Is ES rigged?

Sprout · Mar 22, 2023

volpri said:
No it is not rigged to squash retail. They don’t care about us. We are 5% of the trading. We are tortilla chip money. Candy bar money. All of us together do not have enough money nor do we play with enough money to interest them. The markets are the institutions taking money from each other. If we retail traders can’t make money it is simply because we are not yet good enough to understand and read the chart and divine what the institutions are doing. And which institutions are winning ATM, the bullish or the bearish institutions.
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Latest numbers are 20%
https://www.sciencedirect.com/scien...stock market participation,ago (McCabe, 2021).

SunTrader · Mar 22, 2023

Sprout said:
Latest numbers are 20%
https://www.sciencedirect.com/science/article/abs/pii/S0304405X22001726#:~:text=Individual investor stock market participation,ago (McCabe, 2021).
More...

And that was before GME GameStonk reported after the close yesterday a profit for the first time in 2 years - hehe. +36.60%

hilmy83 · Mar 22, 2023

Darc said:
You Americans trading after hours don't have many choices other than the ES do you? Seems to be a lot people here trading for a long time who are still unprofitable eg. the great @Overnight 28 years trading still struggling.

Any chance the Algos and big boys are deliberately preying on the Retail?
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Rigged? I think less rigged than the OTC CFD's and retail forex.

murray t turtle · Mar 22, 2023

Darc said:
You Americans trading after hours don't have many choices other than the ES do you? Seems to be a lot people here trading for a long time who are still unprofitable eg. the great @Overnight 28 years trading still struggling.

Any chance the Algos and big boys are deliberately preying on the Retail?
More...

%%
SORT of; with post market ETFs, but may not be exactly as liquid as reg market hours.
NO problem\ regular market hours are plenty.
WHEN CME warned you ES is designed to trade, they are telling the truth.
Some body gets the diVidends off the stocks + its not the ES buyer.
IF they are using swaps, the points still stand.

spooz · Mar 22, 2023

Scataphagos said:
I've been saying this for years. It's Price TA... yet ETers still call "bullshit".
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The thing about the "Indicator People" is that they are removed from direct involvement in the market. When they lose it was the indicators fault so it's easier to accept. The fault can also lie with bots, large funds, the Fed, brokers, etc. I get the impression that some of them have spent years going around in circles looking for the secret to infinite wealth. True believers cannot be reasoned with. Having said that, I hope they don't change.

Scataphagos · Mar 22, 2023

spooz said:
The thing about the "Indicator People" is that they are removed from direct involvement in the market. When they lose it was the indicators fault so it's easier to accept. The fault can also lie with bots, large funds, the Fed, brokers, etc. I get the impression that some of them have spent years going around in circles looking for the secret to infinite wealth. True believers cannot be reasoned with. Having said that, I hope they don't change.
More...

No worries. Human nature in general will never change. When you "get it right" it's for a reason. When you "get it wrong" it's because you don't understand the right reason... or you simply screwed up.

Sprout · Mar 23, 2023

ondafringe said:
Some years back, I ran across a post on another forum: An ES trader, trading, as I recall, 60 contracts, was getting stopped out much more than usual and wondered aloud whether something was amiss. Someone posted a very long response that I found interesting, so I saved a copy. Since it's related to the OP's question, I'll repost it here, FWIW, in its entirety, without corrections and without the posters forum handle. I have no idea whether this person knows what he's talking about.

That said:

70% of volume is well known and cme put out a study showing exactly how much of it is HFT and it is roughly 70 % or more.

the problem you are having is not the volume but the cancelled volume which for hft is 98 % for each order. they only get charged 1000 bucks a day to send too many messages per fill and there are lots and lots of wash trades which is why you are also faced with a wall of WASH. google it and you will see soime very good traders sued the cme and many have tried but the problem is that the code for citadel is sacred because it is all part of the manipulation machine.

the mkt is fake and thats ok so long as you know it is fake and trade accordingly. They will never let you get big enough as them quickly and that is because as duffey the ceo of the cme said. futures markets are for price discovery and stock markets are for wealth building. you understand there is no such thing as insider trading in futures right? You cannot make insider trading illegal when you are a soybean farmer and you have inside knowledge on crops etc.

You are noticing most of these problems ever since all of the equities went commission free where they sell the roder info before filling the orders this means everything. stops limits lit mit all of it!! so if indexes are run by 4 to 10 symbols why would you think for a second that the big hft and funds are not sending this infomration via microwave to the cme for them to be ready to do battle and capture even more. it is pure insanity for anyone to think that any and all discovery information is always i the futures first because there are no LAWS against trading on insider information in the futures stock indexes! there is lots of hidden liquidity tons of it obviously but sure they control all of it not you and me and we never will.

You can make money and a lot of it but at some point they have figured out no one can or will railroad them and or ever get to their level of play. think about it. you are a massive hft. you make money off of all of the futures mkts and you fill cash stock orders AKA citadel and many others. what is the biggest limiting factor you have? well you can limit anyone and everyones profit by making sure that as a SYNTHETIC mkt maker with no restrictions that you make sure slippage and commissions and fees will LIMIT just how much anyone person can put on at any given moment. YOU ARE NOT ALLOWED to become massive anymore it is just not in the cards anymore for fast scalp trades. it is for mainly hedges because any and all retail day traders are just extra pennies to scoop up. there is plenty of business filling orders and being aggressive. those walls are there on purpose and it is obvious and oh so very sad that they are working.

friend of mine trades prop in chicago and is a big player because the prop firm has the technology to make sure all of their traders get priority on the book and they get member pricing and rebates as a 106! cumulatively. so in the end you want to give up 50 % or give up 20 % to the prop firm. you save way more trading prop because when you pay 30 to 40 cents round turn you can actually rebate trade like the soes bandits back in the day since the cme has a very healthy rebate program and it is a whole new ball game to trade breakeven to win!!

MY advice is to go trade prop who will set you up i fyoua re any good and you can trade from home once they know you and your style and the amoutn fo risk vs money you bring into them. it is a cme rule as you must know that they can only take 20 % of profits right.

HFT should have to register and be considered and actual bonafide market maker and not be allowed to be as aggressive as they are in the futures and there needs to be a TAX ON FIX MESSAGES each and every one of them! this will stop the needless spoofing that is rampant still in the futures markets.

I have another friend who hangs out at DRW owners house on occasion and let me tell you he made 400 million when oil went negative in 3 to 4 weeks and he bought physical gold the problem was 2 jets to fly it to the usa from switzerland or 1 big one and what if one crashed was it cheaper to insure 1 big palne or 2 smaller ones? my point is that he told me straight up that they will on occassion just for fun when they see bigger orders completely destroy them right after they fill them. you buy a 20 lot they sold it to you. you are long they are short. they just sell until all the other algos and retail and cta's all see the technicals broken ultra short term and boom you are toast. this is true i have no reason to lie.

the code is sacred because we all know it is just one big electronic spoofing racket. you also know that dma get to ask the cme engineers for special walkarounds right? this is yet another reason the futures are the wild west and all of this craziness allows the arbs in cash to futures which is the same guys spoofing in the futures to make even more money arbing out the micro imbalances that they create.
the higher the mkt goes the more money people put into the mkts so the hft want it as bullish as possible but there will always be those big shocks because think about it. it is all paper money until you take out your money. stocks etc. so as hft pulls out billions and billions you must make sure the mkt sells hard and fast in order to make sure the mkt gets down low enough where people dont have time to sell and get their profits because how is the money actually even there to begin with it is not the hft and large banks have siphoned most of it off on the way up. if i am taking a penny on every share traded then explain to me how if the mkt moves in penny increments that there are still more pennies left? initially the pennies are all taken as slippage. yeah i know 1 share may add 50 dollars but i am talking about total turn over! how many pennies over the years or months of buy and hold from a turnover stand point of all those shares at a penny in and a penny out? so the hft needs the mkt to fall back all the way to the equilibrium point of where the mkt should really be in order to account for all those trillions in pennies being taken out. almost like an accounting ledger that must be balanced and they will always use as they always hve any and all news events to do this just like all of trumps tweets.

How do you beat this system.
1. you reduce the tick size of the emini and the nq to match the russel this way the gaming only costs 1.25 to 2.50 instead of 12.50 to 25 bucks! this will create a lot more CLOB limit orders at each level and will surpass the current 1/4 point increments. this is not done already because hft do not want this!
2. require HFT to be bonafide mkt makers who must accept a match even if sometime it is costing them money on some trades. they only take winning trades or create them right after!
3. change the operation of the limit order book auction process to a different form that cannot be as easily gamed
4. force any and all orders to rest and be valid for a small time period. logn enough to be picked off by other hft and or you at times. if you have intent to buy or sell then what is 250 milliseconds! sure this can be gamed as well but slowing it down will be good.
5. RIGHT NOW you can figure out other mkts to trade and not do all of your trades in the #es. the liqudity is what it is and it wont change so dont wait for it. the voaltility is exactly what they want and hve created they can do less trades and make more money. this is why most people do not spread trade and make big bucks anymore. the HFT owns all of that! that is why I hate HFT. in early 2000 to 2007 you and i could be mkt makers making 300 k a year without breakign a sweat and then 10,000 other traders could do that also and we all did very well but then hft came in and got so fast all we have left is the scraps! thats truth right there so again just like all capitalist regimes with zero regualation now we have 20 guys making 20 billion a year instead of 40,000 guys making 500k a year around the globe!

the hft have a monopoly of the CME monopoly. imagine if 20 people sold all of amazons goods? same idea.

i would look to trade multiple mkts in smaller size per mkt and use your same strategy or go trade prop.
TT and CQG and all of those very high priced pipe dream auto-spreaders are useless if you cannot get filled because it all gets eaten up
in slippage and fees and dont get me started on missed legs overfill and well you know the hangmans noose!

yeah the mkt really sucks for retail right now eventhough as usual they say oh yeah it is the greatest time ever ha ha ha right.

you can always take on a lot more risk and stay in your trades much longer and this will get rid of your execution issues but then again can you still profit overall and you will need to take on massive massive intraday drawdowns and hope it comes back and one day it wont, so size down on your dreams and your trades unless you can trade multiple mkts or have dma servers at the cme!! i mean being colocated these days is still not enough even TT has some stupid extra cost prime server which cuts down on your time just for their servers to push your orders but you have to pay extra for that too..

so on top of huge slippage and high cme fees we have to deal with hundreds if not thousands of dollars monthloy in costs just to get competitive with speed! not with our knowledge or how we value price but speed!! the speed race is almost over which means what you see is what you get. the next step for them is to own all of the speed which means they will open their own for profit exchanges. this is what i was told. they want total control which means they will group together and own their own exchanges making their own rules an charging for data which by the way!! data should be free since we are the ones who create it!!

back in the day i could call down to the floor and get a quote 100 times a day and they never said hey we are chargin you 5 bucks everytime you call and want to know what the mkt is doing that is another thing huge prices for data what the hell just insane. thats my rant and good luck!!

i got off track on one of my thoughts the problem with lawsuits on the cme is that you cannot show the exact damages the hft and wash trades and spoofing have actually cost you in monetary terms because no one knows the outcome of the trade you might have had so the cme always wins!!
More...

Great read, thanks for saving and sharing.

maxinger · Mar 23, 2023

Sprout said:
Great read, thanks for saving and sharing.

View attachment 309813
More...

The blue-shirt man stepped on / studied hundreds of books.

He ended up staring at another opaque orange-colored wall!

Then he raised his fist in anger / frustration.

At least the dark-colored shirt man didn't waste his time studying.
And he stared at the opaque brick wall not feeling angry / frustrated.

I believe the artist has a very different opinion from mine.

Darc · Mar 23, 2023

maxinger said:
The blue-shirt man stepped on / studied hundreds of books.

He ended up staring at another opaque orange-colored wall!

Then he raised his fist in anger / frustration.

At least the dark-colored shirt man didn't waste his time studying.
And he stared at the brick wall not feeling angry / frustrated.
More...

Would you say the Trading section of the Bookshop is similar to the How to marry a Supermodel section? Appeals to the get rich/laid buyer. Just gotta sort through alot of chit to find some Gold on those shelves?

virtusa · Mar 23, 2023

ondafringe said:
Some years back, I ran across a post on another forum: An ES trader, trading, as I recall, 60 contracts, was getting stopped out much more than usual and wondered aloud whether something was amiss. Someone posted a very long response that I found interesting, so I saved a copy. Since it's related to the OP's question, I'll repost it here, FWIW, in its entirety, without corrections and without the posters forum handle. I have no idea whether this person knows what he's talking about.

That said:

70% of volume is well known and cme put out a study showing exactly how much of it is HFT and it is roughly 70 % or more.

the problem you are having is not the volume but the cancelled volume which for hft is 98 % for each order. they only get charged 1000 bucks a day to send too many messages per fill and there are lots and lots of wash trades which is why you are also faced with a wall of WASH. google it and you will see soime very good traders sued the cme and many have tried but the problem is that the code for citadel is sacred because it is all part of the manipulation machine.

the mkt is fake and thats ok so long as you know it is fake and trade accordingly. They will never let you get big enough as them quickly and that is because as duffey the ceo of the cme said. futures markets are for price discovery and stock markets are for wealth building. you understand there is no such thing as insider trading in futures right? You cannot make insider trading illegal when you are a soybean farmer and you have inside knowledge on crops etc.

You are noticing most of these problems ever since all of the equities went commission free where they sell the roder info before filling the orders this means everything. stops limits lit mit all of it!! so if indexes are run by 4 to 10 symbols why would you think for a second that the big hft and funds are not sending this infomration via microwave to the cme for them to be ready to do battle and capture even more. it is pure insanity for anyone to think that any and all discovery information is always i the futures first because there are no LAWS against trading on insider information in the futures stock indexes! there is lots of hidden liquidity tons of it obviously but sure they control all of it not you and me and we never will.

You can make money and a lot of it but at some point they have figured out no one can or will railroad them and or ever get to their level of play. think about it. you are a massive hft. you make money off of all of the futures mkts and you fill cash stock orders AKA citadel and many others. what is the biggest limiting factor you have? well you can limit anyone and everyones profit by making sure that as a SYNTHETIC mkt maker with no restrictions that you make sure slippage and commissions and fees will LIMIT just how much anyone person can put on at any given moment. YOU ARE NOT ALLOWED to become massive anymore it is just not in the cards anymore for fast scalp trades. it is for mainly hedges because any and all retail day traders are just extra pennies to scoop up. there is plenty of business filling orders and being aggressive. those walls are there on purpose and it is obvious and oh so very sad that they are working.

friend of mine trades prop in chicago and is a big player because the prop firm has the technology to make sure all of their traders get priority on the book and they get member pricing and rebates as a 106! cumulatively. so in the end you want to give up 50 % or give up 20 % to the prop firm. you save way more trading prop because when you pay 30 to 40 cents round turn you can actually rebate trade like the soes bandits back in the day since the cme has a very healthy rebate program and it is a whole new ball game to trade breakeven to win!!

MY advice is to go trade prop who will set you up i fyoua re any good and you can trade from home once they know you and your style and the amoutn fo risk vs money you bring into them. it is a cme rule as you must know that they can only take 20 % of profits right.

HFT should have to register and be considered and actual bonafide market maker and not be allowed to be as aggressive as they are in the futures and there needs to be a TAX ON FIX MESSAGES each and every one of them! this will stop the needless spoofing that is rampant still in the futures markets.

I have another friend who hangs out at DRW owners house on occasion and let me tell you he made 400 million when oil went negative in 3 to 4 weeks and he bought physical gold the problem was 2 jets to fly it to the usa from switzerland or 1 big one and what if one crashed was it cheaper to insure 1 big palne or 2 smaller ones? my point is that he told me straight up that they will on occassion just for fun when they see bigger orders completely destroy them right after they fill them. you buy a 20 lot they sold it to you. you are long they are short. they just sell until all the other algos and retail and cta's all see the technicals broken ultra short term and boom you are toast. this is true i have no reason to lie.

the code is sacred because we all know it is just one big electronic spoofing racket. you also know that dma get to ask the cme engineers for special walkarounds right? this is yet another reason the futures are the wild west and all of this craziness allows the arbs in cash to futures which is the same guys spoofing in the futures to make even more money arbing out the micro imbalances that they create.
the higher the mkt goes the more money people put into the mkts so the hft want it as bullish as possible but there will always be those big shocks because think about it. it is all paper money until you take out your money. stocks etc. so as hft pulls out billions and billions you must make sure the mkt sells hard and fast in order to make sure the mkt gets down low enough where people dont have time to sell and get their profits because how is the money actually even there to begin with it is not the hft and large banks have siphoned most of it off on the way up. if i am taking a penny on every share traded then explain to me how if the mkt moves in penny increments that there are still more pennies left? initially the pennies are all taken as slippage. yeah i know 1 share may add 50 dollars but i am talking about total turn over! how many pennies over the years or months of buy and hold from a turnover stand point of all those shares at a penny in and a penny out? so the hft needs the mkt to fall back all the way to the equilibrium point of where the mkt should really be in order to account for all those trillions in pennies being taken out. almost like an accounting ledger that must be balanced and they will always use as they always hve any and all news events to do this just like all of trumps tweets.

How do you beat this system.
1. you reduce the tick size of the emini and the nq to match the russel this way the gaming only costs 1.25 to 2.50 instead of 12.50 to 25 bucks! this will create a lot more CLOB limit orders at each level and will surpass the current 1/4 point increments. this is not done already because hft do not want this!
2. require HFT to be bonafide mkt makers who must accept a match even if sometime it is costing them money on some trades. they only take winning trades or create them right after!
3. change the operation of the limit order book auction process to a different form that cannot be as easily gamed
4. force any and all orders to rest and be valid for a small time period. logn enough to be picked off by other hft and or you at times. if you have intent to buy or sell then what is 250 milliseconds! sure this can be gamed as well but slowing it down will be good.
5. RIGHT NOW you can figure out other mkts to trade and not do all of your trades in the #es. the liqudity is what it is and it wont change so dont wait for it. the voaltility is exactly what they want and hve created they can do less trades and make more money. this is why most people do not spread trade and make big bucks anymore. the HFT owns all of that! that is why I hate HFT. in early 2000 to 2007 you and i could be mkt makers making 300 k a year without breakign a sweat and then 10,000 other traders could do that also and we all did very well but then hft came in and got so fast all we have left is the scraps! thats truth right there so again just like all capitalist regimes with zero regualation now we have 20 guys making 20 billion a year instead of 40,000 guys making 500k a year around the globe!

the hft have a monopoly of the CME monopoly. imagine if 20 people sold all of amazons goods? same idea.

i would look to trade multiple mkts in smaller size per mkt and use your same strategy or go trade prop.
TT and CQG and all of those very high priced pipe dream auto-spreaders are useless if you cannot get filled because it all gets eaten up
in slippage and fees and dont get me started on missed legs overfill and well you know the hangmans noose!

yeah the mkt really sucks for retail right now eventhough as usual they say oh yeah it is the greatest time ever ha ha ha right.

you can always take on a lot more risk and stay in your trades much longer and this will get rid of your execution issues but then again can you still profit overall and you will need to take on massive massive intraday drawdowns and hope it comes back and one day it wont, so size down on your dreams and your trades unless you can trade multiple mkts or have dma servers at the cme!! i mean being colocated these days is still not enough even TT has some stupid extra cost prime server which cuts down on your time just for their servers to push your orders but you have to pay extra for that too..

so on top of huge slippage and high cme fees we have to deal with hundreds if not thousands of dollars monthloy in costs just to get competitive with speed! not with our knowledge or how we value price but speed!! the speed race is almost over which means what you see is what you get. the next step for them is to own all of the speed which means they will open their own for profit exchanges. this is what i was told. they want total control which means they will group together and own their own exchanges making their own rules an charging for data which by the way!! data should be free since we are the ones who create it!!

back in the day i could call down to the floor and get a quote 100 times a day and they never said hey we are chargin you 5 bucks everytime you call and want to know what the mkt is doing that is another thing huge prices for data what the hell just insane. thats my rant and good luck!!

i got off track on one of my thoughts the problem with lawsuits on the cme is that you cannot show the exact damages the hft and wash trades and spoofing have actually cost you in monetary terms because no one knows the outcome of the trade you might have had so the cme always wins!!
More...

I think that the problem is limited to people who scalp or who have trades with an average holding time of a few minutes at most. Basically it is called the HFT for retail traders.

When you have an average holding time of 30 minutes till a few hours, you don't have any problem with HFT. The commission and other costs are only a problem for people who trade frequently within one day.
I trade on average 4-6 times a day and have holding times going from 45 minutes to several hours (depending on the trending of the market). But I understand that scalping or very short trades doesn't need the knowledge you need for longer trades. The shorter the holding time the higher the probability the "trader" is gambling. For long holding times you need a vision or you get slaughtered.