85% of retail traders short S&P

[dartmus]

Let's assume institutions, which make up 85-95% of the daily volume on the ES, have charts and metrics (coded data) which display retail intraday ES daytraders' positions at the 1-minute level or less. Would it not be logical to assume that price would move in a "max pain" direction to shake these traders out of their positions? Therefore price action is a dynamic study constantly in flux and dependent upon changing variables, it is most absurd and reckless to try to reify this into a concrete theory.

reify?

absurd!

 

[I Know You]

Yes we're in a pb but it's unlikely to do more than trap some bears before new highs.

You a macro expert now? Whenever market is at crossroads IMO you gotta go with every cycle, be it counter uptrend or counter downside. I view daily cycle as being very close to having completed itself. But...

 

[Buy1Sell2]

Would it not be logical to assume that price would move in a "max pain" direction to shake these traders out of their positions?

Price would not care about max pain to the retail trader.

 

[Buy1Sell2]

Price typically shakes out traders who have poorly placed stops inside the noise.

 

[billyjoerob]

Retail traders just double down, they don't get shaken out of a position because they don't use stops. Here is how a retail trader loses money. He martingales all the time, but always covers/sells too early, tend to lose more on losers than on winners, but he has a positive winning percentage. He maximizes winning percentage and tends to enter and exit positions far too early.

 

[dartmus]

You a macro expert now? Whenever market is at crossroads IMO you gotta go with every cycle, be it counter uptrend or counter downside. I view daily cycle as being very close to having completed itself. But...

No and please note I'm not anywhere near being any kind of expert. I'm constantly learning new things. ...but I can eyeball this trap!..don't have to measure anything to see that much!

 

[I Know You]

No and please note I'm not anywhere near being any kind of expert. I'm constantly learning new things.

I was joking, no offence intended.

 

[dartmus]

I was joking, no offence intended.

I was joking too.
except for the part about learning and eyeballing this trap.

 

[I Know You]

Price typically shakes out traders who have poorly placed stops inside the noise.

I don't entirely agree with your statement, as even if you place your stop entirely outside the noise you could still get squeezed. There is no optimal stop because directional bias is 50/50.

 

[der_kommissar]

I don't entirely agree with your statement, as even if you place your stop entirely outside the noise you could still get squeezed. There is no optimal stop because directional bias is 50/50.

Hardest thing in the world is to figure out optimal stop placement with futures trading...I'll always take an options trade over a futures trade if there is sufficient liquidity (tight bid/ask)...The overnight markets pretty much guarantee stop runs every single night...