mate I'm not arguing, the infos appreciated & makes a lot of sense
my point is that a move like that is not a fair & orderly market. maybe you're right maybe we just have to live with it - I'd like to think we didn't have to tho
International Index Trading
- Thread starter wayneL
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mate I'm not arguing, the infos appreciated & makes a lot of sense
my point is that a move like that is not a fair & orderly market. maybe you're right maybe we just have to live with it - I'd like to think we didn't have to tho
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What do you mean by thin liquidity Sinner? Volumes on futs were heavy accross the board.......(from FX, commods, equities and bonds)........
When an error like this happens, you get the initial bids taken out, then the book is thin as hell as nobody loads back any volume down the bid, once it is filled, bots come in and buy it up quickly. I've got a live video (which I don't think I can post due to copyright or something of the like) of the price ladder when a similar situation occured on the SPI a year and a half ago. This was a buy stop at market though, looks incredible. Hundred lots trying to get fills and gapping 20-30 points to hit the nxt 2 lot before going on again to find any volume. At some point, a bot comes on and takes as many fills as it gets before going to town the other way.
Not saying it's the reason for the entire market down move (as I was short also for many other reasons), but I personally believe it for quick moves like this which would show low liquidity and high volatility for that short period.......
When an error like this happens, you get the initial bids taken out, then the book is thin as hell as nobody loads back any volume down the bid, once it is filled, bots come in and buy it up quickly. I've got a live video (which I don't think I can post due to copyright or something of the like) of the price ladder when a similar situation occured on the SPI a year and a half ago. This was a buy stop at market though, looks incredible. Hundred lots trying to get fills and gapping 20-30 points to hit the nxt 2 lot before going on again to find any volume. At some point, a bot comes on and takes as many fills as it gets before going to town the other way.
Not saying it's the reason for the entire market down move (as I was short also for many other reasons), but I personally believe it for quick moves like this which would show low liquidity and high volatility for that short period.......
To quote ZH again - sorry but this guy took the words right out of my mouth:
http://www.zerohedge.com/article/dissecting-crash
Clicky to read on.
The chart in question is the 1 second NYSE $TICK histo.
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Yes, but previously you stated that after the DOW crash (which if the 'fat finger' is correct, was actually an e-mini S&P crash) which would have put bots onto the initial bids and hence wiped out the front of the book and then easily made it's way through the back in the other US futs contracts, which would then have done the same on the JPY, as bots hit the ask on the 'risk off hedge'. If the rest of the liquidity was pulled as a safe measure on other crosses etc, that is understandable. Models would have gone out the window.
But volumes were still extremelly high accross the board, sharp moves though will always be lacking liquidity as the book bar the front orders is always thin so sweeps at market will always take out way too many price levels.
You say there is a banking funding crisis, you can see EUR libor - ois spreads rising along with the US equivelent, so that makes sense. Fed may place swap lines to ECB to regain liquidity and keep down libor as early as tonight, which would probably see a risk rally.
But volumes were still extremelly high accross the board, sharp moves though will always be lacking liquidity as the book bar the front orders is always thin so sweeps at market will always take out way too many price levels.
You say there is a banking funding crisis, you can see EUR libor - ois spreads rising along with the US equivelent, so that makes sense. Fed may place swap lines to ECB to regain liquidity and keep down libor as early as tonight, which would probably see a risk rally.
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Yeh, luckily I got out towards the lows on a lot of the moves, but still lost a bit of open profit (hey, can never pick the exact low)!
Only playing spreads now, so not as much $$$ in them but really unsure on the whole 'risk-on', 'risk-off' scenario at the moment.......
Big Q is how much influence does China (bad figures today, tightening coming soon rather than later by the looks), have on the rest of the world?
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Crazy days alright. Happy days if your on the right side of the market movement.
It was amazing to see the QQQQ and the SPY drop so much in the space of about 12 mins.
With the Volatility Index (VIX) displaying such extremes last week, playing spreads may be a smart bet, to take some leverage out of the equation.
It will be interesting to see if the VIX settles down over the next week or so, or continues to spike. Either way trading may be a bit volatile over the short term
I'm expecting today's gap open to be filled in the next few days, but we will wait and see.
It was amazing to see the QQQQ and the SPY drop so much in the space of about 12 mins.
With the Volatility Index (VIX) displaying such extremes last week, playing spreads may be a smart bet, to take some leverage out of the equation.
It will be interesting to see if the VIX settles down over the next week or so, or continues to spike. Either way trading may be a bit volatile over the short term
I'm expecting today's gap open to be filled in the next few days, but we will wait and see.
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Well thats a nice move for copper...
Good morning BHP tomorrow will be interesting
Good morning BHP tomorrow will be interesting
oops meant to say there's a large gap to fill, not a large big - must learn to typo with more than 1 finger
Just read Martin Armstrong convinced '08 was the low and we will see new highs after the Dow tests 9600. I know Nick Radge dislikes him, but for some reason that makes me all the more interested in his predictions.
He also makes an interesting slate on UST bonds, but I will leave that up to the enquiring minds (hint: he has already been half right on this call and we might see him right on the other half if LIBOR >75bps triggering a rout in US 2y)
I am not convinced either way and my trading timeframe is too short to care from a trading perspective - but thought it worth posting for posterity here.
We can come back and deride or applaud as appropriate once we reach the event horizon.
PS: for an equivalent Dow:Gold ratio bottom at ~2.0 we would be looking for roughly 5000USD/oz to meet the 9600 number at 1.92 ratio. I am not writing this number as a prediction, just a back of the napkin calculation for those interested.
He also makes an interesting slate on UST bonds, but I will leave that up to the enquiring minds (hint: he has already been half right on this call and we might see him right on the other half if LIBOR >75bps triggering a rout in US 2y)
I am not convinced either way and my trading timeframe is too short to care from a trading perspective - but thought it worth posting for posterity here.
We can come back and deride or applaud as appropriate once we reach the event horizon.
PS: for an equivalent Dow:Gold ratio bottom at ~2.0 we would be looking for roughly 5000USD/oz to meet the 9600 number at 1.92 ratio. I am not writing this number as a prediction, just a back of the napkin calculation for those interested.
Hi guys,
Here is my DAX analysis. It was formulated using a different method, but I "translated" it into S/R and round numbers so as to avoid any controversy regarding technique. I know TH doesn't like MT4 for charting, but perhaps a lack of fence sitting will make up for that.
R: 6050
S: 5950
Anticipating a failure to close above S on the daily in the next five trading days. What will follow is the three targets (blue dotted), 5475, 5180 and eventually 4700.
Trading signal would be daily close below S, action to short the DAX cash or futs with a stop above the failure high. Positions to be added at the first two blue lines on the way down, take profit at 4700.
Just to stir the pot a little, I'll take 6008 as the failure high "cowboy call".
Here is my DAX analysis. It was formulated using a different method, but I "translated" it into S/R and round numbers so as to avoid any controversy regarding technique. I know TH doesn't like MT4 for charting, but perhaps a lack of fence sitting will make up for that.
R: 6050
S: 5950
Anticipating a failure to close above S on the daily in the next five trading days. What will follow is the three targets (blue dotted), 5475, 5180 and eventually 4700.
Trading signal would be daily close below S, action to short the DAX cash or futs with a stop above the failure high. Positions to be added at the first two blue lines on the way down, take profit at 4700.
Just to stir the pot a little, I'll take 6008 as the failure high "cowboy call".
Attachments
Just me in here, is it?
Failure high has resulted in close below S on the daily as expected. My trade parameters are as per above. Please do not follow this trade or read it as any sort of recommendation. This analysis and trade sequence only posted for the benefit and discussion of other traders.
Failure high has resulted in close below S on the daily as expected. My trade parameters are as per above. Please do not follow this trade or read it as any sort of recommendation. This analysis and trade sequence only posted for the benefit and discussion of other traders.
Attachments
Sinner, your chart was too dark to read yesterday, and its hard to discuss a method when all you mention was 'using a different method'.
But as for being bearish, I think we all agree, you'll have trouble finding a bull in here. Not while the euro is being continuously sold into every squeeze.
More wiggling around to come but oil and euro still leading the entire show.
But as for being bearish, I think we all agree, you'll have trouble finding a bull in here. Not while the euro is being continuously sold into every squeeze.
More wiggling around to come but oil and euro still leading the entire show.
Sorry mate. I did not realise the chart was too dark. My guess is those MT4 bars are just too thin to view properly at that zoom level! I'll stick to the PRT EOD charts for posting here.
I didn't wish to cause any controversy over the analysis method so I converted the trade sequence into a simple support/resistance trading plan. People should be able to discuss/agree/disagree on a parametrized sequence regardless of their opinions on any one "method".
As for your last two statements, I am inclined to disagree. I believe there will shortly be a decoupling between equities and forex and oil. Certainly the traditional correlations between EURUSD and ES during NY market hours have been long broken with EURJPY correlation now occurring during low vol periods. I already spent the first half of this year selling GBPUSD and buying FTSE calls to good effect - so am less interested in the correlated markets idea for any useful trading purpose.
Well, my trade was stopped cold last night. During the hour I thought breakdown would occur we rallied back above 5950 and this was a sign something was up. Woke up to find myself stopped.
Unsure where we go from here (but bias is up now), will watch how the price reacts to 6050.
Unsure where we go from here (but bias is up now), will watch how the price reacts to 6050.
