Tuesday, August 14, 2012

More on the predictability of traders...

I'm not posting this as an interesting aside, I'm posting it so you can see how predictable traders are and given some simple Book information on where stops that are left with brokers or orders that are left with brokers, it makes the game like shooting fish in a barrel for Wall Street or anyone else who has made some modest discoveries by paying attention.

My hope is that you will be able to use this in your analysis and understanding of the market.

That same 50 bar, 5 min moving average in AAPL used since the 1990's when everyone was a day trader. Wall Street can easily use this to set traders' expectations who follow this ma, and can use it to suck them in or knock them out of positions, it's not hard at all for a market maker to move the market a little intraday working the bid/ask and either pulling in or letting out some of their inventory. In fact I wouldn't be surprised if some algos/HFTs programs used this very predictable "Tool" (sarc.) to trade.

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