About Our Trading System, its application and how to make money from it!
In broad terms, trading falls into one of two camps: systematic or discretionary.
The discretionary approach welcomes personal judgement in individual trading decisions.
Alternatively, a systematic approach involves conceptualizing, defining, writing and testing rules for entering and exiting trades, then consistently trading by those rules going forward.
Discretionary traders argue that past data were moulded by unique micro- and macroeconomic forces and rigid rules based on that data ignore the fluidity of the markets. Systematic traders counter that, with care, even new traders can write rules that are robust enough to accommodate unseen market scenarios.
One of the strongest arguments for systematic trading, however, has to do with the trader, not the system — more precisely, the trader’s emotions; we are all Human by design, we have good moments and low moments, you argue with your loved ones, a work colleague, your late for work, someone hits your new Porsche ! We all have good and bad days! Having a bad day? Don’t Trade on your wit, believe me it will get worse !
Our buy or sell signals from our trading system follows the set of rules that is independent of the varying discretion and emotion of the trader.
Traders, particularly new traders who lack the experience of market moves and reactions, generally perform poorly when emotions come into play.
Our system is simple ; follow the arrows and be prepared to follow the arrows for a few minutes, hours or hopefully days if necessary, if you miss an entrance arrow wait for a Fibonacci or a pivot level for that pair and hop on.
Remember this is a system that requires you to execute the trade and therefore you are in control of the money management side, don’t be a fool, risk only small amounts, some traders like to have an exposure that doesn’t exceed 2-3% of capital! Build some profit before you begin to run with this!
About Black Box Trading
What real roles do computers play in trading today?
What role did computers play in the recent shifts in the markets and individual shares that have been victim of the over exaggerated reaction of poor or bad news and with the calendar nearing the one-year anniversary of the collapse of Lehman Brothers, Northern Rock, a question lingers: Did the black boxes bring about there fall?
To many, it’s still unclear if Lehman’s, like so many others mortal wounds were self-inflicted or if its death was hastened by a thousand trades.
There are few companies outside the main investment banks that really invest in quantitative or high-frequency trading. The media have built a hype and misunderstanding of the quantitative world, they think its computers that manipulate markets, when really its people who do.
To be clear quantitative trading and its sub genre, high-frequency trading, are good for the markets. Such trading strategies create liquidity in the markets and — in the case of high-frequency guys this can stabilize volatility by providing the other side of the trade. They buy when there is a preponderance of sellers. They sell when buyers are dominant.
High-frequency traders took the wrong side of trades as bank stocks were tumbling around the time Lehman Brothers was failing. That’s the opposite of what many believed was quantitative profiteering on Lehman and other big banks a year ago.
The problem, of course, is that people have been given new, trading tools of mass destruction. In the right hands, a high-frequency or passive quantitative program can be left running with minimal human interference. There’s balance and liquidity in the markets, and the traders make a tidy profit.
Put those powerful tools in the hands of the less scrupulous, however, and suddenly the rules have changed. Someone is not only playing the game but controlling the roll of the dice.
A federal prosecutor asked a judge to put Sergey Aleynikov in jail because the computer code he allegedly stole from Goldman Sachs Group Inc. could be used to “unfairly manipulate” stock prices.
If someone could really do it with a few megabytes of coding, what’s to stop traders at a big brokerages or a big hedge fund or anyone with real resources from hitting the trading desk even if for only a few trades? Market manipulation is a crime as old as the markets themselves, but have the markets ever seen such a powerful force as a computer that can crunch numbers — including volumes in a hundredth of a second?
Computers in our lives are here to stay, they wont be governed, they cant be stopped we can only hope that we can enhance them and manipulate them rather than they manipulate us!
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