The squeeze in oil is nothing short of amazing, it feels good to recover lost coin in my oil position, especially at the rate of change today. Option Addict touched on the pain trade quite a bunch over this past weekend’s conference, and it continues to play out in real time.
Get everyone leaning one way, then this happens:
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Congrats to the oil longs that had the fortitude to hold.
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fake a move to make a move is the way things work lately
indeud. Have seen it work time and time again. Props to OA for shedding so much light on the subject.
Seconded. At the conference (and IIRC from his AHWOA work), one of the more interesting takeaways from his talk that the ‘bots are better at recognizing what humans will do in response to certain patterns, and will position themselves accordingly to exploit the actions of the remaining humans who still trade by Edwards and McGee.
To amplify on that point – the old game 20 years ago was figuring out which funds/institutions were buying based on from which brokers a block trade originated.
The current equivalent, presumably, is to use knowledge of which institutions and exchanges are associated with retail order flow, and if you have a feed that contains the state of the order flow at every millisecond, you can probably do some really neat analysis on that on the back-end.
Consider two 1000-share volume bars on a 1-minute bar chart: One is two bots tossing 100 shares back and forth at each other five times over. Another is a 1000-share market order that came through from some aggregator of retail order flow. They look the same on the bar chart, but they don’t look the same on the order book, and they mean something completely different.
You’re in GPRO aren’t you RC?
No GPRO for me.
call the bottom in natty gas cuz it looks like its goin to zero…thats GOT to be the next huge pain trade
got to be close.
Go $USO, been long. Sketchy down there in the high 13s.