Course WATO

Forex Trading
“With ALL the ODDs II”

HIGH PROBABILTY FOREX TRADING
Barry Thornton
12/05/2010
A high probability, short term, Forex Trading system which uses volume information, multiple currency correlation
and the strongest leading indicators to stack the odds heavily in the Forex traders favour on every deal
FOREX Trading “With ALL the ODDs II”
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Table of Contents
1. INTRODUCTION 5
2. EXPECTATIONS 6
3. THE “With ALL the ODD’s II” SYSTEM SUMMARISED 8
PHASE 1 11
4. BASIC SYSTEM TOOLS 11
4.1 CHARTING SERVICES........................................................................................................................................ 11
4.2. BROKERS .......................................................................................................................................................... 13
4.3. CURRENCIES USED AND TRADED .................................................................................................................... 15
4.4. MARKET TIMES ................................................................................................................................................ 16
5. INDICATORS AND DATA USED 17
5.1. INDICATOR 1: A DISPLACED MOVING AVERAGE ............................................................................................. 17
Description ......................................................................................................................................................... 17
Setup .................................................................................................................................................................. 18
Signals and trading information ......................................................................................................................... 19
5.2. INDICATOR 2: A MOMENTUM INDICATOR – RSI............................................................................................. 20
Description ......................................................................................................................................................... 20
Setup .................................................................................................................................................................. 20
Signals and trading information. ........................................................................................................................ 21
5.3. INDICATOR 3: SUPPORT AND RESISTANCE TRENDLINES................................................................................. 24
Description: ........................................................................................................................................................ 24
Setup: ................................................................................................................................................................. 24
Signals and trading information. ........................................................................................................................ 26
5.4. MARKET INFORMATION: VOLUME LEVELS ..................................................................................................... 28
Description ......................................................................................................................................................... 28
Setup .................................................................................................................................................................. 28
Signals and using the information...................................................................................................................... 29
6. SETTING UP TO TRADE THE SYSTEM 37
6.1 SCREEN LAYOUT .............................................................................................................................................. 37
6.2 CHECK LIST FOR TRADING ............................................................................................................................... 39
7. TRADING THE “WITH ALL THE ODDS” SYSTEM 40
7.1. Entries.............................................................................................................................................................. 40
1 At the start of a trend.................................................................................................................................. 40
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Version: WATO II Dec/05/2010 Page 2 of 81

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2 During a trend ............................................................................................................................................. 41

3 After a small retracement during a trend ................................................................................................... 41
7.2. Exits ................................................................................................................................................................. 42
1 Stops ............................................................................................................................................................ 42
2 Targets ......................................................................................................................................................... 43
3 Following stops............................................................................................................................................ 43
4 Reversal signals ........................................................................................................................................... 43
7.3. Staying in a deal .............................................................................................................................................. 43
8. TRADING TECHNIQUES AND CHEATS: 44
8.1. Trades based on 6 charts: ............................................................................................................................... 44
8.2 5 Pip move stop strategy ............................................................................................................................ 44
8.3 Using more sensitive indicators.................................................................................................................... 44
8.4 Trade the Payroll announcement breakout 5 times a week ........................................................................... 44
9. A TRADING DAY WITH BARRY (HOW TO TRADE THE PHASE 1 WATO II SYSTEM) 46
10 THE “With ALL the ODDs II” PHASE 1 TRADING PLAN 48
11. TRADING TIPS 49
12. IMPLEMENTATION PLAN 50
13. MONEY MANAGEMENT AND DOUBLING OF YOUR ACCOUNT 54
14 QUESTIONS AND ANSWERS 56
PHASE 2 57
15. USING WATO II IN OTHER MARKETS 57
16. USING WATO II IN OTHER TIMEFRAMES AND USING OTHER CURRENCY CROSSES 58
17 READINESS KNOWLEDGE CHECKLIST ANSWERS 60
ADDITIONAL APPROACHES 62
18 ADDITIONAL WATO II APPROACHES: The Magic Moving Average approach 62
19 ADDITIONAL WATO II APPROACHES: The Free style method approach 68
20 ADDITIONAL WATO II APPROACHES: The Dominant chart profile approach 73
21 ADDITIONAL WATO II APPROACHES: The WATO II “CATCHING THE FALLING KNIFE” TECHNIQUE 75
22. I NEED YOUR HELP! 80
23. SUPPORT 81
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VIDEOS
To assist you to experience the "With ALL the ODDs II" system Expert4x has prepared a number of videos.
Click here to view videos
1. Selecting a Broker and quick order processing Broker video
2. Chart setup Chart setup
Please check your welcome email for all additional and updated video links.
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1. INTRODUCTION
Welcome to the “With ALL the Odds II” (WATO II) for Forex trading system. I called this system that because it uses
a simple approach and simple signals to stack the odds in the traders favour. At times this approach feels like printing
money.
I am always amazed at the odds offered at the Roulette tables. They look evenly balanced with the Casino always
having that small edge. Forex trading is not much different. The brokers take a small cut and then the price can only
go up or down (Black or Red). But that is where the similarity ends. The Forex trader can really become the money
making Casino by stacking the odds so heavily in the favour of positive deals. Forex traders can choose the time of
day to trade, they can choose the exact moment when the market has the most favourable conditions to trade and
they are given great information in the form of leading indicators and up to date volume and pricing information. You
would think the Forex traders would be the big winners in the Forex trading game. You would think that Forex
traders could create such an Edge over the market that it does not stand a chance. Wouldn’t you?
That is why a trading approach that consistently gives traders an edge is so precious. It stacks the odds in the trader’s
favour so much that winning is an obvious result. The system you will see in this book is such a system.
It is however a Forex system based on trading and mental skills and fitness. These skills are not developed by just
reading the course and intellectualising the content. It is best developed by hands on trading using all the principles
of the system.
It reminds me of the time I was preparing to write my board examination to become a Chartered Accountant. I did a
special course to prepare myself for this challenging exam. In the last 3 months of the course there was no new
material presented – all we did was write practice examinations over and over again, day after day. The presenter
knew that examination fitness and mental preparation was more important at that stage than trying to cram a bit
more knowledge into our heads.
This system is not difficult and the method should be very easy to understand. The system is however not easy as it
requires you to be mentally very strong and fit. It requires focused concentration and the ability to trade selectively.
These abilities are not developed reading an eBook – they are developed by studying the trading screens for hours
and days and weeks to develop the 6th sense that will keep you from trading unsuccessful deals at times and will put
you into successful trades most times – not only because of the indicators – but because you just know.
The more you use WATO II, the more you will realise that it has been designed to achieve 2 objectives. It allows you
to enter successful trades when the market is ready to give them, and, more importantly, it keeps you out of
unsuccessful trades when it is dangerous to trade the market by not giving you trading signals.
The first action you should now take is to print a copy of this document. It is best learn this strategy from a hard copy
book. Having said that, we have added links to concepts used throughout the book. Links are generally under lined
and if you click on them they will take you to a page giving more details of the concept
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2. EXPECTATIONS
Teaching someone a money making Forex system in an eBook has severe limitations. It is a bit like trying to teach
someone to swim or play golf using a book. The ideal is that I should be looking over your shoulder when trading the
system and we should be talking to each other as you put on trades. Then again many more experienced traders
would take the contents of this course and turn the system into a success without any help and assistance.
Please bear in mind that the results achieved in the marketing information where achieved by highly experience
traders (old pros) who might, unconsciously, be using some trading intuition and trading experience that is very
difficult to capture in the limitations of this eBook. The results are however clearly achievable with some blood,
sweat and tears. You are not going to achieve them just by reading the book, setting up your charts and trading your
own money straight away. I wish that were true. You are going to need to get used to a new trading speed and a
different market beat where you will see the impact of trading volumes and orders causing market moves within 30
seconds before your very eyes. Some days you will reach a point where your predictability of market moves will
become uncannily high. Once this happens it will happen more and more.
If you are not used to the faster charts, the 1 minute chart is going to feel like turbo charged trading under a
microscope. Signals and market trends change within minutes or even seconds so that is going to be a considerable
adaption. Correlating volume and price movements may also be very new to you. Especially if you use 3 currencies
and 3 charts with different time spans. The system can also use a different Broker for charting service from the one
used to provide dealing services. To many, all of this will be very uncomfortable and unfamiliar. You need to give
yourself time and practice to get used to this way of trading.
Although the system can be very easy and works very well (once mastered), it does require you to spend lots of time
in front of the screen. This time you will soon realise will be very, very rewarding not only when trading this system
but for trading any other system in the future.
This system is not only about making money. It’s about self mastery, trading competence and an element of
perfection. We suggest that you don’t go anywhere close to a live account until you have achieved at least 20 demo
traded successful deals TWICE in a row. Only then will you have taught yourself selective trading and technical
excellence. Without those 2 qualities you may as well rather buy an expert advisor to do your trading for you.
By now you may have realised that I am an old fashioned trader who actually watches the screens and sometimes
even does an actual mouse click to enter or exit deals. I have made money for years this way and it seems to
becoming easier as time goes on. If you were looking for a highly automated trading system this technique is not the
one for you.
The forex Market is wild, random and highly uncertain and subject to unexpected economic, political and social news
and events. If you really think that you can learn an easy 1, 2, 3 forex system that will make you money tomorrow
and every day there after you really need to consider the reality of your expectations. This system will increase your
chances of success to a very, very high level – YOU however need to make it work for YOU.
The more you use this system, the more you will realise that it has been designed to achieve 2 objectives. It allows
you to enter successful trades when the market is ready to give them, and, more importantly, it keeps you out of
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IMPORT ANT ASPECTS TO BE AWARE OF DURING THIS COURSE
1. WATO II uses 2 different Forex services. We use FXCM for our dealing and MetaTrader4 charts for our
charting requirements. The reasons for this are explained in the course. Normally the charting and dealing
facilities for same broker are used. If you have a service provider that provides all the charting and dealing
requirements of the course you can use 1 service provider.
2. WATO II (phase 1) uses volume as a guide to warn us of possible reversals in the market – volume is not
commonly used as trading information when trading the Forex market. Volume is mainly used in Phase 1 of
the course and when the scalping approach is used. Volume is not used for the higher time frames.
3. WATO II uses a 2 Phase approach:
PHASE 1: Learn to use the method in Asian Market using the EURJPY.
PHASE 2: Use the method in any market using any other correlated currencies in any different time
frames once comfortable with the approach.
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3. THE “With ALL the ODD’s II” SYSTEM SUMMARISED
PHASE 1
Phase 1 uses a scalping (short term) system where transactions can take less than 2 to 5 minutes to reach the target
of 5 pips. Opportunities generally present themselves regularly so 20 trades are possible in a trending market over a
3 to 5 hour daily trading period.
Phase 1 uses the EURJPY which has a reasonable spread and is naturally + 90% correlated to the EURUSD and USDJPY
crosses.
The system uses 3 indicators to establish trends:
 a 3 x 3 Displaced moving average.

 a 4 period RSI.
 trendlines.
It looks at 3 timespan sets of charts:
 The 1 minute charts.

When the trend is coordinated on all the 9 charts (EURJPY, EURUSD, USDJPY crosses x 1 min, 5 min, 15 min charts)
conditions are favourable to enter EURJPY transactions in the direction of the trend using 3 entry techniques.
Volume levels are referred to just before the trade to ensure that the volumes of orders entering the market are
supporting the trade and not opposing it.
Because of the high direction support from the EURUSD and USDJPY currencies and the higher volatility of the
EURJPY a trade in the direction of the trend going for 5 pips is highly probable. Alternative strategies using bigger
targets are also used in trending markets.
As the transaction process is very quick, the system and skills takes some practice to master. The trading process
takes considerable concentration as moves happen very quickly on the 1 minute chart. The 1 minute charts for the
EURUSD, USDJPY and the EURJPY are the main charts used to make the final decision to trade.
Trading takes place in the Asian Market which is less volatile and driven by the steady flow of market orders and
volumes. The UK and US markets, which are news and sentiment driven, are avoided in phase 1.
What follows is an example of a sell signal alignment in all the currencies and time zones traded. When the JPY and
the EUR trend in the same direction the EURJPY has added volatility in the same direction. The price is below the
Moving Average on all 9 charts and the RSI readings are all below the 50 line. Ideal conditions to trade the EURJPY.
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Below is the WATO II chart setup.
Refer to The “With ALL the ODDS” trading plan for more details.
The risk return ratio using the phase 1 approach is not good for sustained profitability by using a target of 5 with a
stop of 16 and a spread of 3. Phase 1 is used to develop your trading skills and you should move on to phase 2 and
longer time frame to improve profitability.
Phase 2
When you are confident using WATO II (phase 1) in the Asian Market on a short term basis using the 1, 5 and 15
minutes charts of the EURJPY you can move onto:
1 Other markets: The European and US market provide good trading opportunities using the scalping
approach.
2 Other timeframes: The WATO II principles can be used on longer timeframe such as using
o 5 Minute, 15 minute and hourly charts or
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o 15 minute, 1 hour or 4 Hour charts.
o 1 Hour, 4 Hour and daily charts.
3 You can use other correlated currency crosses other than the EURJPY – The GBPJPY is particularly good in
the long time frames.
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PHASE 1
4. BASIC SYSTEM TOOLS

4.1 CHARTING SERVICES.
The service works well with any charting service that provides for
 Displaced moving averages.

 The RSI momentum indicator.
 The ability to draw trendlines.
 Provides volume information.
In this eBook we use the MetaTrader software to illustrate examples and screen setups. Most charting services
should provide the same facilities.
Please refer to indicator sections for more details of how the indicators are used and setup.
If your existing charting service does not provide the requirements of this system consider using a MetaTrader
charts. They are downloadable from http://www.metaquotes.net/
It is also important that your charting platform allows you to load up to 6 to 9 charts onto 1 screen so that you can
see 9 charts at the same time. Below is an example how 9 chart facilities are loaded on 1 screen.
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Chart setup video
This video will assist you in setting your charts up as shown above. Chart setup
Chart templates and profiles used in the video.
These are the MetaTrader templates and profiles created in the above video. Only use these if you are competent at
loading templates and profiles into your MetaTrader platform. Expert4x is not able to offer technical assistance or
training in this area. If you are unable to use these please follow the instructions given in the video
Templates (copy to your MetaTrader templates folder)
Candles
WATO
WATO1Min
Download here> Templates
Profiles
WATO (Create a MetaTrader profile folder WATOEURJPY and add the files to it)
Download here> Profiles
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4.2. BROKERS
In the examples that follow we use FXCM to illustrate favourable broker facilities and capabilities. You can use any
broker you wish that gives the same or better services and meets the system requirements.
What you need from your Broker to make this system work is a low total cost of trading (spread and commission) on
the EURJPY. FXCM is an international Forex broker which gives reasonable spreads on the EURJPY 95% of the time.
You can also us FXCM Micro to get competitive spreads with as little as $200.
The MOST IMPORTANT factor is ease of transacting. You need a very fast market order placement facility that will let
you enter the deals with a 5 pip target and 14 pip stop preloaded. FXCM has a one click facility that does this with
one click as shown below. I would just click on the Sell or Buy in the above example and a sell for example will be
activated for 47 lots with a target of 5 pips and a stop of 14 pips.
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The other factor to consider is that your charting software prices should correlate very well with your dealing
software prices. I use FXCM with MetaTrader charting software and I have never had any problems. The ideal is if
you can use the Brokers charts that are 100% in line with the deal prices.
There are hundreds of brokers out there. Now that you know what the requirements are, please do your own
research regarding the suitability of your broker or any broker you would like to use. We cannot evaluate broker
suitability in all countries as part of our support. If in doubt demo trade FXCM account offering, as it meets all be
trading needs for this system.
You can open a demo or live main or micro FXCM account by going to www.fxcm.com
Please Note:
ALL US Based accounts do not generally give one click trading as they do not allow targets and stops to be loaded at
the same time as the processing of instant market orders.
There are some solutions to that.
1. Some brokers will transfer an US account to the UK. You will have to enquire with your broker if this facility is
available.
2. You could manually manage the stop and targets. This is normally safe in the Asian market when trading
Phase 1 if you are not trading at times when announcements occur.
3. You could trade the Phase 2 approach using longer term time frames. This will make the loading of a target
and stops less critical at the time of entering a deal.
Video
This video should assist with managing and using your broker facilities. Broker video
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4.3. CURRENCIES USED AND TRADED
For Phase 1 trading I would recommend the use of the EURJPY which is naturally strongly correlated to the EURUSD
and the USDJPY. One would think that the EURUSD x USDJPY = EURJPY but there is a small difference and the EURJPY
always is more volatile when both the EURUSD and the USDJPY trade in the same direction. There seems to be more
EURUSD represented in the EURJPY at times – this could be because of it’s higher liquidity. Anyway the EURJPY in
general is more volatile than both the EURUSD and USDJPY added together (when they are trending in the same
direction) which suits our system very well.
The illustration below shows how we compared the movement on a EURUSD, bullish, 4 hour candle and the USDJPY,
4 hour, bullish candle with that of the EURJPY 4 hour bullish candle over the same period. The EURJPY is slightly more
volatile than the other 2 combined.
The idea is to always trade when both the EURUSD and the USDJPY are trending in the same direction (Bullish or
bearish) and NEVER to trade EURJPY when the EURUSD and USDJPY are trending in opposing directions to each
other.
The trend is determined by:
 The angle of the Moving averages (Up, down or flat).

 The position of the price relative to the Moving average (above, below or touching).
 A combination of the angle of the RSI, the RSI readings position relative to the 50 line or whether the
RSI has made a meaningful trendline violation.
 Whether a meaningful trendline has been violated on the price chart.
When looking at ALL 3 the currencies used: EURUSD, USDJPY and EURJPY.
Ideally I would like to trade the GBPJPY as it has higher “with the trend” volatility than the EURJPY but the high
spread offered by most Brokers on this cross disqualifies the GBPJPY.
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4.4. MARKET TIMES
In Phase 1 the WATO II system works best when “normal” market forces are driving the price. By normal market
forces I mean the market in managed by market orders in an orderly manner and technical analysis principles
operate well. What is not “normal” is when the market is driven by short term, news, economic announcements,
excessive market sentiment, fear and greed.
I have found that the early European and US market have so many economic announcement and news factors
influencing the market that they are less predictable in the short term. This does not mean that they are untradeable
and that technical analysis cannot work at these times. The volatility and range of short term movements become
much bigger and less predictable. That is why the Asian Market is recommended for Phase 1 of the WATO II system
The Asian market on the other hand, with its lower volumes and less exposure to surprise announcements, seems a
lazier market to trade. This market appears to be driven by technical analysis principles. The price management via
the volume of orders entering the market is more visible and support and resistance principles apply well. The JPY is
well supported and volumes of the EUR are also good. This market is better placed for the trading of EURJPY and the
“With ALL the ODDs II” system.
The Asian market starts after a period where the lowest volumes of daily trading occur. There is a 3 to 4 hour period
when the US markets close and the Asian markets open where the Forex Market experiences its lowest trading
volumes. The liquidity of the Asian market is enough to pull the Forex Market out of this slumber.
The Asian market often produces the highest high or the lowest low of the day so should not be dismissed for nice
trends. The trends tend to be slower and steadier than the fast and furious ones experienced in the European and US
time zones. The chart below shows the typical trading volumes experienced in the various markets.
For this particular system the times from 9:00 am to 3:00 pm Tokyo time are optimum.
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5. INDICATORS AND DATA USED
5.1. INDICATOR 1: A DISPLACED MOVING AVERAGE
Description
Moving averages are one of the 1st basic indicators ever used by traders. They do 2 things – they smooth the path
that the price takes as it randomly moves through the market. This makes it visually easier to see the path of the
price. Moving averages also help to define the phase the price is in compared to the moving average. When the price
is below the moving average it is in a sell mode and if it is above the moving average it is in a buy mode. The
crossover from the one mode to the other can be a trading signal to buy or sell.
When doing short term trading one has to use very fast moving averages that are sensitive to short term changes in
trend (A moving average of 3 price periods is fast whereas a moving average of 200 price periods would be regarded
as very slow). Unfortunately when the moving average is very fast it just sticks in the price range and provides very
little information. See the chart below which is set on a 3 moving average.
The minute you shift (displace) the moving average, you create much more information from this indicator. I displace
(shift) my 3 period moving average by 3 periods and the same chart above looks like this. Buy and sell phases are
now clearly visible.
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Setup
To set the 3 moving average up on your chart On Metatrader select INSERT on the main menu, then selecting
Indicators, then Trend and then Moving averages. See the screen shot below. (Remember to activate the chart you
want the indicator to be added to before selecting the insert on the main menu).
You will then be presented with the indicators window which you can complete as shown below. Please note you can
use the median price or the Close price – it does not matter as long as you use the same settings for all your charts.
Some traders also like using the smoothed MA method instead of the simple method. Again it does not matter as
long as you use the same settings on all your charts.
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Signals and trading information
Moving averages (3 offset by 3) give me 4 ways of getting important information very quickly:
1. The angle the moving average is pointing is a good direction indicator of the current trend.
2. The position of the price relative to the Moving average indicates the trend being experienced –
Prices above the moving average indicate a buy trend and prices below moving averages indicate a
sell trend.
3. When the price touches the moving average it indicates a potential crossover from a buy/sell to a
sell/buy phase or a possible start of a sideways trading phase.
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5.2. INDICATOR 2: A MOMENTUM INDICATOR – RSI
Description
Momentum indicators measure the momentum of a price move. Momentum measures the underlying strength of a
forex move and gives early warnings when the market sentiment moves from a BUY sentiment to a SELL sentiment. I
am not going to explain more than that at this stage. I have found them to be the best indicator of whether the price
is in a bullish or bearish phase. They also provide good trading signals. These signals are so good that you can make
money trade trading them alone. Refer to the Expert4x:- Magic Momentum course
Setup
I use a 4 setting on the RSI indicator. The reasons for this is that signals are displayed very clearly and that because
we are scalping, short term momentum is more important than long term momentum. A view of long term
momentum is achieved by referring to longer term charts.
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Again you can also use the Close Price rather than the Median Price as long as you use them consistently on all your
charts.
Signals and trading information.
There are 2 main signals one can use when applying the RSI indicator.
Trendline violations.
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50% line crossovers:
As momentum moves through the 50% line it creates buy or sell signals. Especially if momentum has gone below the
20% level or above the 80% level before doing the crossover of the 50% level.
I sometimes like setting the screen so that I only see the RSI. This is done very easily by dragging the border between
the indicator and the price chart up to no longer display the price chart. The reason for doing this will become clearer
when I go through the trading screen setup.
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5.3. INDICATOR 3: SUPPORT AND RESISTANCE TRENDLINES

Description:
Trendlines are great for identifying support and resistance areas. The reason why we want to identify support and
resistance is that the price tends to move with more volatility when a strong trendline is violated (Crossed).
Trendlines are nothing more than lines joining the turning points in the market. Trendline can join the upper turning
points and become areas of resistance or they can join the lower turning points and they can become areas of
support.
I also use trendlines on the RSI indicator.
Setup:
To construct trendlines one simply draws extended lines joining the last two major turning points of the price both
below and above the current price movement. What I do is I take the 1 minute chart and set it to a weekly setting
and then I draw the trendlines on that chart.
Then I move to the Daily setting.
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And then to the 4 hour chart.
And then to the 1 Hour, 30 minute, 15 charts and then to the 5 minute chart.
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This gives a view of likely support and resistance levels that will impact the movement of the price. The price will
either break through these levels or bounce off them. The volume readings when the price reaches these levels will
give a clue to whether the price will bounce or break.
Signals and trading information.
A trendline violation (crossover) provides a potential trading opportunity.
Trendline Questions asked:
QUESTION 2: In today's video it was said that it's not good to draw trendlines on the most recent candles if we're
making new highs or lows. I thought that's what we are supposed to do when the mkt. is trending to get back in?
ANSWER: What we are looking for is lots of (white or empty) space between turning points in the market (see the 1st
drawing). If there is no space the there has not been a real turning point (see 2nd drawing). We like drawing
trendlines over real turning points. If you draw trendline on the latest candles you will find that no space has formed
and you may not have used a turning point (see second drawing). The trendline becomes useless or of less value.
You should also not confuse this with entering when the price makes a new high or low in a trending market – this
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concept does not really apply as we are not really using trendlines – we are using a concept of new highs or lows in a
trending market.
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5.4. MARKET INFORMATION: VOLUME LEVELS

Description
The volume indicator measures the level (quantity) of orders entering the market. Volume does not distinguish
between buy and sell orders which is a limitation.
Setup
On Metatrader the volume indicator can be found by selecting INSERT on the main menu, then selecting Indicators,
then Volumes and then Volumes again. See the screen shot below. (Remember to activate the chart you want the
indicator to be added to before selecting the insert on the main menu)
Once you have clicked on the 2nd volumes selection you will be presented with the indicator window. The only
change I make is set the width of the volume lines to the maximum width.
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Click OK and your volume indicator will be added below your chart.
Signals and using the information
I only use the volume indicator on the 1 minute chart and only occasionally on the 5 minute chart. Don’t worry about
the actual readings of the indicator. What we are interested in is how the current volume compares with the most
recent volumes.
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There are a number of ways to look at volume information. In

general I regard volume levels as rockets used in outer space.
When a spaceship want to go in a specific direction it points in
the direction and fires its rockets once and then stops. Because
there is no resistance in outer space the spaceship will
continue going in its direction until the rockets are fired again
– either to stop the craft or reverse it. You will often see a
spike in volume that stops or reverses the price because of this
principle.
There are three ways of using volume:
Confirmation to stay trading with the trend.
When the price is moving in a trend and volumes go lower and

lower (Shown by the red bars) it means the trend will continue until higher volumes are experienced. The chart on
the left is an example of this.
When volume increases (the bars turn to green) it is a warning that the trend is experiencing competing orders and
could stop or even reverse.
Another example of the price is moving in a trend and volumes go lower and lower which means that the trend will
continue until higher volumes are experienced.
Opportunity to enter a trend reversal.
The other way volume is used which is almost the opposite of the
previous method is that when there is a sharp increase in volume
during a trend there is a very good chance that the trend will stop
and reverse. This sharp increase in volume happens BEFORE the
reversal of the trend which makes it a fantastic LEADING
INDICATOR.
The 1 minute chart on the left shows this principle.
This offers an opportunity to get out of a deal 30 to 60 seconds
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before the reversal happens, if you are in a with the trend deal.
I would also not normally enter a deal against increasing volume. There is an exception to this rule which is detailed
below.
Confirming a breakout.
The time when a sharp rise in volume is not a reversal

signal is when the price has not been trending strongly
AND a trendline (support and resistance) violation is
taking place.
Many times the increase in volume supports the

direction of the breakout as shown in the 1 minute
chart on the left. Again volume acts as a leading
indicator in this case.
Reading volume is not always easy and takes experience and practise. The above rules are not cast in stone, as
volume is not the only driver of the direction of the price movement. Support and resistance plays a big role as well
and that is why trendlines are indicators used in conjunction with other trading signals.
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So the general guidelines for volume trading are:
 A trend reversal tends to occur after a build up and an increase in volume to a point where it peaks
above recent volume levels. This knowledge can be used to enter and exit transactions.
 Trends tend to continue on decreasing volumes. This would keep you in a successful transaction.
 Trends will continue on increasing volumes when a trendline breakout has occurred.
Please bear in mind that these are general guidelines. To develop a feel of how volume relates to price movements
one should spend considerable time watching the 1 minute volume and price charts of the EURUSD, USDJPY and
EURJPY.
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More Volume insights:
VOLUME PRINCIPLE 1:
IN NORMAL SOFT TRENDS INCREASED VOLUME REVERSES THE TREND:
When the price is moving downwards as result of say 10 sell orders a trend has been established. It would take say
10 buy orders just to stop the trend and make the price trade sideways. It would take say another 10 orders to
reverse the trend. The market does not exactly work this way but it is good to think of it working that way when
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using the volume information.
An example of how increased volume took awhile to show the trend down and stop it and then reverse it. It stayed
reversed as it was reversing on low volumes.
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VOLUME PRINCIPLE 2:
INCREASED VOLUME TRENDS RESULT OF SUPPORT OR RESISTANCE BREAKOUTS (importance of trendline)

SUPPORT THE TREND DIRECTION:
When the price breaks through important support or resistance, something unique happens.
The price is pushed into an area where bounce traders put their stops (A bounce or retracement trader trades under
the assumption that the support or resistance will be strong and reverse the trend). These orders will be stop orders
that are in the direction of the new trend.
For example the bounce trader that is in a buy transaction because he is expecting a buy bounce will have a sell order
in place as his stop to stop the buy transaction out.
At the same time we have another group of traders that we call breakout traders. They believe that when the price
breaks through strong support or resistance a new trend will start in the direction of the breakout move.
In the above example these traders will be putting in sell orders after the breakout as they believe that the trend will
now become a sell trend.
So what you have is an area where there are many sell orders at the same time. This increases the volume of orders
but this time it pushes the price with the trend (The increased volume of orders do not reverse the trend). This only
happens when strong support or resistance is broken and that is why trendlines and identifying support and
resistance is so important.
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A trading example where there was a small down trend on low volume. As the trendline was violated volume
increased dramatically until Buy orders started slowing and reversing the sell trend. You should enter on the
trendline violation or when the price makes a new low.
To summarise:
In the absence of a trendline violation we assume that increased volume will reverse the trend. When an important
trendline is violated it would be fair to assume initial increased volume supports the direction of the trend.
Market Depth
Also note that certain Forex Brokers supply trading facilities where you can see the actual volumes of buy and sell
orders in the market at the various levels (FXCM does this for clients with more than $25 000 in their trading
account on a special account). This way of trading using Market depth is beyond the scope of this ebook and is not
essential to the success of this trading system. We are interested in making the “ordinary” online forex trader
successful and the principles of this course are enough for that.
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6. SETTING UP TO TRADE THE SYSTEM
6.1 SCREEN LAYOUT
Below are typical screen setups used to trade the system. Although it looks busy, this screen setup works as well on
my laptop screen as well as a 24 inch screen. The setup allows me to see the trends of each currency and timescale
very quickly.
The above current trends are showing that the USDJPY and the EURUSD have trends in different directions and it
may not be the best time to trade – we want the trends to be in the same direction. The Eur is showing RSI readings
above the 50 line and the price is mainly above the moving average. The EUR RSI readings are all below the 50 line
and the price is below the moving average.
Two chart functions to use would be the AUTO SCROLL and the CHART SHIFT functions. These make sure that the
charts are showing the current status clearly by moving them to the left and creating a gap between the right hand
chart margin and the charting information.
Below is an example of a sell signal alignment in all the currencies and time zones traded. When the JPY and the EUR
trend in the same direction the EURJPY has added volatility in the same direction. The price is below the Moving
Average on all 9 charts and the RSI readings are all below the 50 line. Ideal conditions to trade the EURJPY.
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Below is the WATO II chart setup showing a sell alignment:-
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6.2 CHECK LIST FOR TRADING
When conditions are not favourable to trade the WATO II system:
 Do not trade when the trends on the EURUSD and USDJPY conflict
o They conflict if:
 The price is not on the same side of the Moving Average for both currencies
 The RSI is not in the same mode for both currencies
 Do not trade when there is a strong increase in volumes just before the trade.
 Do not trade when volatility is expected due to news or announcements.
In the previous section is an example where the JPY and EUR are trading in opposite directions – confirmed by the
Moving averages and the RSI signals (Please note that had you not been trading this system you may have entered
into a buy in the JPY or even a sell in the EUR – the power of this system is when both currencies trade in the same
direction pushing the EURJPY into accelerated volatility).
When conditions are favourable to trade the WATO II system:
 The price is on the same side of the Moving Average for both the EUR and JPY currencies.
 The RSI is in the same mode for both currencies.
 There has just been a trendline violation on the EURJPY or it is making a new high or a new low.
 Volumes are decreasing or are at the same as the previous levels.
 There is no expected economic news or announcements.
In the previous section are charts showing a sell alignment.
When using the WATO II system the trend is determined by :
 The angle of the Moving averages (Up, down or flat).

 The position of the price relative to the Moving average (above, below or touching).
 A combination of the angle of the RSI, the RSI readings position relative to the 50 line or whether the
RSI has made a meaningful trendline violation.
 Whether a meaningful trendline has been violated when looking at all 3 of the currencies used:
EURUSD, USDJPY and EURJPY.
The more you use this system, the more you will realise that it has been designed to achieve 2 objectives.
1 It allows you to enter successful trades when the market is ready to give them, and,
2 more importantly, it keeps you out of unsuccessful trades when it is dangerous to trade the market by not
giving you trading signals.
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7. TRADING THE “WITH ALL THE ODDS” SYSTEM
Please bear in mind that the FOREX “With ALL the ODDs” system is a “with the trend” system. Therefore you need to
become a total expert at spotting the start of a trend, when a trend will continue and when the trend is likely to
end. Let the trend be your friend until the end.
The FOREX market is mostly a random market where ANYTHING can happen at any time. The principles of this
system however have identified characteristics of the market that repeat themselves and give us the best chance of
success.
7.1. Entries
Entries can take place at the start of a trend, as it continues and when there is a pullback in the existing strong trend.
As you will see volume plays a role in all three.
1 At the start of a trend
As we know volume increases dramatically when a trend is about to stop. An increase in volume during a trending
market on all 3 or 2 of the currencies is a good sign to trade the other way. With experience some traders enter on
this fact alone – this is high risk and requires experience to judge the exact turning point. You can trade these trades
but I would suggest that you use the increase in volume as a signal of a change in trend (not your trading trigger).
Many of you will know from my “Long Candle Course” (www.longcandleforextrading.com) that the only trigger I use
is a trendline violation or bounce. Therefore I would suggest that you use a trendline violation on all 3 currencies (if
possible) as your entry trading signal. At that point the RSI and Moving Averages should confirm the decision.
Please view the Magic Moving Average technique later on in the book for more entry techniques:
 Reversal candle formations
 Reversal price formations
 Strong support and resistance breakout failures
 Wave Counts
 RSI Trendline violations
 Price Trendline violations
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2 During a trend
When a trend is in progress it is often the most difficult trade to enter. The trendline may already have been violated
for some time. The system however gives us some confidence. As long as the RSI and Moving averages are
confirming the trend in the same direction and there was a trendline violation, it is good to trade in the direction of
the trend. The most important thing to check is to make sure there is not a big increase in volume as this would
naturally signal a reversal signal. You would simply enter where the price is at the time or you would wait until the
price makes a new high or low in the direction of the trend.
3 After a small retracement during a trend
This is a favourite technique used by professional traders. They love trading in the direction of the trend after a
retracement. This technique is used for slow swing trading and is the basis of Fibonacci trading. It also has great risk /
return ratios.
By using this system we have a fantastic edge (volume) that you may not have experienced before!!
What normally happens is that a strong trend develops as a result of a trendline violation or a huge increase in
volume. The price starts trending beautifully on low volumes. Suddenly the contrary traders wakeup and decide that
enough is enough and they pump huge amounts of orders into the market to stop the trend which we see as an
increase in volume and a sign to get out of the deal.
The market stops and starts reversing on low volume. This reversal is not very strong and soon starts running out of
steam (Momentum). Suddenly there is another big increase in volumes. This increase in volume will push the price
back into the direction of the original trend and is very, very powerful. It is one of the best trades in Forex. When
you trade the system you will soon realise that there is a 15 to 30 second delay between the increase in volume and
the reversal and that will give you enough time to slip in an order in the direction of the dominant trend. You could
possibly trade to the previous high / low or beyond. Master this trade and you will be ahead of 95% of traders. Now
we have volume to help us.
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7.2. Exits
Exits are the opposite of the entries if you are managing the transactions. There are however other times when exits
are decided before the deal is entered – these are stops, targets and following stops.
1 Stops
Generally I like using 14 or 16 pips as a stop level for the EURJPY. 16 pips normally allows for 1 wave of 1 minute
trading to go against me. It is sometimes much better to exit a transaction the moment a strong reversal signal
occurs such a huge increase in volumes. This normally allows 15 to 30 seconds for you to make up your mind and
exit.
16 pips is not always a good stop for inexperienced traders who often enter the original transaction too late. Also if
you are only going for 5 pips on successful transactions and have a 14 or 16 pip stop your risk/return ratio is not
good.
Anyway, if you are using a stop you will exit your transaction when your stop is touched or if the price jumps through
your stop which may cause some slippage.
I like moving my stop to +.5 of a pip when the transaction goes positive enough for me to do that. This means that in
most cases at worst I will still be positive and I can give the price more room to move until it encounters resistance to
the trend.
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2 Targets
Sometimes it is easier to use targets to exit a transaction positively rather than using manual methods. The price
sometimes can spike into your target and then retrace. In general the stronger the trend the less the need for targets
as the trend can continue for a long time and you could end up paying the spread too often. Small targets are good
to use in a low volatility market where the trend is not that strong or obvious.
3 Following stops
Following stops are very good in strongly trending markets where I often have no target at all and merely follow the
price with a mechanical or by manually moving stop.
4 Reversal signals
By now we all know what reversal signals are. A big increase in volume is the 1 st reversal signal – after that the RSI
angle and Moving average angle will confirm the reversal and then crossovers on the MA, RSI and trendlines are the
last reversal signals.
7.3. Staying in a deal
When the signals start going against your deal don’t stay in it. The most dangerous signal as you know by now is a
strong increase in volume. This is a signal that the trend is likely to be halted or reversed. It is better to get out of
your deal and join the trend later when the trend resumes. Often you can join the trend at a better price later.
Stay in the deal when all the signals are supporting it. Especially if the deal is trending on decreased volume.
Decreased volumes is the number one reason to stay in the deal. It is only a clear or exceptional increase in volume
that will cause a reversal, so even if there is a mild increase in volumes, don’t over react.
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8. TRADING TECHNIQUES AND CHEATS:
Please only start using the trading techniques when you are comfortable with the basic 9 chart system of trading the
“With All the Odds” system using a 5 pip target and a 14 pip stop
8.1. Trades based on 6 charts:
Some traders who use this system have reduced their charts to only 6 charts using only the 1 min and 5 min charts of
the EURUSD, USDJPY and EURJPY. This gives more trading opportunities and does not increase risk excessively. They
would look for total alignment on the 1 minute and 5 minute charts.
8.2 5 Pip move stop strategy
Instead of closing all your lots at +5 pips I often cash in 50% of my lots and then move the stop to breakeven or -4 for
the balance. I am then in a “no lose” situation with an unlimited upside. This is very good in a strongly trending
market.
8.3 Using more sensitive indicators
Using a 2 moving average with an offset of 2 will give more sensitive signals but could lead to whipsaws. You would
have to experiment with this alternative. No need to change the RSI as it is reasonably sensitive. Increasing the
sensitivity on indicators is especially good for EXITING deals.
8.4 Trade the Payroll announcement breakout 5 times a week
Back in the good old days, the Payroll announcement at 8:30 EST on the first Friday of every month was a great way
of making money. Some broker systems were slow, so you had this one way break which tended to run over 100 pips
in 2 to 5 minutes. We would merely straddle the price before the announcement and cash in when the price took our
order and hit our target. These days the spreads are increased considerably before the announcement and the
system, they are better at recording the actual whipsaws that occur before the price heads in a particular direction.
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The same type of thing happens quite regularly in the EURJPY at the start of the Asian Market – only in slow motion
so trading the breakout is so much better. Many times the price in the 1 st hour of the Asian session is also the high or
the low of that day.
The same principles apply – trade the trendline breakout when all 3 the currencies are trading in the same direction
with the RSI and Moving Averages confirming. Only this time trade with many lots to start with or add more lots as
the breakout is confirmed. Use a following stop that gives the price enough space in the beginning (15 to 20 pips)
and tighten the following stop (10 pips) as the move appears to be losing momentum. Cash in lots as the move
progresses to ensure a profit.
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9. A TRADING DAY WITH BARRY (HOW TO TRADE THE PHASE 1 WATO II SYSTEM)
One on the best ways of describing the system is to spend a day with me as I trade the system. I will do my best to
describe my thought process. Hopefully this will give you an idea of the trading plan I follow.
I start my trading day with a quite cup of warm tea. I like being relaxed and happy when I start trading. This is just
before the Asian market at 09:00 AM Tokyo time. Please use http://www.timeanddate.com to work out how these
times relate to your personal time zone.
I load my charts and clear all old trendlines and information off them. I have a brief look at the day’s announcement
schedule to see if there are any times I need to be cautious of (don’t trade).
http://www.forexfactory.com/calendar.php
I then draw the weekly, daily, 4hr, 1hr, 30min and 15min trendlines on the 15min charts of the EURUSD, the USDJPY
and the EURJPY. While doing this I get a good idea where support and resistance finds itself. By looking at all these
charts I also get a feel of what the market is doing – is it trending, flat, and undecided and also what it has recently
done. It could be acting out some recent sell or buy signals. I am pretty fast and all of this takes less than 10 minutes.
I use the 3 basic indicators mentioned in the course – Moving averages, the RSI and trendlines to give me ALL the
trading information that I need. The most important item to look for is for the EURUSD and USDJPY to trend in the
same direction – either North or South.
In spite of this analysis the big unknowns every day are:
 Will the market trend?

 If it trends which way will it trend?
 Will the market trade sideways?
 Will the market whipsaw from a buy to a sell moment to moment?
 Which trading strategy will I use ( 5 target 14 stop or – no stop no target or – 50% 5 pip target and 50% no
target)
To tell you the truth I have no idea what the answers to these questions are when the Tokyo market opens. Every
day is an exciting surprise. What I do is I let the market tell me what it is and wants to do (what else can I do?) using
my indicators and volume information. There is a marked increase in volume when the market opens (remember
that 100% of market is traded by people, even if some are computer programmers). If there is a trendline violation at
that point I might enter straight away, otherwise I will give the market 10 minutes to settle down.
From then on it is 100% focus on the charts and volumes. If at any point there is an alignment in trends between the
EURJPY and the USDJPY I will consider trading and scalping 5 pips. In the beginning I trade a lower number of lots
until I have a better feel of what the market is up to. Remember I am looking for a strong trend but in the meantime I
will scalp short trends using the no stop no target method or the 5 target / 14 stop methods.
When a trend develops I will increase my lots, stay in the deals longer (using the no stop and no target method). If no
trend develops I will keep my lots low and keep on scalping for 5 pips.
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This goes on for 2 to 3 hours (Which fly past in an instant). At that point I decide whether it is worthwhile continuing
or calling it a day. The factors I take into account are: My mental alertness, the state of the market, the money I have
made up to that point, how much of my budget I have achieved (I go for 20 to 40 pips a day).
In a trending market I will keep on trading until the trend runs out of momentum. The beauty is that the EURJPY can
some times trend 100 pips without a major retracement – on days when you have used the 50% cash in, 50% no
target method I can make my whole week’s budget in one trend.
The more you use this system, the more you will realise that it has been designed to achieve two objectives. It allows
I try not to go past 3 hours as my focus and concentration starts to dip.
My trading plan includes the following main principles:
 Let the market tell you how it wants to be traded.

 Be flexible and adaptable about the strategies you are going to use.
 Increase your lots in more certain markets (trending) and decrease your lots or don’t trade in uncertain
markets.
 Put 100% trust in your indicators and charts.
 Have an easily achievable daily and weekly pip and successful deals in a row budget/target.
 I don’t consider money while trading – I measure my success by number of successful deals in a row,
technical competency, number of pips harvested.
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10 THE “With ALL the ODDs II” PHASE 1 TRADING PLAN
Do your charts setup for the EURUSD, USDJPY and EURJPY on the 1
minute, 5 minute and 15 minute timescales so that the Moving Averages, RSI and
Trendlines are easily visible. SEE the section on Screen Layout.
Trade in the Asian market time.
Spot favourable trading conditions where the EURUSD and

the USDJPY are trending in the same direction or in the same phase. Use the:
 Moving averages: angle of the moving average and the position of the price
relative to the moving average.
 RSI: the zone the RSI is in or a recent trendline violation.
.Recent Trend violations
ENTER the trade (pull the trigger) Select which

using
trading risk
1. a trendline violation or
2. when the price in making a new low or high management
at the same time ensuring that there is not a strong increase in strategy you are
volume just before you enter (Trendline violation exception)
going to use:
3. or if there is a retracement with a volume increase
pushing the price in the direction of the trend. 1. Fixed 5 pip Target and
14 pip stop.
In general you should stay in the trade as long as volume is
decreasing or not increasing sharply. 2. Cash in 50% of lots at
+5pips and move the stop
S to breakeven for the rest.
3. Manually manage the

EXIT the trade using target and stop.
 A strong increase in volume.

 When you see entry signals to trade in the
other way: Moving averages, RSI and Trendline
violations. Repeat
 When the price hits your Stop.
 When the price hits your Target.
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11. TRADING TIPS
 Always trade what you see on the charts – they a 100% reality – don’t trade what you think the market will
do – trade what the market is telling you it is doing at that moment. Seize the moment with full focus (carpe
diem).
 Always concentrate on the technical aspects of getting as many successful trades in a row (Never think of the
money). That is what Tiger Woods does on the first shot of a new tournament. He plays one shot at a time
and plays it to the very best of his ability.
 Don’t trade while you are tired.
 Don’t trade when you desperately need to make money.
 Don’t trade in a distracting environment that will impact your concentration and focus.
 Don’t trade with your own money until you are ready – demo 20 to 30 successful deals in a row x 2.
 Use very conservative money management in the beginning – 1 lot until you have traded +20 successful
deals in row.
 If you find yourself becoming anxious and panicky at any point stop trading and go back to demo trading or
stop trading for the day.
 Demo trade the US and UK market using this system. It will prove to you that the system does not work as
well in these markets but more importantly it will make the Asian market feel so easy.
 Experiment with the variations and cheats until you create the system you feel most comfortable with
 The market is random and will do what it will do. You can only do your best to trade it when the odds are
mostly in your favour. Respect the market, as it is always right, and remember that NOTHING is guaranteed.
 Don’t take chances – always have very good reasons to enter every trade.
 Remember that patience is a virtue.
 When the market starts trending strongly trade aggressively. Many lots and many trades. You need to
capitalise on moves when they happen.
 When the market is trading sideways and in an undecided way trade very conservatively – small lots and few
trades. Alternatively don’t trade at all.
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12. IMPLEMENTATION PLAN
12.1. Readiness knowledge checklist before Demo trading
The checklist below has been added to test your basic understanding of the system and the tools to use the
system. The answers are at the end on the eBook
1. Which market conditions need to be in place before you can even consider a trade (when using the 9 screen
method)?
2. What are the triggers for this system?
3. What data do you need to check just before pulling the trigger (Clicking on an order)?
4. Name the 3 warnings we get from watching the volume levels?
5. Which 3 entry methods do we use?
6. When is the Moving Average giving a sell signal?
7. When is the RSI giving a sell signal?
8. When is it safest to enter a sell transaction using volume?
9. Name the 4 ways we exit transactions when trading this system?
10. How many successful trades do you need to do before moving to a live account?
11. Which Forex time zone is best to trade this system?
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12.2 The next action: PRACTICE
This most probably the most important part of this system.

This is where you develop the mental side of this system. Sitting in front of a trading screen, concentrating for 3 to 4
hours a day may not be something that you have been doing. You need to build up your mental and concentration
muscles – this is more difficult than you may think.
It might even take a change of environment to ensure that you are not interrupted while trading. I can’t tell you how
many deals I have lost due to an innocent, unexpected 10 second interruption which caused me not to enter or close
my deals at the right time.
Watching every tick on the 1 minute charts of the EURUSD, USDJPY and EURJPY and how volume causes some of the
moves, develops a 6th sense or an uncanny trading intuition over time (1 to 2 weeks if you have been trading
actively). This aspect is very difficult to explain – this 6th sense keeps you out of dangerous deals when all the signals
say trade and puts you into successful deals that are not 100% aligned with the signals. This is where you take the
trading guidelines of the system and make them your own. You will notice little (personal observations) things not
mentioned in this eBook that happen over and over again and that you can capitalise on.
This is where you develop your own way of selectively entering transactions and creating a high success track
record. Understanding the technical contents of this EBook is not enough – it is totally useless if you are not going to
apply the knowledge.
The more you use this system, the more you will realise that it has been designed to achieve 2 objectives. It allows
Remember you have to develop a skill to identify successful deals using volume and trends that you may never have
done in your whole life so it may not happen immediately. You are going to have to develop these skills by using the
concepts of this system and lots of practise.
Remember, once you have mastered the system the skills will stay with you all your life. It is a bit like learning to ride
a bicycle, except that you may have to fall a lot more in the beginning.
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12.3 Process
 Make sure you have read and understood the contents of the eBook.
 Setup your charts as recommended in the course.
 Do demo 10 trades and record any experiences you may have.
 At this stage send 1 support email asking any information you need to assist with the system.
 Only once you are perfectly happy with the system would I suggest that you move onto a live account using the
smallest lot size you possibly can. Your objective should be to achieve a good success record before increasing
your lot size. If you are battling with the live account go back to demo trading.
Remember you have to develop a skill and mental strength and fitness to selectively identify successful deals using
volume and trends that you may never have done in your whole life so it may not happen immediately. You are going
to have to develop these skills by using the concepts of this system and lots of practice. Remember-Once you have
mastered the system the skill will stay with you all your life.
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12.4 Unsuccessful trade check list

When you have done an unsuccessful trade it is likely to be because of any of the reasons below. You can also use
this checklist and an ENTRY checklist.
1 Are you trading in the Asian Market Time Zone?

2 Are all 3 currencies and all 3 time frames in the same phase as which you are trading?
3 Are you entering too late? (Has the price moved 5 pips since you decided to enter)
4 Have you traded just before, during or just after a strong increase in volume in any of the 3 currencies?
5 Are you using a trendline violation, a new high or low or joining a very strong trend as your entry techniques
(Triggers)?
6 Are your indicators set up correctly?
7 Are you trading in a sideways market? (Biggest cause of failure)
8 Are you trading in a softly or strongly trending market?
9 Are you over trading?
10 Are you tired and need a break?
11 Have you become over confident?
Remember the market will always do what the market will do so sometimes in spite of following the system perfectly
there will be occasions when trades fail.
One on the major causes of failed deals is being caught in a sluggish sideways market that goes no where. Generally
it is better to avoid trading when the market is showing no volatility as a sideways market can very quickly wipe out
any previous gains made. Don’t be over anxious to trade every day.
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13. MONEY MANAGEMENT AND DOUBLING OF YOUR ACCOUNT

Please read this chapter after have achieved a high level of successful trading the WATO II system so as to gain
maximum benefit of the information presented.
Money management is all about balancing your risk and your rewards in order to protect your long term survival in
the Forex Trading Market. The biggest factor impacting your money management is your success rate. The higher
your success rate the more aggressive and more manageable your money management. When applied correctly this
system results in an above average success rate which gives us more to work with.
The basic system of risking 14 pips to make 5 is not the most favourable one. It means that if to have 2 losses out of
10 your profit will only be 12 pips =(2 x -14) + (8 x +5) and if you have 3 losses out of 10 you will make a small loss -7
pips= (3 x -14) – (7 x +5). If it is giving you 100% success however stick to it.
Over time most traders move to systems that increase the gains to 6 to 9 pips and decrease the losses to 9 to 12
pips. This allows a reasonable gain even if there are a few losses. The closer you can get your risk reward ratio to 1:1
the better. This happens over time and after developing experience using the system.
Assuming a 9 pip gain and a 9 pip stop strategy for instance will allow you to double your trading account after only 3
deals using the maximum lot strategy (see the strategy below).
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When using the 5 pip target and 14 pips stop approach it is better to use the 20 level ladder approach. Successful
deals push you up the ladder and an unsuccessful deal pushes you 3 levels down the ladder. When you have moved
to position 20 on the ladder you will have doubled your account.
There are hundreds of ways people double their account using money management. The ways are only limited by
the trader’s imagination and creativity. The secret is to find the method that helps you increase the number of lots
traded so that you can leverage your gains upwards and that you personally are comfortable with and can stick to.
So, in terms of money management, stick to demo trading until you can achieve a high level of success. Move on to
live trading using the smallest lot size possible and then contact me should you need further assistance.
Achieving the mental discipline to achieve a high level of success is much more important in the long run than finding
ways of making money without knowing that you have the competency to trade successfully.
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14 QUESTIONS AND ANSWERS
QUESTION 1: I follow the trading rules perfectly and although my transactions go positive they do not reach the 5
pip target to cash in.
ANSWER: There are a number of reasons for this: You may be entering on increasing volumes which could be present
on any of the 3 currencies. The EUR and JPY may not be in a strong enough trending phases when you enter. You
may be using “weak” momentum signals (Small movements around the 50 line). You may be entering too late – the
price jumps 3 to 5 pips from the time you “see” the trade. Also make sure you are trading at a time of day that will
normally give good volatility.
QUESTION 2: In today's video it was said that it's not good to draw trendlines on the most recent candles if we're
making new highs or lows. I thought that's what we are supposed to do when the mkt. is trending to get back in?
ANSWER: What we are looking for is lots of (white or empty) space between turning points in the market (see the 1st
drawing). If there is no space the there has not been a real turning point (see 2nd drawing). We like drawing
trendlines over real turning points. If you draw trendline on the latest candles you will find that no space has formed
and you may not have used a turning point (see second drawing). The trendline becomes useless or of less value.
You should also not confuse this with entering when the price makes a new high or low in a trending market – this
concept does not apply as we are not really using trendlines – we are using a concept of new highs or lows in a
trending market.
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PHASE 2
15. USING WATO II IN OTHER MARKETS
When you have are confident using WATO II in the Asian Market on a short term basis using the 1, 5 and 15 minutes
charts of the EURJPY you can move onto the other market such as the European and the US market provide good
trading opportunities using the scalping approach.
The approach is exactly the same as in the Asian Markets. One does have to watch 2 aspects which are different.
Economic Announcements
The European markets have more economic Announcements so the price can be driven by knee jerk reactions and
increased volatility. Sometimes brokers increase the spreads (up to +20 pips) during economic announcements so
trading during these times should best be avoided.
Increased volatility
Due to increased volumes and participation currency movements during the European and US markets become
much higher than those experienced in the Asian market. Trading with a 14 pip spread can be very dangerous and
you should consider trading with a 20 to 25 pip spread in these markets.
As always you should demo trade a new technique in a new market until you are comfortable before risking real
money.
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16. USING WATO II IN OTHER TIMEFRAMES AND USING OTHER CURRENCY

CROSSES
The principles of using multiple time frames and multi currency correlations are obviously not limited to only the
EURJPY and the Asian Market and the 1 minute, 5 minute and 15 minute charts.
Some of the other currency crosses that can be used are:
AUDUSD + USDJPY = AUDJPY

EURUSD + USDCHF = EURCHF
EURUSD + USDCAD = EURCAD
GBPUSD + USDJPY = GBPJPY
AUDUSD + USDCHF = AUDCHF
AUDUSD + USDCAD = AUDCAD
GBPUSD + USDCHF = GBPCHF
And some of the other time frames that can be used
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5 Minutes, 15 Minutes and 1 Hour

15Minutes, 1 Hour and 4 Hour
1 Hour, 4 Hour and Daily
Volume is mainly limited to 1 minute charts so as you increase the timeframes the use of volume disappears.
The placement of stops (and anticipate targets) becomes a little more challenging when using different markets,
currency crosses and timeframes. In general the best guidelines that can be given are:
 The more volatile the currency the bigger the stop required (example the GBPJPY would require double the
stops of say the USDJPY)
 The longer the timeframe the bigger the stop (14 pips for 1 minute and as high as 150 to 200 pips for daily
deals)
 The more liquid the market the bigger the stops (Guide: the US market would require twice the stops of the
Asian market)
 The day of the week ( Thursdays and Fridays sometimes require double the stops than used on Mondays)
The above are guidelines based on the market conditions at the time. The best is to experiment with a demo account
until you find the stop sizes that match your currency, time of day and your current market conditions. Support and
resistance, present when entering a transaction, can also determine the appropriate stop size.
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17 READINESS KNOWLEDGE CHECKLIST ANSWERS
1. Which market conditions need to be in place before you can even consider a trade (when using the 9
screen method)?
The price should be in a sell phase or in a buy phase in all 9 screens. The phases are determined by the RCI
momentum indicators and the displaced Moving average indicators.
2. What are the triggers (what signal will make you enter an order) for this system?
Trendline violations, or if the price is making higher highs or lower lows in a trend.
3. What data do you need to check just before pulling the trigger (Clicking on an order)?
Volume levels.
4. Name the 3 warnings we get from watching the volume levels?
Increasing volumes support the direct trend when important trendlines have been violated.
Increasing volumes reverse the trend in general trading conditions.
Decreasing volumes support the direction of the trend.
5. Which 3 entry signals we use?
Trendline violations or if the price is making higher highs or lower lows in a trend.
6. When is the moving average giving a sell signal?
When the price is below the moving average.
7. When is the RSI giving a sell signal?
When the price is below the 50 line or if there has been a meaningful trendline violation after 2 waves of
the RSI.
8. When is it the safest to enter a transaction using volume?
When volume is low or decreasing.
9. Name the 4 ways we exit transactions when trading this system?
When the price touches the target.
When the price touches the stop.
When the price touches a following stop.
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Manual exit before the target of stop is reached.
10. How many successful trades in a row do you need to do before moving to a live account?
20.
11. Which Forex time zone is best to trade this system?
Asian market at the start of the Tokyo market.
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ADDITIONAL APPROACHES
18 ADDITIONAL WATO II APPROACHES: The Magic Moving Average approach
INTRODUCTION
When using the WATO II system we use the 3 Moving average displaced (shifted) by 3 as the moving
average to tell what the phase a particular currency is in. Whether it is in a BUY or SELL phase. Please
see section 5.1 of the WATO II eBook for more information on the WATO II uses of the moving Average
indicator and how it is setup. The fact that we displace this Moving average by 3 periods into the
future turns this lagging indicator into a MAGIC leading indicator by providing
valuable dynamic support and resistance information.
During our LIVE trading webinars in the US and Asian Markets Expert4x has
noticed this Moving average provides great entries into, and out of quite sizable
trends on the 5 minute charts in particular (Example: The chart on the left where
80 pips were captured out of a 110 pip move).
The biggest advantage that we noticed is that it keeps you in the trend very well as
well as offering good exits.
It also stops the over management of the deal that occurs when using the
conventional WATO II 9 to 14 pip target techniques.
One of the biggest disadvantages of using the moving average cross over system is
that whipsaws in the market can cause losses. Using the 5 minute charts in the
early US and Asian sessions has been very good as this timespan seems to produce
good trends. See a discussion on when trends can be expected later on in this
eBook.
WATO II MAGIC MA TRADING PRINCIPLES
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In the WATO II system the MA are basically used to tell which phase the price is in. This means that we
are using the MA as a dynamic support and resistance line to separate the buy phases from the sell
phases.
Therefore, any time the price crosses over the Moving average it creates a potential trading
opportunity. These crossovers could also create both entry signals for new transactions and exit
signals for a possible current transaction.
WHEN TO USE THE MA STRATEGY SYSTEM
The Magic MA strategy can be used when trading EURJPY when there is WATO II alignment of the
EURUSD and the USDJPY.
You can also use the Moving Average on the EURUSD and the USDJPY when trading the WATO II free
style system when there is non alignment.
In the US session we have been trading the GBPJPY as a WATO II

currency so the same principles would apply to the GBPUSD, the
USDJPY and the GBPJPY.
THE WATO II MAGIC MA SYSTEM
Very simply:-
1. When trends are likely to begin on the 5 minute chart

(see the next section for ideas)
2. you ENTER a trade when the price crosses over the

moving average
3. and you STAY IN THE TREND as long as the price does

not close on the opposite side of the moving average
4. and EXIT when the price closes on the other side of the
moving average.
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WHEN ARE TRENDS LIKELY
1. After reversal candle formations
For more information please go to http://www.forextrainingvideos.com/ and search for “Forex candles”.
This particular reversal candle formation is quite

a strong one. The setup candle (the blue one)
makes a spike and retraces. The next candle
makes a bigger spike and retraces past the close
of the previous candle causing the candle to
change colour. This gives more certainty when
the price eventually crosses over the moving
average.
The candle formation is an Evening star

formation where there are 3 spikes. The middle
one is the longest and third candle then starts
reversing. This is at the end of an up trend. At
the end of a down trend the formation is called a
morning star and is just reversed.
These formations can be equated to the Head

and shoulders reversal formation as the same
price movement occurs when the head and
shoulders appear.
Spikes are very good reversal signals that make

moving average crossover trades less risky.
Remember that Railway track candle formations,

as shown in the lower chart, are nothing more
than a spike when added together so treat them
as spike reversal signals too.
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2. After reversal price formations
A double top (or a double bottom) is a

great reversal formation at the end of
a trend. There are many more.
This example shows how the price

closed below the moving average
after a double top formation adding
more importance to the moving
average crossover.
3. Strong support and resistance breakout failures
When the price continuously tries to break

through support or resistance and can’t
break through, it will eventually start
trending the other way. More importance is
given to the moving average crossover when
this happens.
In this example the price tried a number of

times to break through the upper resistance
as evidenced by the many spikes, and when
it changed direction it crossed over the
moving average creating a sell opportunity.
4. Wave counts
Experience has shown that good crossovers

through moving average lines normally have
2 or more well formed waves. These waves
are sometimes visible on the price chart as
shown on the RSI indicator.
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5. RSI trendline violations
In this example of the USDJPY

5 minute chart you can see
that the RSI indicator (set at a
4 setting) not only helps us
count the waves in price
movements but also provides
trendline violation
opportunities.
When the RSI has a trendline

violation which happens either
before or at the same time the
candle cuts through the
moving average, you can
regard this as a confirmation
signal to trade the moving
average crossover.
6. Price trendline violations
Please click on this link for more information on trendlines http://www.metaquotes.net/techanalysis/trendlines/
More importance is given to moving average

crossovers if they are accompanied by a
trendline violation before or just after the
moving average crossover.
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7. Volatile market times
The volume information shown below shows the volumes and volatility generated by the 3 major forex markets.
These high volume periods are often when trends develop and the Magic Moving Average works well in trends.
OTHER WATO II CURRENCIES
We are currently trading the following groups
EURUSD + USDJPY = EURJPY
GBPUSD + USDJPY = GBPJPY
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19 ADDITIONAL WATO II APPROACHES: The Free style method approach
INTRODUCTION
Most of the principles as explained in the WATO II ebook apply to this technique and we will only
focus on the differences between the “WATO II Freestyle” technique (when there is non alignment of
the currencies) and the normal WATO II technique (when there is alignment). Make sure you
understand the basic WATO II techniques as explained in the WATO II ebook well, as they are not be
repeated.
From earlier in this Book the instructions are
When not to trade:
 Do not trade when the trends on the EURUSD and USDJPY conflict
o They conflict if:
 The price is not on the same side of the Moving Average for both currencies
 The RSI is not in the same mode for both currencies
This applies to all 3 time frames: - the 1 minute, 5 minute and 15 minute charts (we do sometimes ignore
the 15 minute charts when the market has fast changing trends)
When the US dollar is the dominant currency it is quite natural for the EURUSD and USDJPY to trade in
opposite directions. This means that there can be extended periods when the WATO II system can not
be traded – this can be frustrating.
That is why we have introduced the WATO II Freestyle system.
The WATO II Freestyle system applies when either the EURUSD or the USDJPY is trending or has
strong potential to trend but there is non alignment between them (they are not trading in the same
direction). The freestyle rule therefore is:
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When the trends of the EURUSD and the USDJPY are not aligned and the EURJPY does not
qualify to be traded under the WATO II alignment rules we can trade the EURUSD or the
USDJPY as individual currencies.
Non Aligned WATO II currencies (The WATO II Freestyle method can be traded)
We would therefore use the same trading principles that we use to trade the EURJPY (under aligned
WATO II) as we would to trade the USDJPY or EURUSD as individual currencies. Under the WATO II
Freestyle rules we would therefore ignore the correlation between the EURUSD and the USDJPY and
therefore the EURJPY.
Please note that we do NOT trade the EURJPY under WATO II freestyle as the volatility of the EURJPY
will be reduced in circumstances of non alignment.
WATO II TRADING PRINCIPLES
When trading the EURUSD or the USDJPY on their own (under non alignment conditions) one would
apply the following principles:-
1. What differentiates WATO II from most of all other techniques is the use of volume to enter or
exit transactions. Increased volume, in general, is a warning not to enter a trend whereas
decreasing volumes make it safer to enter trends. This would apply when trading the EURUSD
or the USDJPY. (See the main course for information on this).
2. Although the Moving average is used to determine the phase a currency is in, when the price
moves over the moving average (especially on the 5 minute chart) it is a signal for a potential
change in trend. This move, once confirmed by either a candle close on the other side or a very
strong trending price movement, can be used as a possible entry signal. Alternatively this
crossover can be used to indicate a change of phase. (See earlier in this eBook). Please refer to
one of the other additions to the WATO II ebook – WATO II Magic MA.
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3. The main entry criteria is predominately still a trendline violation on any of the price charts
showing a break of non horizontal support or resistance. (See earlier in this eBook for details
and examples)
4. A break of the horizontal support and resistance lines (which generally would occur on all
1min, 5min and 15min charts) is also a valid entry point - especially when the market is
trending. (See earlier in this eBook for details and examples)
5. The RSI provides trading signals when there are good trendline violations or the 50 line is
violated. (See earlier this eBook for details and examples)
LOT SIZING TRADING STRATEGIES
In the live trading session we use 2 main approaches (see Section 8.2 in the main eBook):
1. We enter using multiple lots (more than 1) and close 50% of the deals at +5pips. You can then
move the stop on the rest of the deal to either breakeven and thereby ensuring a positive result
for the trade OR to -4 pips so that you give the deal enough room to move more positively
(This way you would make a small gain if your stop is hit).
2. Alternatively you could move the stop to breakeven when the price goes +5pips so that you
have a no loss deal and then you can let it run until you see reversal signals.
OTHER WATO II CURRENCIES
We have created LIVE WATO II sessions in the US market – in addition to the EURUSD and USDJPY
alignment to trade the EURJPY, we also use the GBPUSD and the USDJPY alignment to trade the
GBPJPY. You could therefore use the GBP as an independently traded currency if there is non
alignment of the GBPUSD and the USDJPY.
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CHART LAYOUT
You would use the normal WATO II chart layout but focus on the currency you are trading. In the
example below the trader may choose to concentrate on the USDJPY charts (Highlighted in Green) as
the market is not aligned and WATO II cannot be traded.
WATO II FREESTYLE CURRECY SPREADS
Always use spreads are still low enough to provide good scalping opportunities. The GBPUSD is a
slightly more volatile currency so consideration should be given to use larger stops and targets e.g. 14
pips. Stops and targets for the other 2 would normally be reasonable at 9 pips.
Be careful of spread increases by Brokers at times close to major announcements.
TO SUMMARIZE
When the EURUSD and the USDJPY are trading in different directions we can no longer trade the
EURJPY using the alignment principles.
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We can then trade the WATO II Freestyle system
• Ignore the USDJPY, EURUSD and EURJPY correlation.
• We trade either the EUR or the JPY on their own merit as individual currencies using the WATO
II trading technique. This means:-
– Volume based entries and exits on 1 min charts
– RSI based confirmation signals
– 1 min, 5 min and 15 min charts
– Support and resistance and trendline entries
– Moving average confirmation signals
The USDJPY and the GBPUSD are also WATO II currencies that can be traded using the above method
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20 ADDITIONAL WATO II APPROACHES: The Dominant chart profile approach
This approach is very closely related to the Free style approach.
The “With ALL the ODDs” technique requires both the EURUSD (EUR) and the USDJPY (JPY) to be trending in the
same direction in order to enter a trade on the EURJPY. There are however times when the EUR or the JPY is trending
quite strongly and the other currency is not doing that much. Using the dominant chart profile approach gives one an
opportunity to trade the EURJPY at times when both the EUR and the JPY are not trending in the same direction.
Market Behaviour
When viewing the 3 (1 minute) charts of the currencies used to trade the “With ALL the ODDs” technique there will
be times where EURJPY resembles either the JPY or the EUR very closely. In general the EURJPY resembles the
JPYUSD chart during the Asian session. The EURJPY often resembles the EUR during the Europeans and the US
sessions. The best charts to use to see this are generally the 1 minute charts in reasonably condensed setting. Below
are examples of this:
Below is the EURJPY. Clearly the JPY was the dominant currency at that time.
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Below is the EURJPY during the UK session 1 hour before the US market open on the same day. Clearly the EUR was
the dominant currency at that time.
You should be able to get this information from your standard “With ALL the ODDs II” chart setup.
How to use this technique

When you find that the EURJPY is adopting the profile of either the EURUSD or the USDJPY, the profile it is adopting
strongly becomes the DOMINANT currency. That means the other currency is not contributing to EURJPY profile that
much and is therefore the less dominant currency. That could be because the less dominant currency is not trending
at all or that it is trending very weakly.
When this happens you can trade strong moves on the dominant currency charts and / or the EURJPY charts and pay
less attention (or ignore) signals on the less dominant currency (as long as the less dominant currency is not trending
in the opposite direction to the Dominant currency).
It is therefore only necessary to check that the less dominant currency is not trading in the opposite direction of the
Dominant currency. If it is not you can trades trading opportunities based on the “WATO II” trading rules (Volume,
trending as shown by the moving averages and RCI etc) ignoring the less dominant currency.
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21 ADDITIONAL WATO II APPROACHES: The WATO II “CATCHING THE

FALLING KNIFE” TECHNIQUE
Introduction
The “Catching the Falling Knife” technique is an additional, but separate technique to the “With ALL the ODDs II”
system (WATO II) and it is assumed that traders will already have a good working knowledge of the WATO II system
when reading this.
The “With ALL the ODDs II” trading system is successful because it trades when there is a trend or movement by the
EURUSD, USDJPY and the EURJPY in the same direction which causes a break through of support or resistance or a
trendline without a huge increase of volume. By making sure that the EURUSD, USDJPY and the EURJPY are showing
trends in the same direction on the 1 minute, 5 minute and 15 minute charts (using confirmations for the RSI and
Moving Average indicators) more certainty is given to the move and it also increases the volatility in the EURJPY
which is then scalped for 5 to 10 pips.
So the key warning not to enter a deal when using the WATO II system is if there is a sharp increase in volumes prior
you anticipating an entry. Increased volume increases the probability of a trend reversal considerably and that is why
this becomes unsafe. Increased volume generally will either, slow a trend down, stop it or reverse it. In very unique
circumstances where major support/resistance/trendlines are violated or economic announcements increased
volume will support the direction of the trend.
The WATO II “Catch the Falling Knife” forex technique was born from this exit signal. All that has happened is that we
have increase the conditions under which we would turn this exit signal into a great entry signal. In other words a
very strong increase in volume could be traded as an entry signal.
The WATO II “Catching the Falling Knife” forex technique

On Wall Street there is a saying: - “Those who try to catch a falling knife only get hurt”. This refers to the investors or
traders that try to catch all the turning points were stocks will reverse very precisely from mainly a downward
movement.
Traders of the “With ALL the ODDs II” trading system use volume to warn them when a likely reversal could happen.
By studying this phenomenon in live trading in the last few months traders have notice that certain volume increase
don’t only reverse a trend but actually start a strong trend in the other way.
You only need the 1 minute charts and the 1 minute volume indicators to do this trade (No other indicators or charts
need to be referenced). So you can use the WATO II chart setup as it gives this information and ignore or the other
information on these charts.
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So when is this strong reversal of trend likely?

The conditions are simple:
1 The EURUSD, USDJPY and the EURJPY are trending in the same direction. This trend should be definite but
not extremely strong such as experienced after an announcement or major support or resistance
violation. At the same time the trend should not be so weak that one can hardly notice it.
2 They are approaching strong support or resistance – especially the EUR and the JPY.
3 There should be a very big increase in volume on both currencies at the same time. Volume becomes 2 to3
times that of the volume bars preceding (1 to 3 bars) the volume increase bar OR constantly high volume
for at least 2 to 3 bars which are 2 to 3 times higher than the previous bars.
An example of the above conditions:

1 The EUR, JPY and the EURJPY are trending down wards approaching support levels.
2 They are experiencing a strong increase in volume at more or less the same time
RESULT: ALL reverse with the strongest reversal occurring in the EURJPY
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When to enter?
This trade is often referred as a trade where the trader is trying to catch a falling knife. That is because you are
trading directly against the trend you are totally relying on the support or resistance to bounce the price back based
on the huge increase in volume.
Therefore there are 2 entry points –
1 At the price just before or at the support or resistance levels mentioned above
2 When the first indications of the reversal occur.
Frequency
As you can see the conditions are fairly stringent on when trading criteria are met. These trades therefore do not
occur that often and when they do you have to re-act very quickly.
Having said that any increased volume exit point when trading the “With ALL the ODDs” system could potentially be
a “Falling knife” trade.
Other currencies and markets

Bu using the EUR, JPY and EURJPY we are using the 1 minute charts of currencies that are correlated. You can
therefore trade any correlated pair in any of the Asian, US and UK markets using Falling Knife system if trading setup
conditions are met.
Some correlated pairs are (The 3rd pair is twice as volatile when the other 2 trend in the same direction):
 EURUSD + USDJPY = EURJPY

 GBPUSD + USDJPY = GBPJPY
 GBPUSD + USDCHF = GBPCHF
 AUDUSD + USDJPY = AUDJPY
 EURUSD + USDCHF = EURCHF
Below is an example of using the GBPJPY which resulted in a slightly longer trend
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Technique to trade falling knife technique

Depending on the volatility of the currency you could enter these deals with a 14 (GBPJPY) to 9 pip (EURJPY) stop
with no target. Move the stop to breakeven when the price reaches +9 pips or +14 pips and then manage the exit
based on how the price movement presents itself and what your daily goals are.
Closing Notes
This is an opportunistic trade that must be used with caution. It is not a trade that you set out to trade as trading
opportunities may or may not occur that often. It is therefore better to trade the “With ALL the ODDs II” system and
let “The Falling Knife” Opportunities present themselves when the unique market conditions present themselves.
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It is also suggested that you only trade this technique when you have mastered the basic “With ALL the ODDs II”
technique.
The more you trade the “With ALL the ODDs II” system the more you will develop a good feel for when increased
volumes will help you trade bounces off strong support and resistance.
These notes will be incorporated into the “With ALL the ODDs II” ebook at its next update.
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22. I NEED YOUR HELP!

Not knowing who is going to read this eBook makes it very difficult for me to decide what to include and which areas
to stress more than others.
Please send me any questions, observations, comments, criticisms, complements etc that you may have regarding
this eBook. info@expert4x.com
You will be helping me, yourself and your fellow Forex traders immensely as I will do my best to include any
improvements in the next version of this eBook. The new version will be automatically sent to purchasers.
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23. SUPPORT
Emails: Should you have any questions please forward them to info@expert4x.com. They will be answered through
Mary McArthur were appropriate. Barry Thornton will answer any questions of a more advanced nature.
THANK YOU FOR PURCHASING AND

READING THIS EBOOK
I HOPE YOU FIND THESE FOREX

TRADING CONCEPTS AS
REWARDING AS I HAVE FOUND
THEM TO BE
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Course WATO

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Forex Trading

“With ALL the ODDs II”

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2 During a trend ............................................................................................................................................. 41

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Click here to view videos

1. Selecting a Broker and quick order processing Broker video

2. Chart setup Chart setup

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IMPORT ANT ASPECTS TO BE AWARE OF DURING THIS COURSE

3. WATO II uses a 2 Phase approach:

frames once comfortable with the approach.

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3. THE “With ALL the ODD’s II” SYSTEM SUMMARISED

The system uses 3 indicators to establish trends:

 a 3 x 3 Displaced moving average.

It looks at 3 timespan sets of charts:

 The 1 minute charts.

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Below is the WATO II chart setup.

o 5 Minute, 15 minute and hourly charts or

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o 15 minute, 1 hour or 4 Hour charts.

o 1 Hour, 4 Hour and daily charts.

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4. BASIC SYSTEM TOOLS

 Displaced moving averages.

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Chart setup video

Chart templates and profiles used in the video.

Templates (copy to your MetaTrader templates folder)

Download here> Templates

Download here> Profiles

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There are some solutions to that.

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4.3. CURRENCIES USED AND TRADED

The trend is determined by:

 The angle of the Moving averages (Up, down or flat).

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4.4. MARKET TIMES

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5. INDICATORS AND DATA USED

5.1. INDICATOR 1: A DISPLACED MOVING AVERAGE

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Signals and trading information

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5.2. INDICATOR 2: A MOMENTUM INDICATOR – RSI

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Signals and trading information.

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50% line crossovers:

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