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Real or Algo

  • #861
  • Edited 7:43am Mar 4, 2021 7:18am | Edited 7:43am
Quoting GEfx
{quote} I did see this, but I thought you were kidding. But you repeated it. So you must believe it. It makes no sense, but then again, nothing that has been said about the single controlling algo has made any sense. Let me get this straight: you've detected an error in the algo, whereby large banks can drop funds on the opposite side of their order book (opposite side of the order book, meaning what?) (and without this programming error, the banks would have to do what exactly to drop funds there?)(and the banks benefit from this activity how exactly?...
Its my best guess, but yes.
I can't see another reason why large orders turn the market so easily. It only takes 10 minutes of average daily volume to turn a market, pull backs takes 3 minutes worth of average volume. That major low on GBPUSD a few hours back only took 11 minutes worth of average volume. That's Fuck all.

I don't think you see the market as I do, a market starved of liquidity that's easily turned by using only moderate volume to create an inbalance on the order books. This inbalance or the amount needed to turn the market is well known by the major players. Even I know which is surprising because I don't claim to be the cleverest dick on these forums.
Trading thin liquidity at the boundary of the charts
  • #862
  • Mar 4, 2021 7:59am Mar 4, 2021 7:59am
Quoting RickM
{quote} Its my best guess, but yes. I can't see another reason why large orders turn the market so easily. It only takes 10 minutes of average daily volume to turn a market, pull backs takes 3 minutes worth of average volume. That major low on GBPUSD a few hours back only took 11 minutes worth of average volume. That's Fuck all. I don't think you see the market as I do, a market starved of liquidity that's easily turned by using only moderate volume to create an inbalance on the order books. This inbalance or the amount needed to turn the market...
Hi RickM, Look, I'm not trying to be a dick -- well, maybe I did at first, but not now. I'm just trying to understand what you are saying. You didn't explain anything about how this error in coding thing is exploited. I understand how bank trading operations work, so what you are saying just makes no sense. The observations you are making about volume also make no sense, since there is no indication -- zero -- on my charts that there is a liquidity problem or that the market is starved of liquidity. The volume needed to turn the market, or making a qualitative opinion about it, is less important to me that understanding why they want to make the turn and the strategies needed to keep it moving once the turn is made. Look, banks will collectively use whatever resources are needed to operationalize strategy, the less resources the better, so if it takes small volume to turn it, that's ok with me. And btw, I don't see a major low on the G$, so not sure what you meant by that.

Lastly, the current narrative in the fx markets, and in fact, all markets, is being controlled by the Feds lack of direction on SLR. If you viewing the fx markets from the narrow perspective of volume, then everyone should understand that volume is sitting on the sidelines until Powell speaks in a few hours. RickM, good trading and I hope I haven't totally pissed you off. I have been hoping for clarity not trying to pick a fight. I now have a headache.
  • #863
  • Edited 8:47am Mar 4, 2021 8:34am | Edited 8:47am
Hi guys,

Just thought of sharing a video here of how banks v banks in FX looks like in the 80s before the computer came to about. Heck, i'm not even born yet during that time haha .

Not sure if relevant, but I thought it'll be a nice video to share for those who have not seen it. do have a look

Inserted Video


Keep up the momentum of the discussion with positivity guys!

Cheers
Zyzel
Always Learning. I am no Master
  • #864
  • Mar 4, 2021 9:12am Mar 4, 2021 9:12am
Quoting Zyzel
Hi guys, Just thought of sharing a video here of how banks v banks in FX looks like in the 80s before the computer came to about. Heck, i'm not even born yet during that time haha . Not sure if relevant, but I thought it'll be a nice video to share for those who have not seen it. do have a look https://www.youtube.com/watch?v=A6vq...7mSS4&index=39 Keep up the momentum of the discussion with positivity guys! Cheers Zyzel
If you watch the context of this video you find that the interbank forex market is not there merely to facilitate the daily commercial demand and supply purpose. That part of the banking operation is a small part of the interbank forex market. The main segment of this market is a gigantic casino where thousands of bank traders gamble the allocated bank funds in directional speculation to make the required returns for the allocated funds. Bank traders that lose money get the sack. Those that meet target get more allocation and if they lose money they get the sack. If they don't meet targets they are earmarked for the sack. The chief strategist main job is to find new blood scapegoats fresh from the university armed with Masters degree and PhDs to be put through the grind. These chief strategists need scapegoats to account for the poor performance to the trading department GM or director. That's how it works in the banks forex department.

Another thing to note is a high percentage of the execution is done by algos. There's only a few prop traders who manually execute trades. This segment is bound for extinction. And there's always a compliance department algo that run real time in the back-office operation.
Know what you trade
  • #865
  • Mar 4, 2021 9:51am Mar 4, 2021 9:51am
Quoting BWilliam
{quote} The chief strategist main job is to find new blood scapegoats fresh from the university armed with Masters degree and PhDs to be put through the grind. These chief strategists need scapegoats to account for the poor performance to the trading department GM or director. That's how it works in the banks forex department.
THANKS BW for the extra layering of info! Yes, that would make sense, coming from a director's or GM's psychology/nature.

Quoting BWilliam
{quote} Another thing to note is a high percentage of the execution is done by algos. There's only a few prop traders who manually execute trades. This segment is bound for extinction. And there's always a compliance department algo that run real time in the back-office operation.
Just for my own clarity - to make sure I understood you correctly - human/manual traders are getting lesser and lesser by the day in all these banks ? So now, as of this time, it would be the battle between banks and banks employing their respective algos? If so, it will imply that there's no more manual traders in the foreseeable future? Man that's sad. For both retail traders and human institutional traders - with one fighting algos, and another losing their job as a human institutional trader

Cheers
Zyzel
Always Learning. I am no Master
  • #866
  • Mar 4, 2021 10:16am Mar 4, 2021 10:16am
Attached Image

Where is the Algo located in this map ? Is it the in the EBS ?
It never gets easier, you just get better
  • #867
  • Mar 4, 2021 10:50am Mar 4, 2021 10:50am
Quoting Shabs19
{image} Where is the Algo located in this map ? Is it the in the EBS ?
Algos are used at all levels of the map, to test and confirm when specific conditions are met, for the smooth operations of the market. The single, all-controlling, error-ridden algo does not exist. Anyone who says it does, has no proof and is engaged in conspiracy speculation.
  • #868
  • Mar 4, 2021 12:17pm Mar 4, 2021 12:17pm
Quoting BWilliam
{quote} RickM, check your volume data.... What volume was transacted to drive the price up from day low in 1 hour? The algo code magically stop not beyond 1.40060. This number is important for this trading week. Market will either trade above or below it. If I were a swing trader I look to sell the rally tops.
Hi BWilliam,
After reading this post & the post you mentioned 1.4006 I starting paying attention to those levels & have managed to catch the moves away from & to those levels. I noticed almost to the pip price stalled & turned away from the 4006. Just closed a short on the GBP/USD just before it hit the 3930. Not sure about the Algo thing, but want argue the point as I'm not sourced with enough info to argue the point. There are many Youtube videos showing how to spot Algo pattterns on your chart, but i"m not sure if the info is that accurate. Would you share your views on what a trader should look for if we want to detect Algo patterns? Are there book sources for learning to spot these patterns? Your views, comments & suggestions would be appreciated.
  • #869
  • Mar 4, 2021 12:57pm Mar 4, 2021 12:57pm
Would be very interested to hear the algo levels on Spx and WTI today
  • #870
  • Edited 3:46pm Mar 4, 2021 3:22pm | Edited 3:46pm
Quoting BWilliam
{quote} RickM, check your volume data.... What volume was transacted to drive the price up from day low in 1 hour? The algo code magically stop not beyond 1.40060. This number is important for this trading week. Market will either trade above or below it. If I were a swing trader I look to sell the rally tops.
Hi BWilliams

Sorry, never got around to looking at those levels at 1.40060 but happy to flick over some numbers on todays London session.
However I had a look at last nights numbers with the move up just pass your figure at 1.40060.
The big money actually came in at 1.40080 to turn the market but there was a short impulse move just a bit higher up to 1.40183 close to last weeks Thursday High.
But without doubt, there was a big volume move to turn price about 2 pips higher than your call.

So great call.

I will say to me it wasn't the Algo turning price here but the bankers, they did need one more large volume dump to complete there mission.

Here is the important fact and I hope traders understand what I am about to say. They don't SELL and place a large Sell order on the chart, they dump very high Volume BUYS to destroy all nearby sellers.

Its Large Volume Buys that turn the market Bearish, its Large Volume Sells that turn the market Bullish
So they were all Buys at BWilliams level.

This is how they use the Algo's code against the market (in my opinion, its a coding fault that fails to account for low liquidity)

Cheers
Trading thin liquidity at the boundary of the charts
  • #871
  • Mar 4, 2021 4:01pm Mar 4, 2021 4:01pm
Quoting BWilliam
{quote} To me the bank and institutional traders are trading within the confines defined by the algo(retail traders are not in this picture). That's the narrative I understand. The why, how, what questions Idk the answer, I can't offer any explanation and I don't care to know. What I'm interested to know is not about the banks billion volume. I want to know the actual source, that's the math coded in the algo that paint the chart. EVERYONE talk in terms of a interbank FX auction market, that's what the official narrative that make logical sense....
Hi BWilliams

My opinion is you have a clever strategy that is able to understand targets that the Bankers are after, not the Algo's.
But who cares I suppose who you are seeing - as long as you are hitting trade after trade and making good profits.

I would do as George would do and not give too much away to those lazy traders.
Trading thin liquidity at the boundary of the charts
  • #872
  • Edited 6:14pm Mar 4, 2021 5:43pm | Edited 6:14pm
Quoting RickM
Hi BWilliams My opinion is you have a clever strategy that is able to understand targets that the Bankers are after, not the Algo's. But who cares I suppose who you are seeing - as long as you are hitting trade after trade and making good profits. I would do as George would do and not give too much away to those lazy traders.
RickM, you can see by now I knew about the top and bottom levels way before the real market executed any transaction that happened in the future. I also knew that the future market will eventually break the bottom level today.

So how is it possible that I knew all of that future market when the bank traders have yet to execute their transactions?

To me this is the work of the master algo that dictates the definition of the wholesale interbank market. The bank and institutional traders are only able to move price by small deviations outside this definition. That's why level2 volume data is only able to tell the banks and institutional transactions. But not the algo levels and valuation intent. I must admit I don't know all valuation intents but I know enough to make those calls.

RickM, I spent almost 8 years of research work to understand the math behind this master algo. I started with the basic sine wave and one thing led to another to the complete code eventually. I am able to calculate the algo levels for all assets including gold, oil, indices, commodities and BTC for all timeframes. Besides these levels is the more difficult part that is the live market valuation intent. This is the hardest part to define which means I know if the algo will break or fade a level. The most challenging is to know valuation intent of future market like this 1.40060 and 1.3930.

RickM, I know this post make a huge claim and the implications behind it. I have made plenty of such live calls on FF, you can check my history posts that's time stamped. This breakthrough quantitative technique has not come easy. 24/7 research work for 8 years. That's the cost and sacrifice. What if this research work ended empty handed, has anybody thought about that?

RickM, you mention to restrict information like George did. Whatever info I chose to post on FF is all that I am willing to divulge. The intention of my postings on FF is to address this master algo painting illusion on the charts. And not supply and demand economics in an auction market that its suppose to be. I believe my posts have shown just that. Based on this master algo narrative imagine the implications on the usefulness of traditional technical analysis.
Know what you trade
  • #873
  • Mar 4, 2021 5:53pm Mar 4, 2021 5:53pm
Quoting RickM
{quote} Hi BWilliams My opinion is you have a clever strategy that is able to understand targets that the Bankers are after, not the Algo's. But who cares I suppose who you are seeing - as long as you are hitting trade after trade and making good profits. I would do as George would do and not give too much away to those lazy traders.
RickM,

That suggestion may be a wee bit late for some free thinking outside of the box traders, but I am very sure you & BWilliam are sharing very little of your vast Algo, MM & Bank Trader knowledge. For me you & BWilliam & others on this thread have pulled my thinking outside of the box again. What you said about hitting the trade is what counts. There is more going on behind the curtian that is computer driven. If we can just do what Paul Tudor Jones said he does "Take Some Out Of The Middle" I'm good with that. Thank you for your contribution to those trying to enlighten themselves to the activity behind the curtain.
  • #874
  • Mar 4, 2021 6:46pm Mar 4, 2021 6:46pm
Quoting BWilliam
{quote} RickM, you can see by now I knew about the top and bottom levels way before the real market executed any transaction that happened in the future. I also knew that the future market will eventually break the bottom level today. So how is it possible that I knew all of that future market when the bank traders have yet to execute their transactions? To me this is the work of the master algo that dictates the definition of the wholesale interbank market. The bank and institutional traders are only able to move price by small deviations outside...

Not that I'm anymore enlighten now after having read this post, but thank you for your honesty. I have always felt there was always more going on behind the scene than the eye could see. I admire your continued drive & research until you crack the code. Could anyone else crack the could if they put in the efforts as you did, or has the code be strengthen making it impossible to crack?
  • #875
  • Mar 4, 2021 7:50pm Mar 4, 2021 7:50pm
Quoting acetrader
Would you share your views on what a trader should look for if we want to detect Algo patterns? Are there book sources for learning to spot these patterns? Your views, comments & suggestions would be appreciated.
First of there's no books that touch on this topic. You have to use whatever training and educational resource you collected in your life. You must maintain no assumptions nor bias.

There's no meaningful visual algo pattern that traditional technical analysis offer, example higher highs and lower highs or lower lows and higher lowers.

The "pattern" is seen in math format. That the calculations suggest a low probability of scenario A happen over scenario B at some pricing level. The real time probability changes with incoming data until it points clearly in one direction with no future data expected to significantly change the aggregate probability. This does not mean that actual price will not deviate from this probability which is expected to stay within the limits.

So based on this understanding its not possible to determine with the same level of exactness with visual look at ohlc candles or bars that traditional TA is based on price action and candlestick patterns.

If I were to trade a naked chart I will not know where to execute trades because I don't know where the probability lies. I don't know if its a rising or falling market. I can't make that determination based on price action and candlestick patterns.
Know what you trade
  • #876
  • Edited 8:28pm Mar 4, 2021 8:14pm | Edited 8:28pm
Quoting acetrader
Could anyone else crack the could if they put in the efforts as you did, or has the code be strengthen making it impossible to crack?
Many years back I learnt how to write codes on mt4 with the help of 2 forum members. Both of them are my mentors who went beyond the normal to teach someone from the generation that computers started. I have them to thank. I took it further to study the math behind indicators. This allows me to make exploration into the math that non-coders are not able to. I end up creating and throwing away thousands of indicators. This allows me the opportunity to learn the million ways that don't work in a short time. Today I use ZERO proprietary indicators.

The message I want to deliver is there's no magic proprietary indicators that you have to pay for. Don't waste your money.

The key difference is in our understanding. This is the fine difference, that's all. It took me years of research and more research to finally confirm with empirical evidence. The mt4 handphone apps is all we need. If anyone hack my phone or computer he gain nothing. Because there's no understanding written on it.

The huge problem is the indoctrination of misled understanding and widespread mis-teaching. Traders accept misleading understanding. There's nothing that can be done about this as a whole.

At the individual level, each trader has this choice to accept or reject motherhood statements and gospel truths. If the trader is entrenched in this indoctrination which most members are(99.02%), then don't waste time arguing on forum. Just carry on as we have chosen. A choice that each individual make for himself.

In short the message is question EVERYTHING or question nothing.
Know what you trade
  • #877
  • Mar 4, 2021 8:42pm Mar 4, 2021 8:42pm
Hi BW,

What you have done is absolutely amazing imo.

(And at my age I am not easily amazed any more)


I might still hope to believe that traders need not be overawed, and feel totally helpless without big data maths.


I say this as the algo seems also to love Targets. George used daily, 4 hourly and 15 mins Targets.

He traded one pair only and drew new fresh targets each day on his charts.

And George also REMOVED any targets which the algo had ‘taken out’ the day before - as they were now dead and removed from the charts.


I note that targets can also be seen on any TF and even down to the 1min chart (because I see the the algo as operating fractally). And I see the algo moves in ‘waves, not elliots, at the low TFs also.


I agree with you that the ‘now’ direction is the very hardest thing to know.

And especially with just my visual targets. Hard. As there will always (by definition) be a target BOTH above and below where price sits now.


(Simple TA and PA does assist me in its way at these times, but that is another discussion entirely.)


For example. With Powells’ testimony late yesterday the Fed based USD went into huge market volatility, leaving the USDJPY way high
at morning open on yesterdays single day move

So after Tokyo opened this morning (some volume at last) I was waiting to see if the UJ would make a new high for Asia (over yesterdays high) as it often does.

Then I would wait for a directional momentum change “confirmation”.


So on the chart below my initial trade was not at the ‘best’ entry possible.

But I wanted to see for sure that a newish directional move was underway.

I entered and got out for 10p. Then snuck back in later as there was a ‘new’ algo target lower, which gave up 5p. Asia was done for me after this.


Will UJ continue to go down? It may well go up and make new highs. Who knows. As a retailer I do not try and predict.

No retail trader can ever say for sure.


Algo, targets, TA and PA all help me to build a trade probability picture.

If I am WRONG in my assessment I then close out quick for a loss (at around DD 10-14p)

Which can be made up later.

In the past I would ride out the DD (don’t try this, I have used a personal method which takes ‘time’ and ‘plenty of anxiety’ and I do NOT recommend it at all it as I DON’T do that myself any more).

Imho only, - there is no need for traders to think that maths and big data is the only way. I do see a few ways to skin the FX cat.


But.

BW, you are a marvel for what you have done here. I honestly salute you, sir.




.
Attached Image (click to enlarge)
Click to Enlarge Name: USDJPYM1 visual algo targets.png Size: 27 KB
  • #878
  • Mar 4, 2021 8:46pm Mar 4, 2021 8:46pm
Quoting TimeTells
But. BW, you are a marvel for what you have done here. I honestly salute you, sir. . {image}
Tbh when taken into consideration the cost I wish someone else accomplish that, example my father, and he teach his son that's me in my teens. We're already in our 60's.
Know what you trade
  • #879
  • Mar 4, 2021 8:48pm Mar 4, 2021 8:48pm
BWilliam,

Thank you for sharing. I will continue on the path I'm on & always maintaining an open mind & questioning everything. After that many years of research, investigating & questing you deserve the success that earned knowledge will bring you. Once again thank you for sharing. Looking forward to your continued post on this thread. Best of trades to you my friend.
  • #880
  • Mar 5, 2021 1:56pm Mar 5, 2021 1:56pm
Quoting BWilliam
{quote} Tbh when taken into consideration the cost I wish someone else accomplish that, example my father, and he teach his son that's me in my teens. We're already in our 60's.
Hi B Wiiiam, I am 60 too. I am living in Iran at present . your comments very interesting. are you working with moving avarges or not.
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