I didn't realize ...but thanks to Mark, I've just realized that high frequency traders (HFT) are evolution (mutation) of scalpers.
The reason why i asked this question is cuz the patterns that unfold during intraday are usually for one minute charts but im curious to know of those patterns also apply to 5 min charts. 1 min charts sometimes move too fast for me to make a decision.
I first heard of the term scalping by some institutional traders in the early 1990s during the growth of the dot.com days. In contrast, I believe HFT started around year 1999 or 2000 after some key changes in regulations at the exchanges that left open a loophole involving order transparencies. Simply, the exchanges under estimated the existing algorithms...they didn't realize algorithms at the time would go from seconds to milliseconds in about 10 years and now to microseconds the past 5 years. Seconds ---> Milliseconds ---> Macroseconds Note: Quantum will be available to algorithm trading in 10 - 20 years. Unfortunately, the exchanges failed to update their order regulations for that type of speed. That's the loophole that's being exploited in the old order regulations even though most of everything else has been updated. In my opinion, that's suspicious. To make things worse, the exchanges then gave them "special privileges" I think around 2005 or 2006. That's when algorithm became even more popular with many different institutions, hedge funds and so on because they wanted to compete with others that already had it especially because it was "easy income". Today, its big income for many which is why they are hard at work to prevent losing those "special privileges". So yes, in many ways...algorithm, automation or HFT is an evolution from scalping. Funny thing though is now with the cost of such coming down...more and more retail traders are developing/using their own algorithm systems that's exploiting flaws in the algorithm system used by the big boys. In fact, comically, these same big boys are saying its unfair and they want the regulators to do something about it. The thing that's odd is that with all the news about HFT (bad and good)...less than 10% of all firms use HFT while that small percentage accounted for about 70% of the volume in most key markets. That's absolutely crazy and almost unbelievable. Just imagine if 50% of today's firms were using HFT...there will be an absolute war between these firms and I bet those order rules will then be updated. Yet, the involvement of HFT is much less in Europe and Asia in comparison to the U.S. Thus, someone complaining about HFT in the U.S. should then be only trading European stocks or futures or similar in Asia as a solution. In fact, I know a few Emini futures traders that have moved into European (e.g Eurex CAC40 futures) and Asia futures (e.g. Hang Seng HSI futures) until they develop their own algorithm systems so that they can compete with the U.S. firms using algorithms. Lets put it this way, if you start hearing more and more retail traders being arrested for their "algorithm systems"...the conspiracy theorists will start pointing their fingers at the big boys putting pressure on the exchanges to stop it and we'll start seeing more crazy out of nowhere price spikes that go one direction and then just as fast retrace back so quickly that only automation trading could have traded such. Scalping is a tough trading style to be profitable in today's market environment which is why I believe the definition of scalping has changed dramatically in the past 5 years or so. Its primarily linked to changes in HFT. Yes, the human mind can process info in macroseconds (originally thought to be milliseconds) accordingly to research but we are not able to consciously react for up to 5 - 7 seconds. What that implies is that our brains can compete with algorithms on the decision making level... Yet, our brains than takes 5 - 7 seconds to signal an execute (react) to that decision via something as simple as clicking a mouse. Simply, algorithms kicks our but when it comes to the reaction process to the decision we've made. That's why scalping has become extremely difficult these days in comparison to the 1990s. Scalpers had some key regulation changes that almost buried it and now HFT is becoming more popular...putting more pressure on manual scalpers while at the same time encouraging more automation scalping to compete with HFT...not sure if anyone here has notice a slow increase in the system design threads, programming threads and automation threads here at ET by retail traders... It's simple, traders are adapting including scalpers. That adapting and competition will become more of a fair playing ground if companies like Microsoft and Google can get Quantum computing available to the masses in 10 - 20 years prior to Wall Street being able to use such before retail users. P.S. I've been developing an interest the past 3 years in Cognitive Science, Decision Making Analysis and Psychology.
Nobody can help you because you didn't "the patterns" you're talking about. I suspect you're talking about specific chart patterns. If the 1min chart moves too fast for you...don't use it.
Same patterns appear in all time frames. However, one way to find valid intraday patterns (described in your trading book), FIRST, you need to have a good understanding of moving average and candlechart (e.g. hammer etc) e.g. candlechart http://www.elitetrader.com/et/index.php?threads/trading-hammers-revisited.52880/ Second, you always have to use multiple time frames (e.g. 1 min, 5 min, 15 min etc) to determine valid patterns.
Scalping started in the pits and as cost of brokerage came down, one from home could start doing it. Basics can be applied whether monthly charts or 5 second charts. Precision must be better in smaller timeframe and very low losing percentages must be number one as more trades the smaller timeframes you use. Methods of entry must be high back testing along with money management, longer timeframes are much different calmer mindsets, you have more time to figure what to do, smaller timeframes you have to breath your actions.
Noooo candle stick patterns are statistically proven to be utterly rubbish, there randomly generated as markets dont run by the minute or 5 minutes. Stick to 1 tf aswell more just gets confusing. Bollinger Bands, best I have found so far, same settings appear to work with all TFs.
cashclay, I'm very surprise you're still being vague about patterns you're talking about especially after your prior thread about that specifically @ http://www.elitetrader.com/et/index...trends-work-for-all-time-frames.292884/page-2 Its simple, whatever patterns you're talking about...backtest it within whatever trading plan you're using. If you don't have a trading plan...please stop trading.