To anyone criticizing HFT: You know that if you could do it and make money doing it, you would. Think about it.
I don't trade on the time and price scale where HFT can hammer me too badly. If I did I would stop. The game changes, either adapt or move on. Guys like me will never have home field advantage, I will always be bringing a knife to a gunfight so I must be that much better. I look for ways I can compete and never head to head against HFT.
On my last OJ trade they filled a 120.00 sell stop at 117.60. By then I knew that the phone call would only bring me more frustration. Never traded it since and I hate those assholes.
1) not losing a thing. if I dont get my price AND my signal , I dont enter. 2) Having to trade in a manner not comfortable to the trader is worse than not trading at all.
yeah...I traded ags/commodities when they were still doing all their size in the pit. Like you said..worst was if they hit your stop during a big move. The phone would always ring and you knew you were gonna get the low tick. Stop placement was critical back in those days. When I traded the Nikkei I had to use 5 different brokerages to spread out orders. One firm (who is no longer with us) would routinely screw me with prices. I had to play games with them on the phone. Act interested in buying when I had to sell....eventually I just gave them my tiny orders and gave the big stuff to the brokers that actually did well for me. But if I got jammed and had to sell into a down move, I knew slippage was part of the game.
1) Depending on what you are trading you must accept slippage. Otherwise you are gonna miss some great trades. 2) Adjust to get comfortable, or quit. Aint a perfect world dude.
This is obvious and trite advice. Sure, for a position trade, who give a shit about a nickle or dime on entry. I'm talking about trying to scalp.
I agree. If 50,000 shares of stock trades in a quick time frame the bots gs, whoever will try to get that new open interest out of the way by preventing a move, or pushing it back against said traders. I have also noticed that most of the time they have a breaking point depending on the securities volume ,time frame, minutes since open interest initiated then they let it go. Best advice I can give to traders who trade very short term is expand your time frame a little bit and cut down size. I also agree with bob111s comments on fake liquidity, this has been an evolution over the years and we as traders must adapt. Ten years ago I could have a large position in many stocks and be able to hit the bid if trouble happened, now when you try to hit a stock the fake bids, offers can move,this is legal because of the sec being bought and paid for. The only way to combat this is to trade smaller, I never trade more than 3000 shares at a time of volatile stocks like aapl,nflx, etc. Years ago trading in and out of 3000 shares of a stock like aapl that trades 15mil shares a day would be a piece of cake, times have indeed changed. Adapt, die , or get another job because imo it is going to get worse.
not to piss on your parade, but much of the liquidity is due to the penny quote. your memory fails to account for this, as an AAPL would have traded an 1/8 to 1/4 wide so sure, there was more net liq. on each side. Now, you think you're getting hosed when you have to swipe a dime lower.