A sparse multi-year journal towards profitable automated trading systems
In this journal I'll document my progress towards creating profitable automated trading systems. This is going to be a wild ride as there's a lot of work to do and I have a lot yet to learn, therefore this journal is likely to: last a few years, follow me across countries, survive through personality changes, and witness long periods of my complete withdrawal from it and the goal; I'll most definitely switch periodically to my other projects in search for quicker ways towards a grander goal which stays veiled for now. With this journal others will be able to get much needed new input to their brains, new ideas, while I am able to practice careful thinking and have a little fun laying out some of my work.
I currently have no experience trading. 4 years ago I committed to trading the currency markets and the first thing I've done is to learn programming, properly. You will see in this journal why I believe the brain is not adequate for intraday currency trading without some serious heavy-duty tools, and with them there's not much left for the brain to do so it's best to automate everything. The learning stage is still on: now in the math, logic, reason, and computing section. I need to learn these topics properly before I grind on creating automated trading systems (luckily, my other projects will also benefit from this knowledge). Expertise is not the same thing as experience, I can not just start creating automated trading systems or I get stuck in a local maxima just like many on here. It is fully necessary to think before you do, and achieve expertise before you see. Education is what enables you to set forward the necessary steps towards achieving your goals.
Errors and inaccuracies will not be corrected when caught unless they reduce the reader's experience. I'm applying new knowledge, it can be expected that I produce some errors. Also expect my writing style to be horrid for a long time as I do not have time to study writing. Now we begin. I'll start the journal with a thought exercise, the fruit fly:
I've never made friends with a fruit fly.
The fruit fly, it doesn't acknowledge me. It doesn't see me. I don't exist to it. But why? A fruit fly computes, doesn't it? A fruit fly sees, doesn't it? A fruit fly thinks, doesn't it? A fruit fly interacts, doesn't it? So why do I not exist to it?
A fruit fly landed on my leg: "AHA! There's my fruit fly, I knew you'd be my friend. Hello? Hmm I wonder why it's not acknowledging me."
I put food on my leg: "AHA! There's my fruit fly, back again. Maybe now you'll acknowledge me, I've given you food and everything!"
Impatient I became: "What is it with you fruit fly! You can interact with my leg. You can acknowledge my food. But me, the very character that's giving you the time of your life, the safest place you've ever seen, all the food you'd ever need, you can't even acknowledge!"
And that's the thing with fruit flies. They may have eyes like you, they may sense heat like you, but you as a person simply are a pattern too subtle, too hard to notice and handle. There's two reasons for that. One, the eyes of the fruit fly receive much less light than we are accustomed to. The fly is only going to notice patterns, structure, across way less light. Not many patterns exist there. Reason two, even if the fly did receive enough light, you are simply a constellation to them. You don't matter. You're hard to see. You're just some abstract pattern in a sea of light that has nothing to do with the constellation that is you. Or so they think!
"But I matter! I can crush this fly at any time I want." Exactly. The flies may currently be successful, many, and seem to go on with life just fine without noticing us. But if they did notice us, their accuracy in matching input such as light with optimal output such as movement would go through the roof. They could live like kings, following us humans around like the food and shelter producers we are, while being careful not to get too close. A subtle far out constellation and complete waste of time? Hah, not anymore! Oftentimes the most subtle patterns for you today may be your richest patterns tomorrow.
This is going to be a sparse journal. I am working on many things including my own programming language and libraries which strictly precedes the main part of this project and others.