This thread for us to post screen shots of what we believe to be algo patterns on the charts. Feel free to discuss the patterns and how you would trade them or anything of value. THIS IS NOT A THREAD TO ARGUE ABOUT if it is algo or not. Let's share some knowledge adn some pattern recognition.
Here is a triangle that normally(humans) would have been cleaner, but the algo's are able to spook humans out because they have the advantage of "painting the cahrt" and understand that they are the ones who made the pattern look unusual with big spikes outside of the edges. When you see this I thin it is algo stop running and spooking retail out of the trade 1 minute mini nasdaq dec 2018
basically the algos know human traders see the triangle and seeing it was formed off of amkt rally then the next thrust should be upward.. so they spike it up to get buyers thinking it is a break out. then the run it down to get those traders stopped out. and they will not run it higher until everyone is stopped ouit. extremely hard to trade patterns these days especially with momentum ignition from teh algo's. how can you put on a trade without knowing when the next 500 LOT ... LMO!! LMO is a LAND MINE ORDER.. i call them that.. 300 to 3000 lot orderes that fire off for no reason.. not stops bu they will fire into stops creating false momentum
What do you mean by "they spike it up to get buyers thinking it is a break out". Are you suggesting that "algos" are some how colluding together to create a particular market pattern that they can later fade? If so, perhaps you could explain how that technically works.
above triangles you have buy stops to enter and buy stops to exit... traingle trding is basically a breakout strategy. It doesn't take collusion.. it actually only takes a one lot trade at price to trigger all the stops. that is why you will hear institutional traders and prop traders constantly laugh about the power of a (1 Lot). the trigger is just 1 trade at price. However, typically the algos will put on some size because it has been proven that large size volume on a chart spooks retail investors from even trading lots of times. the programs just spike the mkt to "rapidly initiate order matching to spike the market" this happens above and below the triangle. Now if YOU or your algo created that spike even at a LOSS you have intimate knowledge of the chart and chart pattern. It also shuffled the limit order book whihc is analyzed and they keep shuffling the deck until it is completely in their favor and they can run the market higher without any retail traders involvment. this is why the MARKET ALWAYS stalls when you finally decide to trade befroe the breakout or if your stops are right above the breakout. You cannot have sellers.. retail scalpers selling into your short rally.. you need to clear the book and stops so when you do initiat the real sustained move higher that there are not any orders to sell against your orders thus stalling the move higher and more importantly CHANGING THE FIFO of the limit order book and all the other orders on the trade engine. it is a timeprice priority and and any every trade has an impact on teh dynamic of the market. THIS IS WHY YOU CAN DEMO TRADE OR PAPER TRADE BREAKOUTS and you always win. the market does not react to your fake trade because it is not instantly analyzed by real trading algos
a fun test for this if you have a real account is to place an order on teh demo account in the overnight mkt and see what happens to the mkt you are trading. Pick a thin market like the rusel 2000 mini. and watch as not much happens in the market.. then palce an order Live.. the exact same order.. say 3 levels above or below the best bid or offer and watch the market instantly start moving to come gobble up your order. NOTHING chagned excpet you palceing a 1 lot wither on the book.. or even sometimes with a stop or stoplimit order. this minute change changes the book and the HFT cancel most orders to come fill your order.
Lol ... You can do all that at the speed to match hfts!? Are you renting a desk in Aurora DC? You funny, man.