Tuesday, June 01, 2010

Blood in the water ?

Here is my latest post on "The Art of Contrarian Trading".


Kishore said...

The market goes up, it traps a few bulls. Then it goes down to trap a few bears. The primary business of the market is trapping sentimental fools, i.e traders like me and you.

But when 70% of the trading volume is generated by HFT Computers, what do we call "the market"? The faceless, emotionless monsters have no sentiments and they exist only to serve their evil masters, the bankers.

The media reported readings of human sentiments, if at all they make any sense, don't even count anymore when much of the trading is not being done humans.

dcatlowpj said...

Very interesting post, Kishore...those thoughts have prevailed in my mind lately as well....

Fast Money and the folks on TV are using "market forces" based on the thoughts of real people when in essence, the sense of what you are saying is that the trading is technical, based solely on the variables in the software, and that the movements are as robotic as anything we have known heretofore.

I am impressed with your sentiments. Carl is truly presenting as "robotic" a take on the action as any computer but with the advantage of our superior minds.

Well, at least I think so. It is perplexing and frustrating - - what we are seeing and hearing these days.

I also own Maverick an apology as I was a bit rude but then again the price target was so extreme that I thought, "what in the heck can this guy be seeing in today's action that leads his technical analysis down that road?"

Wags94596 said...

With all due respect...

People need to have a thorough UNDERSTANDING of what kind of trading HFT entails before commenting on it.

I doubt that many here have a comprehensive understanding of the various strategies involved in HFT, one of which being arbitrage, another being latency "front-running".

F&H Painting said...

If it's a bull, it's an ugly bull.

VS said...

when solution appears complicated, look at the problem again.

This is not a bull market! Now all price action fit the bill correctly.


dcatlowpj said...

Wags, all we have is what the market makers have allowed us to understand. HFT is a mystery to all of us. All we have heard is that there are trades made quickly, triggered by some very high-speed servers, and that these trades are entered without the human hand or a floor trader...tell us more. Tell us everything you know...I am interested..and I am indeed guessing.

Kishore said...

Arbitrage component of HFT Trading has been around for a long time and no one objects to it. The arbitrage players only skim a little based on discrepancies among indexes and exchanges.

The main reason why HFT Trading is destroying the free market is due to their illegal practices of collusive manipulations and front-running.

It appears some posters just like to wag their tails for their masters and try to perpetuate ignorance.

inversorX said...

HFT is the excuse of the times.

HFT dont move the markets, and as far as we come to read this blog I think we are directional traders thinking about the next big wave.

In carl´s case to 1300 (in my case to 1230), so what HFT have to do is not important for me or for you.

Maybe if you are a scalper not focused in the main movement.

Don´t lets use the HFT as the excuse of our imcopetence.