Tell me how Tech Analysis was supposed to forecast this flash-crash?
- Thread starter crgarcia
- Start date
Quote from deadbroke:
You made up your mind regardless what anyone says.
The reversal on April 26 was not too hard to call. After a reversal shit happens. Flash crash or fck crash, whatever.
Funny how anyone can post after-the-fact calls.
They reply because they know I'm just telling the truth, and truth hurts.
I made 50% on my account May. 6th. I had 95 strike TLT Jan 2011 Calls in my account, and had bought them April 5th.
The truth is the bond Market rallied at around 9:30 that day (30 yr treasury) and I was at work, so I didn't participate directly. My long-term option position in treasuries sold off quite a bit, but I sold it August 24th when TLT hit 107.
My point relating to the flash crash is that a few critical things were in confluence. - The Europeans were in a stealth bailout of Greece around that time (whereby the Money was actually going to hold up France) and bonds were in a massive short covering and change in perception by some of the smarter folks, who began to detect weakness in the economy and were starting to sell equities.
The macro issues aside, no one should believe that the Market is held up by it's own momentum since May 6th. Its clearly out of line with what the bond Market has been telling us since April.
The truth is the bond Market rallied at around 9:30 that day (30 yr treasury) and I was at work, so I didn't participate directly. My long-term option position in treasuries sold off quite a bit, but I sold it August 24th when TLT hit 107.
My point relating to the flash crash is that a few critical things were in confluence. - The Europeans were in a stealth bailout of Greece around that time (whereby the Money was actually going to hold up France) and bonds were in a massive short covering and change in perception by some of the smarter folks, who began to detect weakness in the economy and were starting to sell equities.
The macro issues aside, no one should believe that the Market is held up by it's own momentum since May 6th. Its clearly out of line with what the bond Market has been telling us since April.
What exactly do you mean by technical analysis? That could encompass alot of methods. If your talking about stochs and MACD's - yeah throw that crap away.
However price action clearly shows you wanted to be short into and thru the U.S. session. The fundamentals also were bearish.
I've been following alot of commentary today about the flash crash. It appears that the HFT's were looking for ideal conditions to short. As a trader you should be looking for the same conditions.
I was shorting the euro that day and did well.
However price action clearly shows you wanted to be short into and thru the U.S. session. The fundamentals also were bearish.
I've been following alot of commentary today about the flash crash. It appears that the HFT's were looking for ideal conditions to short. As a trader you should be looking for the same conditions.
I was shorting the euro that day and did well.
people were looking for a failure in februari of 2010 2 months.. and got their ass handed to them.
You can't prove technical analysis is worth something... you're just a permabear and got lucky.
businessstaxes
Guest
human nature is predictable market was at resistance market was going to crash or correct but it just did it in a day rather than 2 months of slow grind down...The HFT machines started to frontrunning client sell orders with market sell orders and voila...==crash...
with this market,everytime a client puts a limit sell order a HFT goes in front of the client order. then the seller has to sell it lower or hit teh bid to fill his order. same with clients putting a buy order these HFT immiediate frontruns them. and it's automated and obvious...these HFT programs are at the exchange. hedge funds pay big bucks to have a seat on the co-location HFT servers.
normally it would slowly grind down..but no the HFT started hit the bids with market orders in the S&P futures which are the market now. all stocks follow the ES futures now. in stocks you cannot sell when price is falling with the uptick rule which slows down the price fall.. you combine shorting and stop loss orders you get a crash.
with this market,everytime a client puts a limit sell order a HFT goes in front of the client order. then the seller has to sell it lower or hit teh bid to fill his order. same with clients putting a buy order these HFT immiediate frontruns them. and it's automated and obvious...these HFT programs are at the exchange. hedge funds pay big bucks to have a seat on the co-location HFT servers.
normally it would slowly grind down..but no the HFT started hit the bids with market orders in the S&P futures which are the market now. all stocks follow the ES futures now. in stocks you cannot sell when price is falling with the uptick rule which slows down the price fall.. you combine shorting and stop loss orders you get a crash.
I'm not too convinced YOU trade garcia.
Then again, maybe you filled a few in between those 3500 posts, but you don't make a living from the river of fish.
To answer the thread's question, using SPY as a proxy, it hit two consectiive 20 day lows on 5/4 & 5/5. 10 day low is a warning, 20 day low (which approximates a month) calls for action. Either cash, getting smaller, or establishing shorts. The latter is an artform.
Additionally, the 34 day rate of change, a nice smooth curve that approximates a month and a half, pierced zero on 5/5 after being positive since March. In essence, the rally was over.
SPY's price also moved 2.5 ATR (a half week) away from the highest value on 5/5. a/k/a a Chandalier stop.
Related, the NYSE advance/decline line made 10 day lows on both 5/4 and 5/5. A warning.
New 52 week highs had dropped off materially after 5/3. In essence, new virgin territory had narrowed.
Then of course, there's the time-tested adage to "sell in May and go away".
I wish YOU'D go away, but that's wishful thinkin' , isn't it?
The Lehman "crash" of 11/08 was far MORE scathing. And...........it couldn't be predicted by outside observers.