panel shows all your open trades. When there are no trades open you'll see the message «You have no open positions». After your first trade, all the details appear here: instrument, direction, size, take-profit, stop-loss, and current P&L.

How to open a demo account on TradingView:

• Go to TradingView
• Create a free account
• Open any chart
• Click the «Demo account» button at the bottom of the screen
• Virtual funds are credited automatically — you can start trading immediately

Demo account with a broker — in addition to TradingView, virtually every broker offers a free demo account. This is useful if you've already chosen the broker you plan to use for live trading — it's better to practise on the same platform and with the same instruments you'll use when trading real money. Typically, opening a demo account with a broker only requires registering on their website and selecting «demo» as the account type — no documents or real money needed.

Demo accounts are completely free everywhere. Real quotes, real order execution — just virtual money. This is where you'll practise all the methods from this course until you complete 100 trades with positive mathematical expectancy.

Basic Trading Concepts: Spread, Lot, Long and Short

What Is a Spread and Commission

When you open your first trade on a demo account — you notice the position immediately shows a small loss. This is not an error and not a real loss — it's the spread.

The spread is the difference between the buy price and the sell price of an asset. Look at any terminal — there are always two prices: «Buy» and «Sell». They differ slightly. This difference is the spread — and it's what you effectively «pay» the moment you enter a trade.

Simple example: Euro buy price 1.0850, sell price 1.0848. Spread — 2 pips. The moment you open a position your account decreases by the value of those 2 pips. That's why the trade is immediately in the red — you haven't yet earned enough to cover the spread.

In addition to the spread, brokers charge a commission — a fixed fee for opening and closing a trade. Some brokers work only through the spread, others charge commission separately. Always clarify these terms before choosing a broker — over hundreds of trades, the difference in spread and commission significantly impacts your overall result.

What Is a Lot in Trading

A lot is the standard unit for measuring trade size. When you open a position you specify the number of lots, not the number of dollars.

A standard lot in forex is 100,000 units of the base currency. That sounds intimidating — but that's exactly what leverage and fractional lots are for. In practice beginners trade micro lots:

• 1 lot = 100,000 units
• 0.1 lot = 10,000 units (mini lot)
• 0.01 lot = 1,000 units (micro lot)

Futures are simpler — one lot equals one contract. The pip value per contract depends on the instrument. That's exactly why in the position sizing section I used $10 per point as the example — those are the real parameters of the Euro futures contract on the CME exchange.

The rule for beginners is simple: always start with the minimum size. On a demo account it doesn't matter, but the habit of trading small will protect you from large losses when you move to a live account.

Long and Short Positions

One of the first questions beginners ask is — how can you sell something you don't own? That's exactly what a short is.

A long position — buying an asset expecting the price to rise. You buy low, sell high — the difference is your profit. This is intuitive.

A short position — selling an asset expecting the price to fall. The mechanics: your broker lends you the asset, you sell it at the current price, the price drops, you buy it back cheaper and return it to the broker. The difference is your profit.

Simple example: Euro price 1.0850. You open a short — selling Euro you don't own. Price drops to 1.0800. You close the position — buy Euro back at 1.0800 and return it to the broker. Profit — 50 pips.

This is why a trader can profit in both rising and falling markets. When the market is in a bearish trend — we open shorts from resistance levels. When it's bullish — longs from support levels. This is the exact same logic we covered in the market phases section.

What Is Leverage in Trading

Before opening a live account with a broker, you need to clearly understand how leverage works — because there are important nuances to using it.

Leverage is the ability to trade a position size larger than your account balance. For example, with 1:10 leverage and $1,000 in your account, you can open a position worth $10,000. That sounds appealing — your profit is multiplied by 10. But so is your loss.

This is exactly where most beginners blow their accounts. The logic is simple — the higher the leverage, the smaller the market move against you needed to wipe out your account. With 1:100 leverage, a 1% move against your position is enough to lose everything.

Another critical concept is the margin call. This is when the broker forcibly closes your positions because you no longer have enough funds to maintain them. It happens automatically without any action from you — and usually at the worst possible moment.

My recommendation for beginners: start with minimum leverage or trade without it entirely. Your goal on a demo account and in the early stages of live trading is to practise your system and understand how the market works. Leverage is a tool for experienced traders who already have a stable system and a solid understanding of risk.

Remember — professional market participants never risk more than 1-2% of their capital on a single trade, precisely because they understand how quickly everything can be lost through aggressive use of leverage.

Technical Market Analysis

Technical market analysis is the primary tool you will use when forecasting the market. The market does not move chaotically — every move is governed by a certain logic and passes through repeating phases. Understanding these phases is the foundation for identifying an entry point into a position.

Market Phases: Trend and Consolidation

On the market you will constantly observe the alternation of two recurring phases: sideways movement (consolidation / flat) and directional movement (trend). Understanding which phase the market is currently in is very important, because your strategy for opening trading positions depends on it.

Consolidation (flat) — sideways market movement with clearly defined boundaries. Sometimes price may briefly exceed these boundaries (making false spikes through the levels), but schematically it still remains within an obvious range.

The boundaries of the range receive special attention because support and resistance levels are drawn along them. The upper boundary is conventionally called the "resistance level," and the lower one the "support level." Below is a schematic example of a flat with its boundaries marked.

Trend — directional price movement is characterized by rapid price change in the direction of the trend and slow movement during the pullback phase. The best trading opportunities on the market form when a trend is present: you move with the flow and gain maximum efficiency from the trades you make.

There are two main types of trends:

• Bearish trend — characterized by a sequential decline in highs and lows. Each new peak and trough is lower than the previous one.
• Bullish trend — characterized by a sequential increase in local highs and lows: each new peak is higher than the previous one.

As I mentioned above, the trader's task is to determine which phase the market is in, because the strategy for opening trades depends on it. If the market is in a bearish trend, the trader opens sell positions from the "resistance" level; if the trend is bullish, they correspondingly buy from "support" levels. We will identify the active market phase using Priority Shift Levels (PSL), which show us who is in control of the market at any given moment: buyers or sellers.

Priority Shift Levels

Priority Shift Level (PSL) — a dynamic zone on the chart from which an impulse move begins (a wave of buying or selling) that leads to the update of price extremes.

This level indicates the potential activity and strength of the side that is currently dominating the market — whether buyers or sellers. Our primary task is to identify who holds the initiative and to join that initiative.

The schematic example shows how PSLs form in a bearish trend and what needs to be seen before it reverses into a bullish trend. For us, PSL levels serve as beacons that signal whether the current trend has paused or is no longer valid and a new trend has begun.

A priority shift level also forms in areas where price is held (position accumulation). This area is defined by the formation of a level with three or more price touches.

Let us examine a live chart where we have marked the key PSL levels using the EUR/USD currency pair as an example.

Every time price made a new low we marked the resistance level, which in turn told us about the bearish tendency in the market. As long as the price structure had not changed, we could expect further price decline. In our example, before the trend changed a flat formed with fairly clear ranges — and after price broke out of it, an ascending bullish price structure began to form. It is very important to remember: until the market itself has replaced the current market structure with a new one, we do not forecast that this will happen! The trader's task is not to fantasize about the future movement of the market, but only to react to objective reality!

While the bearish structure was in place we could open sell positions from "resistance" levels. Once the market rewrote its structure, we no longer open sell trades — we work exclusively from the buy side at "support" levels within the new bullish structure.

Reversal Patterns in Technical Analysis

Below we will examine the main types of reversal patterns we encounter on charts. The central idea of these schemes is to show how "resistance" systematically transitions into "support" and buyers take control of the market. This is the key principle of technical analysis when working with levels.

In this example we can see how in a bearish market (Wave 1-2-3) lows were being updated with the formation of PSLs. Wave 1-2 shows the inability to update the low of wave 2-3 — often characterized on charts as a "false spike of the low" — after which price breaks the PSL "2" and forms a new bullish structure.

Most often, before a trend change we see the formation of a flat — as in the live example above or the schematic example below — but this does not change the essence. Only a breakout of the active trend's PSL level gives us grounds to speak of a change in the balance of supply and demand in the market.

In the schematic example we see how the market breaks the resistance level, consolidates, and forms support together with a bullish price structure. Below are schematic examples of trend changes with possible formations. It is important to remember that on the market these can appear in completely different shapes — but the structure itself will not change! Before any active trend reversal we will always note a breakout of the active PSL followed by the formation of a new trend.

Key takeaway: The market tells you which phase it is in — all you need to do is carefully read the information about the active levels and react when they change.

How to Determine Trend Strength

Trend waves must show signs of strength and be aggressive (fast, impulsive) and longer than the pullback waves. Pullback waves must show signs of weakness. Sometimes pullback waves can be flat (balance-like, "consolidating").

A weakening of trend waves and a strengthening of counter-trend waves is one sign of a weak trend that is close to reversal or balance — but it is not a signal of a trend change in itself.

This is a schematic example of an active trend weakening. But as stated above: no matter how much the chart seems to be telling you it "wants to reverse," you must not react to that until the structure itself has changed. PSL levels are the key reference points for identifying a change in the active trend.

Volume Market Analysis

Volume market analysis — a method of reading and forecasting the market through data on the number of transactions concluded between buyers and sellers.

In volume analysis we look for the footprints of professional market participants in order to understand in which direction they are accumulating or distributing their positions. Because these participants trade in large volumes, they cannot go unnoticed.

Key aspects of the analysis:

• Elevated volume activity — large volumes, spikes, clusters. As a rule this indicates that professionals are very active at that moment and are executing trades. This is an easily visible vertical volume that stands out even without additional indicators.
• Reduced activity — signals a lack of interest from professionals and often precedes sharp moves after a quiet period. This typically occurs after a position has already been built.

In the example we see the data from the "Volume" indicator, which shows the number of trades executed over a specific time interval depending on the timeframe selected on the main price chart. We can easily spot the "skyscrapers" on this indicator — which means only one thing: active trading between the largest market participants. Later we will get acquainted with the Wyckoff method, which thoroughly breaks down the behavioral patterns of professional capital and how to interpret these spikes of professional activity.

The Wyckoff Method

The Wyckoff Method — a market analysis system developed by Richard Wyckoff in the early twentieth century. The core idea: the market is controlled by large players (banks, funds, market makers), and their actions leave traces on the chart through price and volume.

The Effort–Result Principle in the Wyckoff Method

The key to understanding volumes and the Wyckoff method is the combination "volume + price = result," also known as the effort–result principle.

We always examine trading volume in the context of price movement in order to identify the direction of the imbalance between buyers and sellers and to assess the efficiency of the volume.

Using this combination we can analyze:

• Trend strength
• The efficiency of individual movement waves
• The behavior of individual bars

If volume is high but the price result is weak — this is a signal of a possible loss of strength or absorption. And if volume is accompanied by strong movement — then the effort produced a result, and the side behind that volume is in control of the market. In simple terms, we can quantitatively assess the size of the imbalance and more accurately identify the side that professional market participants are on.

Let us examine a schematic example of how the "effort–result" principle works on the Gold futures ("GC") chart from the CME Group exchange.

Zone 1: An up-bar with ultra-high volume appears on the chart. The spread (width of the bar body) is noticeably wider compared to the preceding bars. This is clear effort on the part of buyers. However, instead of continued upward movement we see price stop and enter a sideways move — the flat phase begins. We observe effort without result: the volume was there, but price did not move higher. This is a signal that selling within the up-bar exceeded demand — the first sign of weakness has appeared in the market.

According to volume analysis under Richard Wyckoff's methodology: "Market weakness always appears on up-bars, and strength on down-bars." This statement implies that professionals never sell without a surge of demand — otherwise their large volumes would simply collapse the price against themselves and their profit would suffer significantly. To avoid this they wait until there is sufficient demand in the market to sell without an obvious shift in prices.

Zone 2: Sideways market movement with a failed attempt to rise above the ultra-high volume bar from Zone 1, followed by the formation of a bearish priority shift level. A failed attempt to break above the key level is called a false breakout, which reflects the absence of interest from large participants in moving the market in its previous direction.

Zone 3: The beginning of an impulsive (trending) move in the new direction with the formation of new priority shift levels at lower prices. All subsequent trades are recommended to be opened exclusively in the direction of the impulsive move. Trading with the trend is the foundation of successful trading over a series of trades.

This schematic example using the Wyckoff method and PSL shifts shows how professional money tends to operate in the market. You will often notice that they enter the market solely to change the active trend — which strongly underscores their "predatory nature."

How to Identify a Trade Entry Point

Our task is to enter the market after an impulsive move, on the price pullback — in the direction of the impulse.

Pullback move — during a breakout of support/resistance, the stop-losses of participants who expected a bounce from the boundary are triggered. Because a stop-loss is a reverse market order — an instruction for the immediate closing of a position — price is simply swept through the chart. Participants who were originally positioned in the correct direction close their profit (buy back at market), and this produces the pullback. It is on the understanding of this market mechanic that we will build our trading strategy.

I have intentionally shown two schematic examples to make the following point clear: the market is not mathematics — it is first and foremost the psychology and emotions of its participants. The price chart does not always have to move the way you have come to expect (as in the "calm market" example). Often price will move with no pullback at all, ignoring the standard patterns of its behavior — especially when unexpected news is released.

Returning to the gold chart, let us break down wave "3."

Wave 3 — an impulsive wave on ultra-high volume with a wide bar body. The wide bar body tells us about "panicked" market selling (market sell orders). Any breakout of a consolidation zone inevitably hits the stop-losses of those traders who are trading off the boundaries.

Then the pullback move begins — exactly the one we will always wait for after an impulse, in order to determine whether the breakout was genuine or false. I always wait for price to pull back to the consolidation boundary and only then make a trade decision, because market participants almost always resume their move from the prices where they originally applied effort!

If the breakout was genuine, the resumption of selling will occur from the breakout price level. If the breakout was false ("shakeout"), we will see price exit to the upside.

In this particular case we saw price approach the consolidation zone on ultra-low volume and resume moving downward. Our entry point came after the formation of a new priority shift level in the downtrending market.

Trading Psychology

Our task is to learn how to calculate the working position size, correctly place a protective order (stop loss), and understand the main psychological traps of the market that prevent many traders from consistently trading in profit.

Capital management — risk management is the key to stable deposit growth. The risk in any individual trade is directly proportional to the trader's experience, but even the most experienced can make mistakes!

There is nothing permanent in the market, so never allow yourself to risk too much!

Your deposit and your risk per trade must always satisfy two criteria:

• They must be comfortable for you at your current stage of development
• They must not threaten your financial security

This is a schematic example of stop-loss placement after entering a position. On the chart we can see how a protective order is conventionally placed in order to limit the maximum risk in a trade. The size of the stop order depends on the targets being set. The stop order is generally placed beyond the local extreme that shows signs of the pullback move having ended.

How to Calculate Position Size with Risk in Mind

Let us calculate position size taking the allowable risk into account.

Input data:

• 💰 Capital: $35,000
• 📉 Allowable risk: 1% of capital
• 📏 Risk per trade: 150 points
• 💵 Value of one point: $10 (per 1 contract)

Calculation formula:

Position size = (Capital × Risk % × 0.01) / (Risk in points × Point value)

Position size = (35,000 × 1 × 0.01) / (150 × 10) = 350 / 1,500 = 0.233 lots

Checking the loss if the stop-loss is triggered:

Loss = 150 × 10 × 0.233 = $349.50

This corresponds to approximately 1% of capital, exactly as specified.

Many participants work both through brokers who provide market access and directly through exchanges. Before calculating the position size it is important to clarify the parameters of the instrument being traded (the value of one point) — after that you can simply plug the values into the formula and calculate the trade size. I strongly recommend first practicing all the rules on a demo account until the skill is firmly established.

Fear and Greed in Trading

The core idea of volume analysis is that market prices are driven by fear and greed. It is precisely on these emotions that professional traders trap the 'crowd' and take their money.

Many beginner traders make the mistake of applying an amateur or social gambler's mindset to trading. They view trading as entertainment. If you are serious about trading, it is vital to change your thinking. Trading can be enjoyable, but the primary goal of professional trading is to generate profit.

On Indicators in Trading

Indicators are one of the first tools a beginner trader encounters. You open the platform, see dozens of colourful lines, arrows and signals — and it feels like you've found the answer. But this is exactly where one of the most dangerous traps for beginners lies.

The main problem with indicators isn't that they don't work. The problem is the psychology of using them. When a trader follows an indicator, they unconsciously shift responsibility for the outcome onto the tool. Trade went wrong? Blame the indicator, find a better one. And so the cycle continues — months and years spent searching for the "perfect" indicator that will finally always be right.

I spent several years searching for an indicator that would help me forecast the market — tried everything I could find, but nothing worked.

Indicators are by nature derivatives of price — they process events that have already happened and display them in a different form. They don't predict the future, they describe the past. That's why any indicator always lags behind the actual market movement.

Does this mean indicators are useless? No. An experienced trader can use them as a supplementary tool to confirm their analysis. But the key word is supplementary. The foundation must always be an understanding of market structure, volume and price behaviour — which is exactly what this course is about.

My advice: don't waste time searching for the perfect indicator at the start of your education. Master the fundamentals — market structure, PCLs, the effort-result principle. Once you understand how and why the market moves, you'll be able to judge for yourself which tools help you and which ones just create noise.

Fundamental Analysis in Trading

Fundamental analysis is the study of economic factors that influence the value of an asset. Interest rates, inflation, GDP data, central bank decisions, geopolitics — all of these drive markets at a global level.

That sounds logical and important. And it is. But there's one problem — for a beginner trader, fundamental analysis is essentially a separate profession. To correctly interpret inflation data or a Fed decision you need to understand macroeconomics, monetary policy, and the relationships between markets. That takes years of study.

That's exactly why at the early stage I recommend focusing on technical analysis and volume analysis. The market already reflects all fundamental factors in price — your job is to learn to read that price, not to try to predict it through economic data.

This doesn't mean fundamental analysis is unnecessary. Over time, once you have a solid trading system and consistent results on a demo account — fundamental context will start adding value to your analysis. You'll begin to understand why the market is moving in a particular direction on the higher timeframes.

My advice is simple: first learn to read the chart — structure, volume, price behaviour. That's the foundation. Fundamental analysis is the next level that will come with time and experience.

Trader's Trading System

Live Example: Euro Futures

Let us analyze a live example on the Euro futures chart (the equivalent of EUR/USD on forex). This example is a classic illustration from the Wyckoff concept — we will apply the "effort–result" rules to identify the intentions of professional money, and we will also note the structural shift through the PSL level. Important areas on the chart are marked with numbers; descriptions follow below. The chart timeframe is 15 minutes, but it can be any timeframe.

1. In the Wyckoff method, wide down-bars on ultra-high volume generally mark the beginning of asset accumulation by professional money. If in the gold example we saw them selling at highs on elevated demand so as not to push price against their own selling, then in this example they are doing the opposite — buying when supply is at its maximum so as not to push price against their own buying. The conclusion: professional money always looks for opportunities in the market to buy or sell in a way that does not move price against them. The fact that at point 1 price refuses to fall further despite such a flood of selling confirms our thesis.

2. Point 2 is an entire range within the ultra-high volume zone. You can see how, over time, selling pressure steadily eases — which is additional confirmation that hidden buying was occurring in zone 1, preventing price from collapsing even lower. Zone 2 is also essentially the wave that should have updated the low — which, naturally, we never saw.

3. The key trigger for our attention. If initially we were reading hints from the market and drawing logical conclusions about what might be happening in the background, the market now speaks unambiguously: "I am changing trend" — a structural break, a breakout of the PSL resistance level.

4. Recalling the theory we covered above in the schematic examples, we see a pullback to the resistance level — now from above — and we note the completed retest. The level has held and the first higher low appears, with a characteristic bullish pin bar. In this case the example belongs to "calm market behavior" — there is no obvious frenzy, everything is within classic parameters. Point 4 is also the best place to set the protective order, as the first higher low within the rising structure.

5. A new effort toward upward movement — volume is ultra-high, which is a good sign for the development of the new trend, as price is holding schematically within the ascending structure.

After the formation of the new structure that we marked on the chart, all trades must be exclusively trend-following in nature — from "support" levels, as we covered in the schematic examples.

Live Example: Japanese Yen Futures

Let's walk through a live example on the Japanese Yen futures chart (equivalent to USD/JPY on forex). This example is also a textbook Wyckoff setup — we want to identify the intentions of professional money and mark the structure change through the PCL level (indicated by the blue arrow). As usual, key zones are numbered on the chart; descriptions follow. Timeframe is 15 minutes, but the logic applies to any timeframe.

1. As always, we wait for the selling climax signal — when supply floods into a key level of interest, which professional money exploits by buying without moving price against their own purchases. This is always a down-bar (a surge of market sell orders), after which price reverses and doesn't go lower. The selling climax also marks the beginning of the accumulation phase by smart money.

2. Zone 2 is always an entire range sitting in the ultra-high volume area. Until selling pressure weakens, the market won't respond with upward movement. But the moment volume on bearish bars begins to dry up, we'll always see the market respond with rising prices. And of course, this is additional confirmation that Zone 1 was indeed an accumulation phase.

3. As always, this is the critical moment — we see the first attempt to break through the PCL after selling pressure weakened within the range. After every first breakout of a level, we always wait for price reaction. It's essential to wait for wave 3-4 as a "market test".

4. The first higher low after testing the PCL resistance boundary — the most important factor in the trading system. If the market forms the first higher low at point 4, we have every reason to declare a trend change. Point 4 is the ideal stop-loss placement — just below the first higher low within the rising structure.

5. New effort to the upside — volume is ultra-high or high, a strong sign that the new trend is developing, as price holds within the ascending structure. Point 5 is the market's response after the successful test (wave "3-4").

This example mirrors the previous one. A trading system is a sequence of specific market events. If you don't see the sequential appearance of 1-2-3-4-5 — there's no entry point within the trend structure. If you do see them — you have every reason to trade in the direction of the trend.

One more important note: in this beginner's course I only cover trend-based setups, because trading with the trend always gives you a risk/reward ratio of 1:3 or better — which is the essential condition for positive mathematical expectancy, covered in detail in an earlier section. The site also has a "Practice" section where I've collected examples of range trading — working bounces from boundaries (flat market). I recommend that method only for those who already have enough experience to identify Price Action patterns on a chart.

Live Example: Distribution Phase on Euro Futures

Let's walk through a live example on the Euro futures chart (equivalent to EUR/USD on forex). Last time we analysed the transition from a bearish trend to a bullish one through the accumulation phase using the Wyckoff method. Now let's examine the distribution phase — how the market transitions from an uptrend to a downtrend. We'll apply the same PCL logic as our reference point and mark points 1 through 5 to track the shift in the market auction. Timeframe is 15 minutes, but the logic applies to any timeframe.

1. We wait for the buying climax signal — when demand floods into a key level of interest, which professional money exploits by selling the asset without moving price against their own positions. This is always an up-bar (surge of market buy orders + sell limits), after which price stalls and fails to go higher. The buying climax also marks the beginning of the smart money distribution phase.

2. Zone 2 is always an entire range in the ultra-high volume area. Until buying pressure weakens, the market won't respond with a decline. But the moment volume on rising bars begins to dry up, we'll always see the market respond with falling prices. This is additional confirmation that Zone 1 was indeed a distribution phase.

3. As always, the critical moment — we see the first attempt to break through the PCL (support level) after buying pressure weakened within the range. After every first level breakout, we always wait for price reaction. It's essential to wait for wave 3-4 as a "market test" — the buyers' response to sharply lower prices.

4. The first lower high after testing the PCL support boundary — the most important factor in the trading system. If the market forms the first lower high at point 4, we have every reason to declare a trend change. Point 4 is the ideal stop-loss placement — just above the first lower high within the bearish structure.

5. New effort to the downside — volume is ultra-high or high, a strong sign of new trend development as price holds within the descending structure. Wave 4-5 is the market's response after the successful test (wave "3-4"). Volume also confirms the shift in the market auction direction (sell stop order pressure).

The accumulation and distribution phases in Wyckoff methodology are mirror images of each other — they may differ in duration, but are structurally always similar. To trade within a trend, you never need to predict the transition before wave 4-5 forms — that is the optimal place to join the new trend structure with a clearly defined protective order.

Position Management. How to Exit a Trade?

One of the most important topics in trading — entries can be found in a million different ways, but the exit is rarely predetermined.

The market is a dynamic system that changes every second under the influence of countless factors (news, events, etc.). You never know for certain where price will go next. This uncertainty is the first and most fundamental constant of the trading profession. And at this stage, most beginners fail.

Psychology plays a decisive role here. People handle uncertainty poorly. We want to know "what happens next" — and that desire pushes us toward searching for the "holy grail" — a system that is almost always right. I went through this myself. In my early years I tried almost everything: classic indicators found on most platforms, martingale, various averaging strategies, algorithmic trading, scalping. Several accounts were completely wiped out. The market made it brutally clear: such systems simply don't exist.

Why the Wyckoff method? I didn't arrive at it quickly — it came after years of searching for a trading approach that suited me specifically. Every person is unique, and everyone needs their own methodology — again, because of psychology. In Wyckoff I found what I had been missing in other approaches: clear logic. We track the most sophisticated market participants who, according to CME exchange data, are both the largest participants and the ones most likely to make rational decisions. The exchange itself confirms that they consistently end up on the right side of the market. Beyond the logic, we have a complete picture of their behavioral patterns, which greatly simplifies analysis. Since their trades are typically tied to levels — local or global — the market stops being "chaos" and becomes a logic of value assessment through the lens of "cheap" and "expensive."

So when you see the formations we studied earlier appearing at a level, history shows that price more often travels to the opposite level from where it originated — which is exactly why the opposite level is the logical target for a trade. This is grounded in the fact that price moves from "expensive" to "cheap" and back, while smart money according to Wyckoff methodology takes rational action at these levels and reverses price direction through the volume of their transactions. It's important to understand — this is not a guarantee, but a statistical pattern that, combined with a 1:3 risk/reward ratio, gives the trader a mathematical edge over a series of trades.

In joint research with Professor Sytnyk Inna Petrivna we systematically documented the main cognitive biases of retail traders — a topic well studied by Nobel laureates (" Psychology of Investment Decisions: Cognitive Biases of Retail Traders in Financial Markets ", journal "Інвестиції: практика та досвід", №4, 2026, DOI: 10.32702/2306-6814.2026.4.96, UDC 336.76:159.9). Most of these biases emerge precisely during moments of uncertainty — when a trader cannot calmly accept that their stop was hit or that profit didn't reach the target. The key conclusion: psychology fundamentally works against the retail trader — and the first thing a trader must do is learn not to allow emotions to influence trading decisions.

So what's the bottom line? Exiting a trade is not about finding the perfect point on a chart. It's about consistently accepting uncertainty and the discipline of following your trading system. Don't try to predict the future. Watch market structure and volume, maintain a sound risk/reward ratio — and let the mathematics work for you.

The market will keep testing your resolve. The trader's core task is to stay psychologically intact and keep following the rules — even when every instinct says to intervene.

Mathematical Expectation in Trading: A Profitable System Model

The mathematical model of a profitable system consists of three key parameters:

• Always place a stop-loss (always means always!)
  By cutting losses, you prevent the market from "locking" you into losing trades. This keeps your capital working.
• Risk-to-reward ratio
  The minimum ratio is 1 to 2, and preferably 1 to 3. This means that when risking 5 points, your potential profit must be at least 15 points. If that ratio is not present — the trade should not be taken.
• Probability
  At a ratio of 1 to 3 you can afford to have fewer winning trades and still be profitable, because each win brings substantially more than each loss takes away.

Example with a 1-to-3 risk/reward ratio:

• Stop-loss — 5 points
• Take-profit — 15 points
• 10 trades: 4 losing, 6 winning (60% WinRate)
• Losses: 4 × (−5) = −20 points
• Profit: 6 × (+15) = +90 points
• Overall result: +70 points profit over 10 trades

The same 1-to-3 ratio, but with a winrate of only 40%:

• 10 trades: 6 losing, 4 winning
• Losses: 6 × (−5) = −30 points
• Profit: 4 × (+15) = +60 points
• Result: +30 points — the system is still profitable

These calculations show just how effective the 1-to-3 model is! If you select trades with this ratio, even being right only once in every three trades still yields a positive result!

Common Mistakes of Beginning Traders

Over years of teaching traders I have noticed that the majority of beginners make the same mistakes. Below are the most common ones.

• Trading without a stop-loss. The most costly mistake. The trader hopes price will come back — but the market is under no obligation to do so. One losing day without a stop can wipe out weeks of profitable work.
• Averaging down a losing position. Price moves against you, the trader adds more to reduce the average entry price. The result is that the loss only grows. Averaging losses is not position management — it is gambling.
• Overtrading. The urge to trade constantly — without a setup, without a reason. The market is under no obligation to provide opportunities every day. Sometimes the best trade is the one you did not take.
• Trading against the trend. A beginner sees that price has been rising for a long time and thinks "it must fall now." That is not analysis — it is a guess. Trade only in the direction of the active market structure.
• Revenge trading after a loss. After a series of losing trades the trader tries to recover — increases size, opens trades without analysis. This almost always ends in an even larger loss.
• Moving to a live account without preparation. The demo account feels boring, real money is tempting. But without 100 trades on demo you do not know your system's mathematical expectation — and you are trading blind.

Most of these mistakes are rooted not in a lack of theoretical knowledge but in emotions. That is precisely why trading psychology and risk management stand alongside technical analysis as equal pillars of this course.

How to Choose a Broker for Trading

A broker is the intermediary between you and the exchange. Your choice directly affects order execution quality, the safety of your funds, and the overall trading experience. Here are the key criteria to evaluate.

• Regulation and licence. Your broker must operate under a recognised regulator — SEC, CFTC, FCA, or CySEC. This is the minimum guarantee that the firm follows established rules and your funds are protected.
• Available instruments. Confirm the broker provides access to the instruments you plan to trade — futures, forex, stocks, or crypto.
• Order execution conditions. Execution speed and slippage matter — especially for active trading. Test both on a demo account before going live.
• Commissions and spreads. Compare the cost per trade across several brokers. High commissions compound over time and significantly reduce profitability, especially with frequent trading.
• Trading platform. A reliable, intuitive terminal is non-negotiable. Most brokers offer their own platforms. Test thoroughly on demo before depositing real funds.
• Support quality. Check how quickly and competently support responds before opening a live account. In a critical moment, this can make a real difference.

Golden rule: never open a live account with a broker without testing them on a demo first. Two to four weeks on demo will reveal the true quality of order execution and platform reliability.

What should a beginner trade on the exchange?

Financial markets offer an enormous range of trading instruments. For a beginner, the key is not to spread yourself thin — focus on one instrument and learn its behaviour thoroughly. Here are the main categories.

• Futures. Contracts to deliver an asset at a future date at a pre-agreed price. Traded on centralised exchanges (CME, CBOT) — which means transparent volume, clear rules, and no broker manipulation. That's why all live examples in this course use Euro and Japanese Yen futures. Volume analysis and the Wyckoff method work most effectively on futures.
• Forex. The interbank currency market. Runs 24 hours a day, 5 days a week, with high liquidity and a low entry threshold. Downside — a decentralised market without centralised volume data, which complicates volume analysis.
• Stocks. Shares of ownership in companies. Traded on stock exchanges (NYSE, NASDAQ). Well-suited for longer-term positions. Downside — active trading requires significant capital.
• Cryptocurrency. High volatility, round-the-clock trading. The same technical and volume analysis principles apply here. Downside — elevated risk due to weak regulation and frequent manipulation in low-liquidity coins.

Recommendation for beginners: start with one instrument and trade only that. The methods you've learned in this course are universal — they work across all the markets listed above. The key is to choose an instrument with sufficient liquidity and trade it on a demo account until you complete 100 trades. Once you show a positive result across those 100 trades — move to a live account.

How to Start Trading on a Demo Account

After studying the theoretical material, the next step is practice. You need to open a demo account with any convenient broker or exchange and begin applying your knowledge in real market conditions. Mistakes at this stage are inevitable, and they must not become a reason to stop. Trading is a marathon. The winner is not the one who guessed the direction of a single trade by chance, but the one who earns consistently over a series of trades.

I recommend moving to live trading only after you have completed at least 100 trades on a demo account. This is necessary to determine the mathematical expectation of your strategy — the key metric that allows you to understand what to expect from the system going forward. The methods you have studied in this course are universal: they work on any charts and any timeframes, because they are grounded in market structure and the analysis of the balance between supply and demand.

The Trader's Trading Journal

A trading journal is a tool for control and self-analysis. Since this course emphasises systematic trading, your journal should contain no random trades. Every entry must reflect a deliberate decision made according to your system's rules — you saw a setup, waited for confirmation, and opened a trade with a clear stop and target.

The journal will show you an honest picture of your trading. Not feelings, not memory — numbers. After 100 trades you'll be able to calculate the real mathematical expectancy of your system and determine whether you're ready to move to a live account.

What to record for every trade:

• Date and time — when the trade was opened
• Instrument — what you traded
• Direction — long or short
• Entry price — at what price you entered
• Stop-loss — where your protective order is placed
• Take-profit — where your target is
• Result — profit or loss in pips and money
• Reason for entry — what you saw on the chart: PCL, selling climax, level breakout

The last point is the most important. If you can't explain why you opened a trade — it was a random trade. Random trades have no place in a systematic trader's journal.

Review your journal regularly — once a week or after every 20-25 trades. Look for patterns: what time of day produces the best results, which instruments, which setups. This is the path from beginner to systematic trader.