I have been away from day trading for many years
... as I look around all I hear is "algos, Quants, high frequency"
.. prop firms going down, Shoenfeld fired people in droves.
What is the truth about trading in today's googly fast machines environment?
Is manual check writing dead? No. banks still give you checks if you order them and businesses and individuals still use them. Many, if not most, HFT firms are trading at the nano second level. That is their battlefield as the fight each other for tiny profits based on the concept of huge volume.
That doesn't really affect very much the trader trading off say a 5 or 10 minute chart. In addition, the algos...etc are based on mathematical formulas. Emotion, to some degree, is being removed from the markets, but, that net effect is to actually make price more precise. You can't best them at the nano second level (not even manually possible) but 5 minute..10 minute...15 minute..well that is all up for grabs.
Just look at a chart pre HTF...PRE ALGO..and compare it to a chart today. Still has trends. Still has pullbacks, Still has ranges. Still has triangles..flags...channels..double tops and bottoms..etc ...ad nauseum. In short, if those things could be traded pre algo...pre hft with profits and they still show up on a chart with post hft and post algo then they can STILL be traded for profits. In fact, the markets are probally becoming more precise, and they have more liquidity, as more and more emotion is being removed from trading and more firms are going to Hft. Look..the hft and algos are not that interested in you and I. They are battling each other. We are peanuts to them. We are potatoe chip money to them. They are trying to take profits from each other.
Is daytrading still alive? Of course it is! Maybe even more alive. It may take some adjustment to ones personal strategies and tactics that one had used previousley in the markets but it is not dead. For instance, i used to daytrade stocks just for 1/4 or 3/4 back in the day when they were quoted that way. I did this off the top of the book ..just the bid and ask price and vol and watching what the specialist and Market makers were doing. I don't do that any more and don't try too. To me that area of trading has been affected by Hft ...etc
Discretionary trading is still alive and well. In overall terms, no computer has the power of the human mind and brain. It may best the brain and body at the nano second level because of the physical limitations of the body to act and react fast enough but 5 minutes out...no way..the brain is much more powerful. Nevertheless, it does take proper knowledge in the brain as it has to have reference points to work off from. My opinion. I could be wrong. I have been before.
