I have bought Al Brooks' Trading Course

Q3D said:
HFT just predicts and outruns any market participant's behavior, if market participants use technical analysis then HFT would reflect that.

http://www.cftc.gov/ucm/groups/public/@economicanalysis/documents/file/oce_flashcrash0314.pdf
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Huh? seriously, man-- this is very weak and bordering on nonsense---- I am happy to see you here to learn, but acting like an authority on things you know zero about isn't cool.

you have a tremendous amount to learn. Don't risk your money in the market just yet.....

surf

PS-- by the way, several of the folks reading this WROTE the papers you are referencing, so please, this isn't yahoooo.
 
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EPrado said:
Yep. Years ago it was The Specialist........then Floor traders/brokers in the futures pits......now it's Algos and HFTs. People sometimes blame others for their failure or not adjusting to what they are dealing with.
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Adapt or die.. good post, EPrado.
 
marketsurfer said:
Adapt or die.. good post, EPrado.
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Thanks. Traders have to. When I first started trading there were many strategies/edges that worked, but you had to know when it stopped working. It could work for 6 months, 6 years......but the traders who could identify that something major had changed would quickly try and make adjustments, if that didn't work then stop trading the strategy. Back in the early 90's one of the trades that worked great would be to pay close attention to the 30 year bond futures (ZB) close at 3:00 p.m. edt. If they went out strong the bank stocks would be strong the last hour. It worked like a charm for a long time (same thing if ZB went out weak, those bank stocks would be weak). So based on any significant move into the bond close we would trade accordingly. ZB closes strong we would aggressively buy Chase,Chemical, Citi, Bank of NY, BAC, WFC, Bankers Trust, Salomon Bros, Goldman, and on and on. It seemed so easy and worked great. Barring a major move in the SP's against what you were doing , it would work out great. Even when the SP went the other way your positions were relatively strong so you could minimize the damage. Back then a lot of times the banks led the way for SP's, so the indexes would continue to move on bank stock strength. Thinking back now it amazes me how much easier trading was back then.

But then.......it started to not work as well. Then it really became more of a guessing game. Guys who picked up on this, moved on and found other edges/strategies (or continued to put money in the ones besides this bond/bank one that worked). The ones who kept hammering away though got hurt. The more stubborn they got the worse it got.

Ideally today in my opinion it's great to have a strategy that can be used in a bunch of markets. One that can be "turned on" during periods of volatility or whatever makes it work, and "turned off" during periods when it does not work. In my experience volatility is the key thing to look at when deciding whether or not to trade that market. If you can find this then the only real adapting you have to do is adjust to significant changes in volatility and readjust your Profit goals and stops. To me that is huge.
 
marketsurfer said:
Huh? seriously, man-- this is very weak and bordering on nonsense---- I am happy to see you here to learn, but acting like an authority on things you know zero about isn't cool.

you have a tremendous amount to learn. Don't risk your money in the market just yet.....

surf

PS-- by the way, several of the folks reading this WROTE the papers you are referencing, so please, this isn't yahoooo.
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You're saying HFT has no correlation with past price data?
 
Visaria said:
try concentrating only on one specific pattern and look for it on different markets and time frames.
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Excellent advice. Or pick even just one market and one timeframe ... Mark Douglas recommended one would be well-advised to start out in trading by "becoming an expert at just one market behavior."
 
I maintain that the definition of technical analysis is forecasting future price movement based on price history whether that's what happened a millisecond ago or one month back (or longer).

Chart analysis is merely a subset of technical analysis.

I don't know that much about HFT trading, but a little while back there was an interview with a fund in Norway called Intelligent Trading. They utilized HFT-strategies in their infancy and very profitably so, but said that in later times they had moved on to a larger time frame (but still short-term), due to their methods no longer being profitable.

They didn't want to say too much about their methods, obviously, but their background is in mathematics (PhDs a few of them) and they said that it was mostly based on statistics and typically multi-dimensional analysis of convoluted time series.

Sounds like TA to me, although perhaps not in the way most people think of TA, i.e., chart reading.
 
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