High frequency trading (HFT) continues to grow across the globe, particularly in Europe, due in large part to the fact that the technology required to start an HFT operation is getting cheaper and cheaper.
Many traders are setting up their own high frequency trading shops, backed either by the money they have made in bonuses from investment banks or by private equity. They can do this because, according to the High Frequency Trading Review, it is now 80% cheaper to set up a new HFT operation than it was just five years ago, when the practice first came about.
In fact, it’s [...]
From the category archives:
General Market Banter
If you’re short Amazon (AMZN), raise your hand and Tommy will come over and hit you on the head with a tack hammer.
There was no end to the stream of people getting killed trying to short this stock. I’ll admit, this was one of the stocks that I talked about day trading yesterday. I tried to short it Friday morning after earnings and a huge gap up, but I quickly turned it around for a 3 point gain. There was no way I was touching a short today.
There is NO reason to be short this stock right now. It is in uncharted territory [...]
Day Trading Mistakes Happen. Get Over Them and Move On
Have you ever seen the movie Groundhog Day? It stars Bill Murray as a disgruntled weatherman who’s pissed about his assignment to cover the events surrounding Groundhog Day in Punxsutawney. Due to a blizzard after the events he is forced to spend the night in this town that he loathes. He wakes up the next morning to find himself reliving Groundhog Day again. This happens repeatedly until he straightens his priorities and gets his co-star (Andie MacDowell) into bed.
Groundhog Day came in October for Me
Bill Murray spends the first few days [...]
An alliterative title and a simple message; trade the trend.
Sam of Tradersam’s Blog wrote a this post today about a website called Wordle. This program takes any block of text, including that from a website, and converts it into a word cloud. This allows you to visualize what the site might be about.
Trade the Trend
I decided to check it out for myself using ChartShark.com, and look what the largest two words are; “Trade” & “Trend.” Apparently, subconsciously, I’ve been really hammering this point. Trade the trend, the trend is your friend, don’t fight the trend. You can say it a million ways [...]
The market doesn’t care if you’re a bear or a bull. It doesn’t care if you think it’s oversold or undervalued. It doesn’t care about your fundamental analysis or your charting skills. The market will do what the market will do, with or without you. You are not in control.
Accept It
One of the worst things you can do is a trader is to start to feel like you’ve lost control of the market. You should never feel that way because you never had control in the first place. You can have all the indicators in the world telling you to [...]
I wrote here that I would provide a replay of the StockTwits and Data Junkies Closing Bell Ceremony. Well, here’s a quick overview of my time in NYC, the NASDAQ Closing Bell Ceremony, and the after party.
Getting There
As mentioned in my previous post, I took this crazy midnight bus to Chinatown. The trip there was rather uneventful, until the sun came up and I couldn’t sleep anymore. This is when I noticed that the driver was driving a busload of people through busy traffic as if he was rolling in a souped up Honda Civic. He was blasting past cars [...]
In just a few hours I will be boarding a crowded bus in the middle of the night for the 6 hour trip to NYC.
I am Going to NYC Because I am a Winner
Stocktwits and Data Junkies had a contest with 1 prize for 30 people. That prize was to join Stocktwits & Data Junkies in Times Square for the NASDAQ Closing Bell Ceremony. I ended up winning one of these spots, and I am headed out of here in t-minus 3 hours (I should probably start packing).
I am Taking a Bus for 3 Reasons
I’m a cheap bastard – If I [...]
What happens when you combine day trading zombies, explosions, and automatic weapons? You get Daytraders of the Dead. This game is part Smash TV, part Dead Rising and all awesome. The concept is very simple – zombies come and you shoot them. More zombies come, and you shoot them too, and so on. There is a “story mode” as well as “survival mode.” The only real difference being that the story mode has levels, while the survival mode is a constant wave of ever increasing quantities of zombies. There are also a handful of weapons to aid in your [...]
I was born in the year of Pac-Man. As a matter of fact, I think it’s no coincidence that it debuted a week after my birth. They knew I was coming. And as far back as I can remember remembering, a large portion of my life has been dedicated to gaming. In those 30 years of gaming I believe I’ve picked up some skills that are useful when day trading.
Gamer’s Trigger Finger
When it comes time to pull the trigger, we gamers do so without hesitation. We are no stranger to watching a screen all day and having to point and shoot at exactly the right moment. We expect accurate [...]
In a previous post I talked about the alignment of moving averages on the SPY. I color-coded the moving averages according the colors of the rainbow for visual clarity and order. MA (5) = Red MA (10) = Orange MA (14) = Yellow MA (20) = Green MA (50) = Blue MA (100) = Indigo MA (200) = Violet
Rainbow Moving Average Update
When we took a look at these moving averages back then, the alignment was R(V)OY-G-BI. The violet (MA 200) was the only moving average that was out of order. Well, today this still remains the case. We have [...]
As normal trading hours wound down today, I mentioned on Twitter via Stocktwits, that the current candle formation on the SPY daily chart is an ominous sign for the bulls.
The Shooting Star
The shooting star is one of the more basic candlestick formations. It is the final candlestick in the chart above. What characterizes the shooting star is its gap up at the top of an uptrend (known as star position) combined with its upward pointing wick, and small body. It tends to signal the potential for a bearish reversal, and the fact that the body itself is red makes the [...]
Today was just one of those days. No matter how hard I tried I could not focus on my day trading. I didn’t get my system up until after 10, and didn’t have the time to scan the news for anything new for my watch list, or get a feel for the markets. I then made a series of trades that completely flopped. My lack of focus was so bad that I completely missed the Yahoo (YHOO) news and subsequent gap down into what looks to be some nice shorting opportunities. I tried to make an effort to regain [...]
As my hometown wrapped up Gay Pride Week with a delightfully flamboyant parade, I wondered how I might use the powerful symbol, the rainbow, to represent the goings on within the stock market.
I mostly use the SPY as my general market indicator, so I pulled up a daily chart and employed some tricky technical analysis. It was then that I noticed an interesting phenomenon…
I lined up popular MAs according to ROY-G-BIV from fast to slow
MA (5) = Red
MA (10) = Orange
MA (14) = Yellow
MA (20) = Green
MA (50) = Blue
MA (100) = Indigo
MA (200) = Violet
As you can see we’re [...]
When they talk about “making money whether the stock market is going up or down,” this is the type of down day they’re talking about. I guess it’s unfortunate that this signals some weakness in the stock market (at least short-term), but we might as well profit off of the stock market’s failure.
When my stock charts showed the huge gap down from Fridays close, it became fairly obvious which way the stock market was headed. The fact that the market didn’t even attempt to close the gap confirmed it. We were headed down. I figured at the very least we’d [...]
