Friday, March 26, 2010

A New Era for Trading

We have entered a new era. High-frequency trading, rebate-trading, alog predatory trading, and program trading have changed the rules. I recently read an article by Sal Arnuk and Joseph Saluzzi- two relative unknowns my computer found through our Internet recon programs-which describe a potential threat to our trading strategies. There is no real proof of their claims;however, we have been discussing how strange the markets have been acting for a long time now. I can send you the article upon request. A quick glance of job openings at hedge funds and institutions indicate a huge demand for these types of traders and professionals who can design these programs. Basically, in the new era-volume and volatility can be manipulated for rebates and not actually indicative of a trend. This changes technical analysis and trading strategies.The popularity of TA now makes it very easy to send false signals using these programs. We will continue to work on new programs to make money in these ever changing environments; however, the regulators are playing a dangerous game of favoritism that may threaten the very spirit of free markets and capitalism. WallStreetRamblings will continue to find new (maybe old) and innovative ways to take advantage of the markets for profit.