FOREX HACK 2

By: JOHN MWADIME.

SUPPLY AND DEMAND
ZONES OF TRADING

PURE PRICE ACTION NO

INDICATORS

THIS BOOK WILL BE ACCOMPANIED WITH VIDEOS FOR

FURTHER ELABORATION
BE ADVISED YOU ARE YOUR OWN KEY TO SUCCESS AM A
GUIDE.
TABLE OF CONTENTS
EP 0 MY IDENTITY

EP 1 RISK MANAGEMENT

EP 2 THE RULES OF HIGH AND LOW

EP 3 RALLY BASE RALLY AND RALLY
BASE DROP
EP 4 DROP BASE DROP AND DROP BASE
RALLY
EP5 DEMAND ZONES
EP6 SUPPLY ZONE

EP 7 FLAG LIMIT REGION (FTR AND FTB.)

COMPRESSION AND FAKEOUTS.
EP 8
QUASIMODO AND TIME ANALYSIS

TRADE WISELY FOREX IS A RISKY BUSINESS.

MY IDENTITY
Hello traders,

My name is JOHN MWADIME and the C.E.O of VOI

FOREX CENTRE (VFC), I would like to welcome
everyone on board for the vision is big, those who
never got opportunity you are always welcomed.

I thank those who pushed me to do this, especially

those who believed in me. I AM HERE FOR YOU AND
YOU FOR ME.

I have used advance level of trading S&D+CHART

PATTERNS
Trade wisely based on the knowledge from this book
you can go extra mile to search for knowledge based
on supply and demand.

FOREX TRDAING IS A RISK BUSINESS YOU CAN

LOSE ALL YOUR CAITAL OR GAIN PROFITS.

I thought of how many people are hustling for perfect

entries and an idea came to me that i should write a
second book concerning entries and exits.

Anyway success come after hard work and persistency

in failing and practicing in demo and real accounts

This book will have the knowledge about trading, the

only thing you need to do is master and practice it,
don’t blame anyone when you fail but instead standup
and double the effort.
IN VFC WE LEARN TOGETHER.

#FOREXPOWER.

ENJOY THE BOOK AND DO THE HOMEWORKS.

E-mail:[email protected]

JOHNY MWADIME

+254714298213
Telegram: +254737205842
YOUTUBE (VOI FOREX CENTRE) ALSO ON INSTAGRAM.

Non-authorized personnel not allowed to sell this book

Risk management
Off all the time I have read books concerning trading, risk
management had its own book aside, I don’t know why but
my thought it should be inside the trading books for it’s the
major guide to all new traders to understand the meaning of
trading and trade safely. I have put it here so that I may
guide the lost ones, you can also do more research about
it.

When I first had about risk management I didn’t find time to

study it but after several loses in the market I decided to go
back and dig it up and wow my eyes were opened.

There is a saying “the buyer and the sellers are the same
what makes them different is the choice”
WHAT IS RISK MANAGMENT?
In simple terms is proper utilization of the account, by
risking less to get more.

RULES OF RISK MANAGEMENT (based on my view)

LOT SIZE (ACCOUNT SIZE)

RISK REWARD RATIO
GOAL OR TEARGETS

ACCOUNT SIZE

How much do you have in your account, 20$, 70$, 100$,

500$ or 1000$? Important thing here know what is in your
account and you put it for one purpose to grow it.

If you now have funding in your account the only thing to

know and decide as from this point is which pairs you going
to trade per day and week after the other and how many
entries. This will help you double your account in time.

Grow your cash wisely, this is the first step of all traders.

Risk reward ratio is psychological you have to train your

brain for it, for no one will.
RISK REWARD RATIO (RRR)

Sounds mathematical uuugghhh…I hate math, here too!!!!

Yes my friend is here you won’t escape it, anyway just

simple calculation of raising account, (eti sipendi hesabu
lakini pesa siwezi shindwa hesabu @#!!!!...haaa kenyans)

When I started trading I didn’t apply this strategy my motive

was to make cash nothing more, but I lost so I had to apply
it for the market aint no one friend.

RRR simply means how much you are willing to risk in your
account to get a reward either 1:1 or 1:2.

e.g john has an account of 500$ for trading and willing

to risk 10% to gain 20%. This basically means that am
willing to lose 50$ while trading to get rewarded 100$ in
return.
If you I lost 20% of my account meaning you have lost
100$ apply rule called martingale which has a Principe of
saying use the previous percentage to regain and then go
back to the original %,(not the actual principle but the idea)

e. I lost 20% of my account in two trades I will use 20%

risk in the next trade to gain 40% to cover the loses then
go back to the original risk reward plan 10%:20%

20% if lost
10% risk

10% risk
I normally use R:R of 1:2 or 1:3 when I see odds on my
side if I don’t see them I get away from my computer and
do something which doesn’t include trading, believe me it
helps a lot.

Don’t be greedy!!! You will lose all your cash in a snap of

finger…Thanos …@#$ ahaa.

GOALS OR TARGETS.

If you listen to most entrepreneurs this word is common to

them for it’s the key role of winning, or you think you can
just wake up and be rich just like that….sorry it doesn’t
work here either, solution plan yourself well, who knows
what might happen?!!!!

When I started trading I could trade every pair I see with

good set up little did I know that I was not doing it the right
way, I blew several accounts I know that am not alone here
some of you are stuck here but I came to realize success
follow those who plan their trades.

e.g chose 3 pairs and stick unto them don’t even bother
looking to the rest of the list in fact clear it to remain with
three, analyze them in and out know each move they make
then always wait for the market to give you good entries
then pile your trades, will talk of this on orders.

Conclusion

 Timeframe for entries

 How many pips target ( take profit and stop loss
involved)
 Lot size
 If lost use martingale principle
 haaa … choose wisely

Let this help those who can’t plan themselves and edit
where possible. GOD WON’T STOP YOU WRITING YOUR
OWN HISTORY.
THE RULES OF HIGH AND LOWS
In the first book I talked about highs and lows accompanied with
support and resistance, for they go hand in hand.

The thing about highs and lows is that people don’t tend to keep
their eyes on them, if you ignore them you will regret at some
point am telling you from experience.

 HIGH- simply means the top at which the market changes

its direction form bullish to bearish….got that!!!
 LOW- simply means bottom region of which the market
reverses to bullish from bearish.

They are accompanied with HH, HL, LL, LH…..same

application based on S&R.

Example bellow
The high and lows should be analyzed in high time frame
first to get the clear views of strong support zone and
resistance zone so you can know the entries and exit of
your trades.

Continuation in 30min TF, it gets clearer.

If the fog is not clearing into your eyes then you are the
problem.

The rules of trading highs and lows is based on support

and resistance, buy at support and sell at resistance,
targets always the previous low or high.
Sometimes the market doesn’t respect the regions so you
find market spikes, these are manipulated by the market
makers, and the intension is to fill their own orders… (Stop
loss hunters)
Aka false market alert.
In trading this kind of market I called the stop loss hunter, it
will kick you out in a second then market will continue with
the original direction. I will give you teachings how to enter

in other people stop losses, while they lose you entre.

HOMEWORK… IDENTIFY 10 LOWS AND HIGH AND

LEBLE THEM H, L HH AND LL.

RALLY BASE RALLY (RBR) AND DROP BASE DROP (DBD)

In a marathon the first person always try not to get caught
by the others so in the start he will run like hell, cover great
distance so that he may reduce the speed after living them
behind by a km or 500m, after resting for around 20min of
jogging he speeds up again. What am trying to say here is
this in each currency and market there is certain relation or
competition between buyers and sellers.

When the market moves in bullish or bearish it has points

of which it breaths under(S&R) before it continues with the
moves, these region form patterns especially continuation
(flags and triangles).

These region are very important for they will tell you when
the market is about to break the regions and continue. Let’s
look at the examples.
Those are some of the examples that I have made, will
jump into real time chart.
HOMEWORK IDENTIFY 10 OF THE RBR REGIONS

.
DROP BASE RALLY (DBR) AND RALLY BASE DROP (RBD).
Drop base rally and rally base drop are reversal region
unlike the (RBR AND DBD) which are continuation points.

Reversal region mostly are the end of the move or wave

and beginning of correction, i.e. from bullish to bearish
(RBD), and bearish to bullish (DBR).

Don’t get confused for everything will be explained further,

that’s the basic principle of the DBR and RBD…
REVERSAL POINTS.

I won’t talk much of this but the images will explain further.

DBR. (BEARISH TO BULLISH)

Basic principles are important so get the concept behind
trading these zones, don’t worry time and practice are
important they will change a man completely.

.
HOMEWORK IDENTIFY 10 OF THESE DBR AND LABEL
THEM ACCORDINGLY.
RBD. (BULLISH TO BEARISH)
Same as DBR, RBD are reversal area from bullish
movement to bearish, change of direction in all time frame
either monthly or 1 minute.

These example will help you know more about them.

If you went to a driving school course and did finish, 3
months later you never touched a car, you will be rusty
though you have the skills, same as trading when you don’t
practice every day you become rusty and when you enter
the market it may mess you up.

HOMEWORK IDENTIFY 10 RBD AND 10 DBR.

DEMAND ZONE.
The first time I encountered supply and demand levels of
trading, it was difficult for me to understand but with no time
I got the grip of it. This level is usually accompanied by
supply but I didn’t want to talk about it here, I will do them
separately. Demand zone is basically the support or
resistance level but at this time we look more of what is
found in it.

Most of the traders have two option in the market either

bullish or bearish, demand zone is a bullish zone meaning
this is a reversal area from bearish movement to bullish.
Here is an example.
The level of trading this zone is quite simple for as you
know most of the reversal areas have patterns that signify
the market is about to change direction.

The golden rule of demand level is that:

ALWAYS BUY AT DEMAND

To identify this zone of demand you have to draw based on

SUPPORT&RESISTANCE, weekly and going backward till
the entrance time of your choice.
Here is an example.

Mostly demand zone are the higher low of bullish market or

support levels, check the topic above concerning higs and
lows.

I will identify the demand zone in real life time charts.

Demand at reversal points.

Demand at continuation level of the market.

Now when dealing with demand zone and supply the only
thing you should put into consideration is time frame, for
each time frame has its own pattern of formation based on
fractals.
HOMEWORK IDENTIFY 10 DEMAND AT REVERSAL.
IDENTIFY 10 REVERSAL AT CONTINUATION.

SUPPLY ZONE.
Just like demand zone of trading it the opposite, I did
separate them for a reason for I know people like being
feed everything but as for me here I like people do more
homework’s so as to get better understanding.

I will provide you with a bit of info then the rest will be
yours to accomplish for it’s just the vice versa of demand
zone.
I normally like to high light my chats with blue as demand
zone and red as supply zone, as you can see the supply
zone has been tested here for several time just like
demand. This area is called consolidation zone, whereby
sellers and buyers have common interest of taking the
market to their own way but at the end one has to win.

Most of these consolidation areas we call them chart

patterns especially continuation and at the reversal too.
SUPPLY ZONE at the level of continuation.

Now you have some questions in your mind, how is this

guy identifying these region, well the next topic will solve
the riddle…..

When supply or demand level are broken, the market either

go bullish or bearish but always comes back for a retest
then actively shoot up or down to the original move. Just
like a car when it hits a speed bump.

Trading is psychological
This is an example of what am talking about:
I have combined both (dbr, dbd, rbd) to give you the clear
picture of the zones.

HOMEWORK
FLAG LIMIT REGION (FTR, FTB, SNR, ENGULF)
COMPRESSION AND FAKEOUTS.

FLAG LIMIT REGION/CONTINUATION ZONE

Flag limit it’s a zone which has been combination of (A)
FTR (fail to return) (B) FTB (first time back). FAKE OUT
AND COMPRESSION will discuss it on the next episode.)

I have talked of base, drops and rally, here I will be talking

about them but mostly on how to enter the market on
continuation, just like flags and triangles.

FLAG LIMIT is a crucial zone where you ned to get the

market before it fly’s off or down, this Is where pending
orders work especially limit orders.

I will have a topic of its own about entries in these regions.

(A)FTR- fail to return, yeah!!! I know you trying to find out

what failed to return huh!!

Well (FTR) is just a retest of the market when supply or

demand level (base) have been broken, it’s the first step of
the market to indicate there is dominance either in buyers
or sellers.

Here:
They act like supply on bearish movement and demand on
bullish. We have two types of FTR based on S&R either
bullish or bearish.

A) FTR which didn’t break S&R

B) FTR breaking S&R
These are the complete examples of FTR’s. (The image
above is from random search in the internet)
The simple way of identifying the zone of FTRs is small
time frame, the large time frame are there but for them to
form it will take days.
HOMEWORK IDENTIFY THE FTR ZONES.

C) FTB-First time back, (what came back for the first

time after it failed to return??).

Have you ever forget something in your house and left

walked a few distance, remembered it, thought about it
didn’t see the value in it at the moment walked few
distance and saw that you can’t spend the day without it
went back and took it, then you resumed with the journey.

So basically this is what happens in the market, every move

made is calculated.

As I talked about FTR this is just the continuation, when the

market breaks the zone of supply and form FTR, it
continues for certain extension of which it then begins to
retrace back to the zone near FTR, hence the visit back
after FTR is now called FTB.

Here is the clear indication of what I mean:

This is just a basic of FTR, FTB after either supply or
demand level have been broken or the so called reversal
regions.

If you still can’t get the concept of these zones the videos
will guide you well.

FLAG LIMIT.

Is a zone which combined of dbd, rbr, FTR and FTB, by

now if you did the homework’s you will clearly understand
them but if not then I can’t help define your success.
Let me show you how to combine them.

Before
After
Simple and basic…combined together kabooom!!!... Other
called this flag pattern

Now there is one thing that you need to know about this
area, candlesticks…yeah, yeah….you got to read them and
understand them, especially the continuation and reversal.

The best way to identify FLAG LIMIT is through timeframes,

which of course each timeframe has its own FTR, FTB
(fractals).
For more info about this zones, the videos might help and if
not contact me, i will guide you through.

HOMEWORK…

COMPRESSION ZONE (CP)

Market behaves in a distinct funny way, if you have
observed keenly, sometimes it has mixed feelings of which
you can’t bear standing them creating pressure in you.
Basically this is required so that the market may make the
next big move without your awareness, but don’t worry if
you can solemnly understand the market psychology you
won’t have problem with this.

Compression zone as it states it’s a region of which highs

and lows form but come to close to each other than the
usual, here is an example:
Compression zone (rising and falling wedge), when
combined with chart pattern and support and resistance
that’s when magic happens. You wonder magic…that’s the
definition of it.

Let me show you:

That’s just an example of my drawing, let’s look in real life

scenario.
That’s just a simple CP combined with chart pattern. let’s
look on another which we took trade on it.
At the moment you are confused, its ok I have used patterns
for my entries there will explain this on the topic of
Quasimodo, the compression zone is clear and for more
explanation the videos will elaborate.

CP zone leaves behind level of demand of which they need

to be filled, due to this high level of demand for price, price
reaches its saturation points then dramatically changes its
direction either bullish or bearish, here’s how:
Here is an example of how in the trades we took
I guess these example are enough to give you the clear
picture.

HOMEWORKS.
FAKEOUTS AND LIQUIDITY ZONE
When resistance flips to support means that the direction has
changed and someone is about to dominate the market.

Fake outs are basically support and resistance line which

never got broken but afterwards they do and creates liquid
zone.

Past history of the market is very important for it unveils the

present. As you know about support and resistance levels it
would be much easier to know these zone.

Hence fake outs when combined with compression levels, be

prepared for that’s a thing you shouldn’t miss out.

The images below will help you understand the levels more.
When now combined with Quasimodo this happens.
Learning is a process which takes time, the image I have
combined all the info from the beginning as I continue you
will see that combination of all the stuff will make you
understand more and more.
HOMEWORK
IDENTIFY THE COMPRESSION ZONE LEBLLE THEM AND
LIQUIDITYZONE
QUASIMODO AND TIME ANALYSIS.
When I first heard the name it was hilarious, i remembered
the cartoon Quasimodo from my childhood, the guy had a
hump on his back and his shoulders didn’t align and wore a
green shirt, if you remember then you get the concept.

Quasimodo in forex are just basically patterns of reversal,

yes but here we look keenly at them on highs and lows.

When we combine QUASIMODO and TIME, we get

something more powerful of which we can look into.

QUASIMODO.
When reversal are formed just like head and shoulders and
double tops, market changes direction as you know what
will happen next.

Now for us to get more closely to this zone we apply supply

and demand.
QUASIMODO have different structure and all of them apply
highs and lows (over and under) of the market. The images
below will give you basic QM level also the topic above has
some of the examples of QM.
I have taken trades based on QM and here are the
examples on real charts.

Gold set up entered based on qm

Below is an example of whipsaw and its entrance, before
and after
This level of trading takes practice and patience and more
learning this zones of fake outs and QML.

If by chance you are a slow learner you can check

SHADOWCODES, Facebook it has a lot of info embedded
based on Quasimodo trading style.

FAILED QUASIMODO (DIAMOND OR FLAG)

Every time I look into the market, trust issues begin and this
seriously gives me Goosebumps, this is the reason why
always put in your mind that market isn’t your friend
anything can happen that’s why I got trust issues and put
target of risk reward ratio 1:2.

Not very analysis go through, we use stop loss for this, and
however a failed Qml is basically a flag (a, b, c) which in
turn continues with the original move than going the
intended analysis.
When Qml is reached market changes direction and goes
deep or long but for the failed on it goes short, here is an
example
When applying qml be cautious and look for this zone
before you get knocked out, also it gives you target and
entries at the same time, will elaborate this on videos but
for now you get the concept.

Homework
TIME ANALYSIS
Time is just an abbreviation but the whole stuff has its pure
meaning based on trading, here is the definition.

T-TOP DOWN ANALYSIS

I-IMPACTFULL PATTERNS

M-MOMENTUM

E-ENGULFMENT.
At the moment you are aware of impactful pattern but will
capture the whole thing for I know you are just a newbie to
this theory.

All the things I have told you to do home works on, comes
to this final moment of your trading lessons, if you ignored
them then I can’t say anything for you are your own key.

T- Top down analysis

Most of you have rode the seesaw stuff from child hood, it’s
a funny instrument but if played well you can do
unimaginable stuff with it as I saw it on people are
awesome. In forex same principle are applied based on
support and resistance for they for they form region of high
and low giving you entries of your own styles, just like an M
or a V.
When applying top down analysis we consider time as our
number one factor, especially large time frame for here we
have strong resistance and support (S&D) region.

Here is an example of what am saying

Step on we analyze on D1 time frame the we look for
smaller time frame

IMPACTFULL PATTERNS
As I stated above that this you have known them I won’t
talk more but the images will illustrate more.

After top down the sequence follow impactful pattern for

second entries, yes first entries should be sharp at the point
of reversal and second entries based on impactful patterns,
the videos will illustrate more for those who can’t
understand.
That’s all about impactful patterns will elaborate more on
videos.

Homework
MOMENTUM ANALYSIS

When you watch a movie or documentary based on science

especially physics stuff always on the table of the great
scientist is a pendulum, going to and forth or stationary.

This principle is quite simple just like the pendulum, when

there is a steepness (quick movement) in the market,
correction is always smooth and slow. There is two
movement, strong and weak, when the market begins with
strong momentum the result of correction or impulse will be
weak, and when it begins with weak momentum the result
of impulse or correction will be strong. It’s quit confusing
but the images will help rectify.

If you have been keen enough I have given most of my

examples in bearish form, and this is the reason, in every
part of life there is good and bad strong and weak, I have
provided bearish this means there is bullish, find time
practice bullish through your homework for baby feeding
isn’t one of my virtues.
Gold has the same sequence only that I have used it
several times, but you can preview it from the past topics.

Sometimes the market don’t give you what you need so it

provides the equal strength in movement, this happen
sometimes, but if you know your entries it won’t be hard for
you. Here is an example.
I believe, when you watch videos read this book and do the
homework’s everything will work perfectly without any
wahalla.

Let’s meet in the last topic.

ENGULF
The final moment is here to grasp the last details, though
by now you have mastered every piece I have written here.

When I was in school there were topics I never did even

the teachers showed little concern, though the writer put
them across, I used to think that why do people write things
of which they won’t be taught in school. Everything has a
purpose, I came to realize that same as forex trading there
might be a lot of articles out there but the simplest
profitable and easiest are to be put into consideration.

Engulfment, same as candlestick engulf bullish and bearish

gives you a slight understanding of what am trying to put
across.

Market patterns apply the same technique before reversal

for this is where the trick happens, those who use Fibonacci
extension are better off for it gives off the region of reversal
of the market.

I will explain Fibonacci in the video.

In engulfment i tend to keep away, for this region gives me

hiccups for entry, here is just a basic.

ENGULF- SUPPORT & RESISTANCE

ENGULF-SUPPLY AND DEMAND
ENGULF-FLAG LIMIT ZONE

Read and master well for there will be no videos for this
topic.
ENGULF- S&R + ENGULF - SUPPLY & DEMAND
Basic idea of engulf (S&R+S&D) is there is a tail left
before market reverse on the reversal area.

I wish I could separate the topic of support, Resistance,

Supply and Demand, but they apply the same thing.
The next images will represent some of the engulf type of
market, as I said before engulf isn’t one of my thing, but for
the sake will show you.
Engulf is always accompanied with 3D drive, I will explain it
in videos.

ENGULF-FALG LIMIT ZONE.

I have talked about this zone, flag limit by now the videos
have helped you and can identify this within a fract of
second.
I have fought the good fight and finished the race, I can say
that my work by now is done, all the info I have put in will
help you by doing all the homework’s I wish we could
proceed but this will be the end.

For brokers I trust

HOTFOREX

XM

EXNESS

AVATRADER.
 CONCLUSION

I have had this trading experience for some time, I fell

several times made huge losses in the market learnt from
them, this might happen to you and maybe it has already,
with all the homework’s I know it will make the difference.

“Those who walk alone covers greater distance”

ANONYMOUS.