GTG is a biotech stock with a commanding shareholding by its founder and CEO. There were a series of about 9 trades each of 215 shares today from about 2.30 pm until close. I have feeling this general subject has been answered elsewhere on the forum but I can't locate it. Any idea what the strategy behind this type of trading might be?
I am holding CFDs in the back drawer because it is the sort of stock that bursts out the blocks very so often, and it has an "end of Stage 1" look about it..
Algorithmic Trading,hailoh,we call it Algae for short.In Short Term,the MAINthread of MBP,metabolic something,towards the end there's a bit of a write up or you can put in Algoetc into Google and find it. That's what it IS,hailoh not piffle about Institutions keeping up with the slight moves in their Index Funds or anything else dreamed up by Dills. Algorithmic Trading,it's come to a share dear to you.
I'm fascinated by what algorithmic trading is trying to achieve. With GTG, at end of day there were 5 buyers for 89456, 2 sellers offering 53030. I have a feeling the 50000 was placed after 4.00pm.
The nine 215 trades plus another couple around 268 were at 36c. Two trades amounting to 3227 at 35.5c went through after 4.00pm.
Supposing the 50000 was responsible for the algorithmic trades and it succeeded in enticing enough of the 5 to go to 36c instead of 35.5c. The difference would be $250 less costs. I don't know how brokerage treats small trades like that (maybe the 50000 had to go on to avoid brokerage on the bait) but it seems like a lot of huffing to try to get not much puff.
Still, if it were repeated over a large enough number of stocks it might not turn out to be such a bad day's work after all(mainly for the brokers of course).
The Oceans/Markets are Efficient Only a Mad-Dog could assume you could move markets with a series of a few $small bets
Many have tried over the ages with really "BIG" money and all have failed Crikey! What chance do you really think a few miniscule "algae" trades have in shaping the seas and weather conditions of any market?
Salute and Bon Voyage
"While we stop and think, we often miss our opportunity." Publilius Syrus, 1st century B.C.
"I believe the future is only the past again, entered through another gate." Sir Arthur Wing Pinero 1893
"There are two times in a man's life when he should not speculate: When he can't afford it, and when he can." Mark Twain, 1897
Hailoh, The point of Algae Trading is to maximise sales[or buys] without disrupting the Depth."They" don't pay brokerage like you or I."They" are beyond worrying about Brokerage,"They" can make No Cost Ploys!! So that is what 'Legitimizes' them to,say,ASIC."They" are a force against AGAINST volatility. Now I've identified that this IS what those small parcels are all about. I've also stated how this can be used as an Indicator.To see what ONE BigBoy is doing. I'm currently pondering how to use d'Fact of Algae Trading by d'BIG can be done by us peasants to OUR advantage but Hailoh, You have to ditch ALL feelings that Algae is a PLOT!! It's wholly Legit.Allowed,friend so then you move on to "subverting d'Dominant Paridigm",making the New Whizz Bang work for you,YOU!!! so,well,bear with me or better yet give us ya thoughts. cheers, jr ps-chuck?bug off!!
G'Day Dug Long time no speak. Correct me if I'm wrong but what you are saying sounds very much like cross trading to me which of course is illegal. I have also studied market depth in full for months on end until it became just non purpose and just stuck to the simply trading terms and have never looked back.
Anyway just thought I would clear this with you if I say too much I will as normal just get shot down in flames.
What you describe is AOP - Automated Order Processing - and is described in my second link below. The other name for it is Automated Client Order Processing or ACOP.
It is worth following up every one of the following links.
I have done a lot of research on this, and have several emails in response to my queries to the ASX.
What stands out to me is their outright denial that robotic trading was occurring - they played dumb with me until I was able to send them a screen shot of the course of sales. I questioned whether the buy/sell participants in these orders were in fact the same operator/broker!
Of course they are the same operator - but they use different computers to place the robotic (algorhythmic) buy and sell orders, so that the IP address does not match for identification.
After presenting my findings to the ASX they then admitted what is happening. Algorhythmic has been a part of their policy since 2005, and the first link proves the "why" and "how" of the demand for it by clients.
To keep this shorter than it might end up, algorhythmic trading is the process whereby electronic software submits small orders at highly strategic times, (and may at the same time place unusually large dummy bids/offers in the buy/sell queues) in order to artificially inflate or deflate the price of a certain stock.
In other words the robotic trader can step up the price or step it down, simply by placing a small order at a highly strategic moment.
"Wash" trades (buying and selling to yourself) is illegal, as seen by the ASX and ASIC proceedings against Nomura a few years ago. But this "bot" (robotic) trading sails very close to the wind - one step away from "wash" trades in my view. Legal, but ...
"Bot" trades have happened to PDN and SMM recently.
Now for the links - if you wish to know what is happening, look at each one thoroughly.
This link is interesting in that it outlines the rules of Section 13:4 - "Prevention of Manipulative Trading". The ASX has these provisions in place, but relies on the rules being self-enforcing - there is very little anyone could do to prove manipulation - even course of sales data could be disputed. http://www.asx.com.au/supervision/rules_guidance/asxl/asx_section_13.pdf
The above links should be at least browsed to get an idea of what this is about.
But look at page 15 of the document below - the ASX has dealt with heaps of manipulation - we are just not informed of it.
I would suggest that every complaint we make IS investigated, and I am certain action does result from our complaints, where genuine.
At the risk of being boorish, I post the course of trades for SMM on 16th November 2006.
As you can see, these "bot" (robotic) trades had the scene almost to themselves.
The figure on the right side of the column is the number of shares traded. I am not saying this is manipulation (in this case) but the huge number of tiny trades is proof of bot activity - and is becoming more frequent.
The whole point is this: If it is convenience, why not have the shares bought as a bloc?
If it is not for convenience then what is the motive and what is the benefit? For whom?
Here's my final post for the night! And probably more interesting than my others. It's a copy/paste from a newsletter - from www.investmentu.com *************************************
Dear Reader,
There's a reason the average pay of Goldman Sachs' 24,000 employees - from secretaries and assistants to CEOs - was a mind-boggling $520,000 last year.
The company is a profit-making machine!
This year, Goldman Sachs will rake in between $30 and $35 billion in revenue.
That's enough to hand all 300 million men, women and children in America a crisp $100 bill - and still have a billion or two to spare...
But here's what most investors don't understand...
Goldman Sachs didn't become the financial powerhouse it is by collecting fees and commissions from investors like you and me...
Nor did the bulk of its profits come from underwriting such high profile public offerings as MasterCard and Bank of China.
No sir...
Private, 'Behind-the-Scenes' Trading
The lion's share of Goldman Sachs' profit - nearly two-thirds of it - comes from its own private account trading.
In fact, the company is on track to generate roughly $22 billion in revenue this year by successfully doing what every trader strives to do: Buy an investment at one price - and sell it for a better price hours or days later.
(Goldman Sachs') primary source of profit has shifted from banking to trading, and the firm is intentionally quite vague about how, and precisely where, those trades are made or, equally relevant, from whom the profits are coming.
The Economist, April 27, 2006
And Goldman Sachs isn't the only one racking up huge gains from 'behind-the-scenes' trading...
Lehman Brothers, Deutsche Bank, and Bear Stearns also recently reported that private trading accounted for more than 50% of their profits.
Now here's the billion-dollar question:
How are these trading firms able to generate such obscene profits so easily, so predictably... so matter-of-factly - while even the best fund managers seem to struggle to make a profit in this market?
Despite what you may think, there's no secret team of stock-picking whiz kids.
There's no Buffett-like guru at the helm.
In fact, the men and women behind these huge profits aren't stock experts at all.
'Mechanized' Trading
Instead, they're the country's top mathematicians, computer scientists and software engineers who have developed highly sophisticated computerized algorithmic trading systems, which quite literally can 'see' into the market's future.
These super computers leave nothing to chance.
No hunches or guesswork.
Human logic and emotion are completely removed from the process.
They take millions of pieces of market data that have occurred minutes, hours and days prior... analyze them... and then 'predict' - with extraordinary accuracy - where the price of a stock, ETF or commodity will go next.
It's a technique called 'quantitative algorithmic analysis'... which, simply put, is a process that states: 'if A, B and C occur, then D is the likely result'.
Meteorologists have been using this technique for decades to predict the future movements of hurricanes and storms. They take data collected from the storm, combined with inch-by-inch, minute-by minute movement history and other weather variables, then feed it into the latest super computers loaded with sophisticated algorithmic software...
Within seconds, the computer spits out the storm's most likely path, the speed at which it's likely to move... and the strength it's most likely to reach. That's how weather forecasters can know with such a high degree of certainty where a storm's heading - and how so many lives can be saved through warnings and evacuations.
But in the financial world, this technology doesn't save lives...
It makes people with access to it fantastically rich.
It's almost like having an automatic money machine... just turn on the switch and let the profits fill up the room.
$30 Billion in Profits - As Effortlessly as 'Flipping a Switch'
In fact, when the top five trading firms 'flipped the switch' last year, they were able to quietly extract upwards of $30 billion in trading profits from the markets with stealth-like precision...
That's over $82 million in profits... every day of the year!
Of course, you or I don't have direct access to Goldman Sachs, Lehman Brothers or any other trading firms' proprietary systems. They're reserved for their own trading... and maybe a handful of billion-dollar clients... ************************* Well - that level playing field just got terribly lop-sided! You may be wondering, "Where did that $30 billion come from?" The answer is: From you. And from me. When you get stopped out of a trade. When the trade suddenly turns against you soon after entry ... and any other scenario you could name whereby you lost a few dollars.
You put it down to "normal" market activity, and resolve to pay closer attention to your entry timing.
But unless you can think at the speed of a computer, you may be just a few nanoseconds too slow in this new trading arena. Computers programmed to react as soon as "normal" traders place their orders are no longer the science fiction of HG Wells, or George Orwell.
Thanks Ingot54 and other contributors. I am getting the picture.
Ingot, in the case of SMM this series of trades preceded a rise in price that carried through during the following two weeks. It will be interesting to follow GTG.
Hilarius both now and in his prior incarnation sought the holy grail for ages without much success. It seems that it does exist after all, but in the shape of a package of maths living behind a screen.
One of the key things to remember about bot trades, is that on the occasion they force down the price, it is a 'buy" signal.
I have seen this many times - SMM and PDN both sold down on bot activity then the next day jumped even higher in price.
Conversely, stepping up the price bot-fashion sets up for short-selling.
Both mechanisms work short-term, but I believe it is just a method of manipulating price so as to shake out weak hands. You can see this by the occasional large parcel that goes through between the bot trades.
I may have not have the reality (of what is really happening) down to a fine art just yet, but I will keep researching ... and where I can, watch it at work.
Two things have come out of this:
1) The ASX is a-moral.
They don't care about grey areas, ethics, and the Mums and Dads trading their super funds, or petty parcels. They are in this for the money.
Period!
If it's legal, they'll allow it.
As I posted above, they make and interpret the rules. The "rules" have yet to be tested in a court, but I don't expect that to ever be an event!
Note: "Legal" in no way belongs in the same room with twins "Ethical" and "Moral".
2) There is a new trading paradigm.
The old saying: "Lead, Follow, or get out of the way" applies here.
By that I mean trading is changing. We are now in the electronic age and had better get on board, or find another method to trade the markets. Thankfully it doesn't look like this will be an overnight revolution, but we are seeing the beginning of another application of technology to financial markets.
It has been happening for quite some time in the USA (estimated 40% of trades in April 2005 were electronic "hands off" trades in USA markets) but now it is biting us here.
Complaints to the ASX are actually met with the "dumb" response first, but when evidence is presented, they admit: "Oh yeah. AOP trading. Yes well ..."
I actually want to know how I can benefit from this. Given that I am a participant in a financial market, and that this market is not known for its generosity unless you know how to play, I need to know how to play if I wish to continue to participate.
I don't think you can just sit back, play the paranoid and cry "Foul". You have to dig deep, take a breath and go back to learning.
The market is a beast - its nature is unfathomable in its mutations and gyrations.
Nice work Ingot And when you check out Perler's trading platform post for the s&p you get an idea of what any individual is up against in the competition for a quick buck. I reckon you have a lot of knowledge bottled up inside you Ivan,How is translating into dollars ?
napolian, Can run for a month,even more.When I [and Ivan]first spotted this activity it was in CBH,a year or more ago,and it seemed to go for ever!! I've seen it going against the Bid and Ask at the same time!!So two machine traders vie for these under $500 worth parcels. I think it[Algae] has been introduced in Oz by the ASX eliminating Brokers ID's.Used to be that Brokers' screens were able to identify which broker was Buy/Selling,the ASX eliminated this and it seems to me that was when Algae Trading became prevalent.
but napolian,your ARH[isn't it?]anyway the share you mentioned in Short Term can also be suffering from the 10/12 Resistance.Seeing as the tick has increased from .001 to .005,then you often get these "dudes"buying and selling say $20 grand worth on a single up tick[make a grand$].
Anyway,to answer your primary question It[algae] will float around til it's "satisfied".Really dull screen watching,you want to Sell say and you get a dozen emails telling you another drop has hit de bucket!! back2It, jr
Yes I am holding ARH but it too seems to be suffering from algae problems.
For the past week the price was pushed down with small numbers and then when they hit a low the same numbers (qty of shares per trade) seemed to control the window.
The blocks of shares which were traded fluctuated in size but they all kept well below the 50,000 share size, some have been really low. I saw one trading at an embarrassing 382 shares... very low. Now, don't call me stupid but 382 shares at 9 cents a share does not give you much profit. I could not even pay my brokerage fees with that one and that pitiful bid had friends.
When I was looking at Etrade listings, they were all similarly low quantity of shares not too high to raise the price and if a person did come in and raise the price, a small share would bring it back down again.
I can understand the $20,000 boys trading but there were an endless sea of 2000 share trades now that at say 9 cents... that does not equate.
It was too similar to be coincidental.
You mentioned PDN earlier well I was a victim of that one and I was indeed peeved. Lost a bundle.
So, I would like to manipulate the bots if poss, but how.
They do seem to stabilise the price leaving only a small margin for % earnings.
Are they trying to lower the price today knowing that it will go up in the longer or shorter term?
Also I don't understand this comment and you get a dozen emails telling you another drop has hit de bucket!! back2It,
napolian, you have to determine which way the Algae is going.If it meets the Bid it's selling.Do you understand? If you identify how the Algae is flowing,buying or selling,then you know what One Big Player is doing. Meet d'Bid and it's Selling.
anyhow,when this first floated in a year o'so,Commsec didn't provide Depth or Course of Sales data in it's basic package[not the Premium one]it has this effect of Flikkering the share on your screen,hey?like watching your List you go"Oh xyz seems to be Active"and all it is is some two bit Algae Trade!
as for your last bit,napolian.Say you're bidding and put ya order in for say 50,000 at 10 cents,well if the Algae are selling in 8000 lots you could get at least a half dozen emails from ya broker over half an hour telling ya another bit is Gone.Algae is sometimes described as Drip Trading,too. d'Name Drip describes it's participants as well as action
I believe you're right in what you say, Redback - we can waste a hell of a lot of time chasing correlations when there are some very smart mathematicians/programmers et al who are being paid to frustrate that very endeavour.
Drip traders aren't interested in manipulating the price. Dumping a million shares into the open market would be trying to manipulate the price.
Drip traders are interested in getting an average price in a price zone by stretching out a larger volume of shares over a period of time. Once this is achieved they hope as much as we do that the price moves in their direction.
I had reported the drip trade in PMP in September. The drip buyer would have had no interest to see the stock climb UNTIL their position was established.
I think people are so scared of algo trading because its a different strategy and maybe one they don't understand. If you only have one choice of order, would you rather have a market order or limit order? If you had to move $1,000,000 and you only had one choice of style would you rather have the firehose or the sprinkler?
Thanks for the insight Dug. In hind site, I would say that the price was being kept around 11 cents most of the day so I would say that the big fish was in a buying mood. There were some larger bites which raised the price every now but it quickly retraced to 11 cents. So, I'd say they were in a buying mood.
Anyway, ARH is in trading halt now so I guess I will have to see how it goes tomorrow.
I have found this thread fascinating and express my thanks. As a relative beginner to trading I will continue to study the links posted over the Christmas period.
I have had a major success holding a large parcel of CBH from Jan 06 to Dec 06 and perhaps I should thank the Bot for that?
Would someone care to comment on my current attempts to sell IFM at $0.865. I have been the first in line since Nov22 and have sold numerous small lots of between 50 and 1200 and am still sitting there with 18075 leading the Asks. Do you think there has been a Bot involved here or is that just true supply and demand?
What is it with these conspiracy theories? The bot takes the bid or the ask. What is the point in running a bot which uses limit orders if you are buying according to some algorithm to get a specific precalculated price scenario? The limit order would get into the way of the algorithm.
Your order should have gotten filled Nov 29 unless the price was driven by off market transfers. You describe another problem with targets: either use a limit order that meets the bid once you want to sell or use a trailing stop from there on.
Mike-re your current problem?are you being Under Asked?like are other Sellers coming in under you so the Action doesn't really HAVE to hit you all that often?
As a General Comment,I think some Brokers allow their clients Fixed Fee Monthly Brokerage on a reasonable number of single trades.If one is dealing in shares that have Liquidity Problems for your position sizing,then perhaps this System[fixed fee]would allow you,the Pilgrim,to join in on some dripping of your own and gain the perceived Benefits of "chopping" Volatility while you buy or sell.
okoolnutz,d'Pilgrims like to Feel Downtrodden,maligned by the BigBoys,trapped in a Conspiracy that they wish the Good Guys[ASIC???] would fix for them so their Grand Plans would work. Seems you and I know the Only way is to Subvert.Beat d'Big at their own Game. Brokerage is THE Least of your Concerns.Forget about the Costs and Go4 the PRIZE,Hell'n'High Water,ya just gotta STEAM. cheers, jr
>>Mike-re your current problem?are you being Under Asked?like are other Sellers coming in under you so the Action doesn't really HAVE to hit you all that often?<<
Yes this is exactly what's been happening for the last couple of weeks, sometimes there are a few sellers coming in at $0.86 and then just as I get to the head of the queue again the same thing happens. Because of the buoyant market I have been determined not to drop my price below $0.865 and I'm still persevering.
Just want to clarify Dug's post of 3:05pm 14/12/06:
I had nothing to do with this discovery - it was all Dug's fault! He alone placed several posts on IC forum complaining about "Drip Feeds". Don't blame me!
No one took him up on the discussion for quite some time - about 10 days from memory.
I actually entered the discussion later - when all the "work" was done, as is my custom!
MSParks - I am still self-destructing - up 60% + on my a/c for a few weeks, then closed all positions and took the wrong call on a couple of Aussie Index contracts!
Love it! BOOOOM! BUSSST!
Currently I have only VCR in my caboodle - for all the wrong reasons, of course.
I have heaps of them, and adding more at every opportunity!
Wouldn't have it any other way.
While I can still work, why would I want to make a living trading shares?
OKNutz - Don't rain on our parade!
If we want to think it is conspiracy, please allow us our moment of Paranoia! We deserve it!
One question going begging you might be able to sort for us confused plebeians ... You can see in the course of sales above that there are heaps of trades going through between 10 and 300 in number.
If there is nothing to be gained by this, why not just buy/sell 6,000 or whatever in one parcel?
You can see the above trades are spaced apart by mere seconds - proof that it is robotic, unless someone can calculate like Einstein and react like Cassius Clay!
But I do share your belief:
"Drip traders are interested in getting an average price in a price zone by stretching out a larger volume of shares over a period of time. Once this is achieved they hope as much as we do that the price moves in their direction.
One thing to emerge from this is that trading is not the same equation of order/buy/sell as it was.
If Goldman Sachs can now rake in "$30 - $35 BILLION ($US)" it won't be long before EVERYONE will want to trade this way - you may well see a proliferation of "home software" so that "you too can trade like a professional"
And how long will it be before Incredible Charts comes out with the Incredible Bot package for paid-up members?
Robots do indeed exist. I have a friend who gambles on just about everything in the world and he is one of the wealthiest people I have met and I have met quite a few and this person uses a robot. FACT.
Cab drivers are killed for $10 and so if a billion dollars is on the table, well, people will go to any lengths to get their hands on it and robots/technology is the way to go.
I have discussed international share trading with my friend who also just happens to be a f.....g genius when it comes to numbers and he has considered moving away from gambling and into the stock market but quite frankly, he is making too much money.
Robots in gambling do exist, I have seen one in action, I have seen it win big and lose big, as my friend says, it is all about moving the odds in your favour.
Are we paranoid, maybe but that is what keeps us on the edge.
Robots do exist it is a FACT.
The powers that be undoubtedly know about it and couldn't care less... too much money involved to stop it. They are probably trying to work out how to get their share of the kitty if the truth be known.
Remember the banks... they look at their customers as 20 - 6- 20.
20% they don't want (the pitifully poor) 60% they don't care about (average Joe on the street) and then there's that 20% (the powers that be) they are the ones they really want.
The big houses of trade that use robots are that 20% and if you bring them down so goes the market money.
I consider we here on IC to be the 60% and we are fighting for a piece of the pie and good luck to us.
As we stand right now, can we win against a robot, I doubt it, but if we know where it is and how it is trading, maybe we can use it as an indicator to move the odds in OUR favour. I think that is our only chance at this stage.
People seem to lack understanding of what a robot is and how it is used.
There are two types of bots. A bot executing instructions as designed by its architect (the human) and a bot based on artificial intelligence.
The former acts as instructed and will not adapt to changing life situations without further input from a human. The latter has the ability to adapt without further input from the human.
It makes no sense to discuss AI bots in trading because if somebody had a profitable AI bot they sure as hell would not tell anybody else. Profits would be limitless. A single AI trading bot could destabilize the entire monetary system.
Regular bots do only one thing: execute a strategy which was determined by a human. A robot is only as good as its human designer. You can create your own bot. Download ProRealTime. Code some filter. Run a backtest. Feed the code into an automated trading system that you can purchase online and start using a bot for trading.
My current trading system could be coded. The reasons I don't do it are that I am a bad programmer, I can visualise my setups but I have trouble describing it in pseudocode and I enjoy looking at charts and making the tough decision. It's a test of my mental toughness to stick to the plan. Creating a bot trading system has no mental strain because the human is removed once the system has been proven as profitable. No human is required to push the buttons. It lowers costs. Bots are there to ease the workload and the costs. They are no magic bullet. You still have to do the hard yards to develop the code. The code is the trading strategy.
Why didn't the bot just buy 2500 shares? The bot didn't because the bot can't forecast the future and only act on what has happened. Imagine the bot wants to buy 50000 shares of a stock. There is a ASK size of 50000 currently in the system. The bot sees it. By the time the bot sends his BID the ASK could be pulled from the market and because bots use market orders the BID would be met at a higher price point. The entire basis of using a bot to gain access to a precalculated methodical price has been destroyed.
I will give you a perfect example of bot trading:
PDO traded as follows on December 15, 2006.
BID 0.60 0.70 ASK 0.77 0.90 The stock opens at 0.70 as some small seller dumps some shares.
BID 0.60 0.70 ASK 0.73 0.77 0.90 A bot monitors this stock and sees the large volume to be scooped up. The bot could send a market order for 400,000 shares but runs the risk the ASK is pulled and he will get filled at 0.77/0.90. The whole world would suddenly pay attention to PDO if it opened at 0.70 and jumped to 0.90 on 400,000 shares.
So the bot splits the order into separate small orders and sends them to market a few seconds apart. The time between the orders allows the bot to see if the ASK of 0.73 is still there. If the ASK vanishes the bot can stop the buying immediately.
The bot got the shares and the best price, the bot didn't put undue pressure on the stock and the price remained flat in the chart. The action took only a few seconds and is hardly detectible unless you watched PDO transactions that day like I did or use the TMF indicator which shows an increase in positive money flow.
Bots use market orders to achieve a price goal based on average market fluctuations. By doing so they are running the risk of not achieving the goal unless they split up the orders over time to make sure bids/asks that are frequently pulled out of the market do not adversely affect the strategy.
It's not that difficult to find out what institutions are doing. Find a chart with a consolidation and then watch this stock for a day continuously. Watch the size of the orders, watch re-occurrences of same lot sizes, watch for periodic orders (every ten seconds, every minute). If you are really skilled, you can even detect a drip trader's size being split up because the other side was met by two separate offers (443 drip buy lot split into two fills due to sell sizes of 200 and 300). It's tape reading and if you spend some time at it you get a feel of how things go.
Have a look at BKW for me today lots of little sales and a few small but similar size sales, is this a possible Bot attack?
BTW my perseverance with IFM at $0.865 is slowly working. This morning I was once again at the head of the queue yet over 40,000 were matched ahead of me at the opening, later on someone took 6000 off my ask, only 10228 to go.
Can I take you back to the stock that started this thread -GTG. After some days of algorithmic trading we see today's very high volume stop raid - 964,140 compared with a daily average of 127,300.
The range was over 12% and the closing 35.5c was a miniparcel of 628 at 4.10pm. The final trade before 4.00pm. was 35c. which would have resulted in a red candle for the day.
I've had a very close look at GTG but for the life of me I cannot fathom what the Bot might be achieving?
The bulk of todays sales were nearer the high price for the day than the low price.
What happens if someone is using a Bot to Buy and at the same time someone else is using a Bot to Sell? Should be an interesting tussle or a stalemate?
Hailoh- You HAVE to be able to IDENTIFY if the robot is Buying or Selling. One thing we've missed here is mention of VWAP[volume weighted average price.Calc by dividing Dollars Transacted by Volume].This VWAP is Central to the Robot.
but to go to your specific,hailoh Assume it's robot Selling-Then this today was an example of Indicator doing "d'Fear". Now it's common wisdom that all Sellers are Bears,right?They sell at what they consider a Good/Best Price.Surely you'll concede that there is a Good Feeling when you Sell and then the price drops later,after ya Gone! With the Robot,particularly it's Mr/Ms Controller,well,hailoh THEY are trying to Dump/Drip their Shares for the Best Price and because we're dealing with Bulk Numbers For Big Bucks well,gee do you get d'PICTURE???
They can get Bored,They can get Desperate and it COULD come d'Day that they go....well,they,do d'Horse PatOOT,and hailoh,
it might not be a Stop loss/Kangaroo tail,RAID but could be well,hailoh It's getting in for a Beauty Short Position.BigBoy wants OUT.
mike you got 10k of shares and you're missing out by .5/1 cent?50/100 bucks out of 8grand? geez,50 lousy bucks and you risk being short filled Selling! was ya fadder an Auditor???
I would rather look at it this way...I've already dribbled 40,000 out at an extra half cent. That's $200 extra in my bank account and I'll take the risk with the last 10,288. Can't you tell from my name - I'm a Scotsman and a semi-professional gambler to boot!
Dug, I am amazed by some of your insights you show. Great stuff, I love your posts. I only wish I could understand your language better. However I get some pearls of wisdom from you, even after having traded somewhat successfully for about 8 years, I am still learning from your posts.
Well,eric,if a psychologist,can't fully understand my writing,that's a Good Point!! It's an adaption of Apache French and Pig Latin,it's how people talk down d'Valley.
Anyhow,better fill in the Buying drip by Alcorithmic.
It's not as Positive as the Negatives of the Sell.Buying can be Accumulating.All the time in the world for an Insto to drip Buy.Their motives are to buy at Market or Lower!!
At basic,Algae dripping is SAFE.They report to the client,they get paid to do it[dripping]so d'Criteria met is - "Over the Month we traded your shares the VWAP Price for the Month was X and We[they]We got Y[10/17.3%] better than that,so send the Fee of Z."
It's all in the TIME being allowed by the Client to Execute.
I'm pondering Angles for Using VWAP+Algae Trading;There's Money in a Full Understanding of Market Mechanisms.That's enough,but just a tip,of FUN daMetals.
Since I hold GTG I watched it yesterday and can recap the day's action.
The buyers at 0.35 were thinning the last few days. I had assumed the people who bought at 0.40 were gonna toss their shares out and some people who sold at 0.40 would be back to pick them up at 0.35.
It didn't happen. We had a 89,000 seller sitting at 0.355. We only had 100,000 at 0.34 and basically nothing at 0.35.
I look away for a second and some idiot tossed 200,000+ sell lot at market at 10:34am. He gobbled up everything between 0.345 and 0.33. There was a stop loss order sitting at 0.33 which got triggered and this drove the price to 0.32.
There was quiet and some buyers came in. The price went up to 0.33. Another 100,000+ lot was sold down to 0.32. The nervous people were gone and the price climbed on low volume.
You can feel there aren't many sellers out there but even fewer buyers which isn't a problem as long as the sellers wish to hold on.
Just asking a question: if you refer to the BOL thread you'll see there was algorithmic trading right up to a day before the big break. I noted that the chart was treading water - up to 4.17 then squashed back to 4.10 each day.
It is easy to theorise now that someone with a substantial holding in the know wanted to sell down without alerting the market, using multiple small 221 trades to keep the volatility going.
However do you or other forum watchers know of other examples where this trading pattern has resulted in a similar outcome? I'm not looking so much for a trading signal as a warning if it's encountered- declining TMF, confluence of all DMS and ADX indicators and also the trading pattern.
Heard something on ABC radio this morning about price manipulation. I was not really concentrating but I think there is going to be some sort of investigation. Not this stock specifically.
The news item was about the ASX detecting more insider trading activity than usual.
No big deal - I detect more than usual too.
Big Q: What are they going to do about it?
Bid A: Same as me! .... as usual! But they are the ones with the badge and the big stick - not me!
Bot trading is legal and MUST not be used for manipulative purposes under Rule 13.4 of the ASX Regulations. (Do a search of the ASX site and you will have a very enlightening afternoon's reading.)
If an "accidental" trade goes through which has the effect of manipulating the price, or the market, the trader is required to notify the ASX and give an undertaking that it will not occur again!
What a lot of Tommy rot!
The ASX does however prosecute several hundred cases a year of which the general public hears little.
The ASX has asked for help and co-operation from the general public in detecting cases of manipulation. They have given this address to send details of any complaints:
Please include figures, course of sales, screen shots, time of day etc to facilitate swift detection and prosecution if you lodge a notification of possible deviation from established trading patterns. (A euphemism for "complaint about insider activity.")
Rule 13 is actually quite a long regulation and covers much - particularly section 13.4
I posted links to it above on Thursday December 14th 2006.
Keep Smiling - Don't look back
Trading style: Chartist Artist _ Breakouts and Shakeouts.
hailoh, I don't fully go along with the theory that "Algae Trading" is some really negative Price Manipulation.Ingot and nightstalker paint it that way but I'm a bit doubtful.
Using BOL I just can't see how or why a Large Holder say "in d'Know" a few days before the Announcement would sell by drips and drabs and not be going into Bulk Lots,really hitting the market because They are under a Time Constraint,only some few days to Unload and THEY can't state "Well we got rid of a portion of our Holding but not the lot because our 200# parcels didn't do it.So we sold into the Panic yesterday at DUMP prices" Wouldn't be real Professional,hey?
No,I think Algae is for gentle re-weighting or for Signalling to other BigBoys that a bulk seller is here,Anyone want some Bulk? The indication of possible Trouble in Algae Selling is in Rising or Falling VWAP. If it[vwap]rises,then the Algae Seller who is using VWAP[which they all do]will increase his parcel size to get the higher than previously calculated price.This can then Nip the rise if the Buyers don't stay motivated. VWAP falling would also motivate a Algae Seller to Increase Lots to get thru the Huge Parcel at the best price especially if... i blather on too much.Think about it yourself,what percent margin of difference would move a Professional or an Insto to gear up his Algae in a time frame? Anyhow,philr has informed us on a pending Investigation,wonder if it's Algae or just pre Announce Moves they're Inquiring about?and are d'BigBoys shaking,all aquiver? Happy Trading.
tick [1] VWAP in the upcoming "Whata we Want" subscriber poll of additions to d'Value 4 $'s IC chart programme. VWAP is d'Tool of Professionals,TRUE!!
"No,I think Algae is for gentle re-weighting or for Signalling to other BigBoys that a bulk seller is here,Anyone want some Bulk? "
My research has shown that you are spot on with this remark. Many times I have seen some small parcels going through, all of a sudden a big parcel got sold.
The gentle reweighting is going on all the time, in the US more so then here. I recently read a book by Graiffer & Schumacher, Techniques of Tape Reading. He goes into this techniques (to watch out for) quite well.
eric, re "gentle reweighting" When algae was first noted,many dismissed it as Index Following Institutions simply fine tuning by selling say 221 shares,extremely benign and we who said it was "darker" than that were dismissed as raving lunatics. Of course when it[Algae]was spotted in NON Index Shares Mid Caps and below? well,then the character/nature of Algae was at least given a BigBoys vs d'Peasants[us] context. I think Algae shows how the BigBoys use psychology against us.Though THEY are dealing in large Volumes THEY are attempting to hide their intentions by drip feeding insignificant parcels by the minute into the Market.
Did you know,eric,that even two years ago the Non Premium Basic Commsec Pilgrim had NO Access to Full Depth or Course of Sales Data?Like it seems these poor punters only got XYZ is this price,then it's that with NO information of How Many sold.
Anyway,this book on Tape Watching you've read,eric,how about opening a thread in say Systems on Tape Watching and telling us about it? ohkoolnutz has expressed tape watching interest,and I go in for it as something to think about while screen watching so we may be able to get a real interesting thread going on it.
hope to see it,if/when ya feel like it,eric. cheers, jr
tick [1] VWAP in the upcoming "Whata we Want" subscriber poll of additions to d'Value 4 $'s IC chart programme. VWAP is d'Tool of Professionals,TRUE!!
Dug, I shall give that thread some thought. However, tape watching of course still exists today. What do you think we are watching when we watch live charts? The ticker tape of course. Only today we get it in graphics. Much easier to watch and to understand
Perhaps he's pulling our legs, But its interesting to listen to Jim Cramer talking about hedge fund and price manipulation. Of course he's talking about the US here
That was a good laugh, Smallworld, believe every word of it too. You know that there are hedge funds that are depending on the continuing fallout from the sub prime mortgage loan market to boost their turnover! Unless laws are changed, people will flout them.
I didn't re-read this thread but I've been onto Algorithmic Trading since CBH was 30centsish back in 2005,back when None had even heard of this Method.
Ohh I got all this flak from clever richards saying I was delusional,on drugs or off in Fantasy World.
Senior Members deigned to point out to me that these small parcel trades were merely Re-Weighting by Respectable Index Funds.When I replied "How come this trading was happening in shares not included in even the All Ords?" THEY just sniffed at me and intimated I shouldn't be looking at bleeding Micro Caps in the First Place.
Even up to last year Clown Clod still didn't get what the Algae was in his shares. He thought I I was babbling,a Conspiracy Theorist basing my ideas on the Bloody Open/Close Auction small bids.He even thought it was all explainable by HouseKeeping/Pensioner/Soc Sec beneficiaries Buying their tiddly "Gambles" to supplement their Income or some such Superior Jib.
This piffle of course took NO ACCOUNT of Multiple Parcels being bought for less than $500[the minimal retail parcel]but Clown Clod don't use Market Depth Watching,he uses 1/15 minute intra-day charts that HIDES the process of Algorithmic Trading.
Now all the Links mentioned above are usually to do with the Yankee Market and their use of Algorithmic Trading to basically do Arbitrage in a highly Fluid enviroment. If you write to the ASX about Algae in your share and tell 'em "Something should be DONE" like Crusader for the Righteous Ingot54 has often,well,the ASX sends back this Form Letter that has privacy provisos of For Your Eyes only,NOT for Publication Jazz in it while they patronisingly tell the pilgrim that
Algorithmic Trading is a Fabulous Thing done by Proper,Decent,Respectable Big Money Institutions so as to decrease Volatility and if you are a retail/mum'ndad/a mere Pilgrim to Mammon then you should rest easy at night cos d'ASX has ya best interests in mind.
I have yet to read a single article by the likes of Alan "Koka" Kohler pointing out any ANY problems with Algorithmic,Robot,Computer Generated,Algae Trading. So Live2Air,exclusively for Incredible,Live2Air for FREE I invite any and all opinions,observations to be here.
Please can any Links,Articles be specific to the Australian Market ONLY.
Algae can best be spotted in relatively small turnover shares not the 100k's,multi transaction per minute Top 50ers say. In Mid Caps and below the ONLY trading can be Algae on a day or a session.It is extremely obvious when Depth Bid/Asks get cluttered up with multi small Buy/Sells,out for all to see on the Line.
I've observed that currently Algae can be "hidden" in Multi say around $3000-$5000 Transactions.That is that BigMoney is riding under the cloak of the above mentioned SS recipient,small time,little fish,prats.
One best observes Algae by Depth Watching and checking the Course of Sales # transacted on a Buy or Sell.There is a new "trick" now of immediately transacting a larger transaction OPPOSITE to the Algae so as to,I think,confound Intra Day Charts.Minute charts also form a line based on multi Algae combining to form a Volume to the "tick".
Algae Trading is also being copied by those who have Fixed Fee for a Period Brokerage Platinum Grade etc.These,too,can be a factor to watch out for in Depth Analysis/Pondering.Often against the run of action a "Flicker" a small buy sell against the Run of Play will occur.Especially when a bit of time,say 15 minutes plus,has passed with No Transactions.
Platinums though do not mimic Full Blown Algae too well because they don't do the multi small trades day after day,even weeks that a Robot does.
Now I don't know this for sure but I assume that 1/5/15 minute charts are universal,like everyone's is the same,all working to the same tick of the Clock.Is that the way it is?or can canny,clever professional traders adjust the timing?
If this self adjustment is not possible Or not done because it puts you out of step with what other traders are doing etc etc blah? well right there is how the Algae can fool you,by changing the move with a minimum expenditure ie a Red Candle for 14 minutes can be turned Green by a single bit of Algae. In some circumstances of course.{Spread wide shares for the cognizcenti]
The biggest problems that the Algae Device causes is to Short Term Traders.Day Traders are frustrated by it's Dampening Effect on Volatility.Novices can be beguiled by the small parcels.Old Goats can remember the days of Uboats past as the method of choice by BigBoys.
Algae just all round BORES the Market,starves the action and if you're a Day Trader after Fast Bucks? well avoid shares with Blooming Algae or otherwise get back onto your Attention Disorder pills!!
Now,the other Move/Manipulation that often goes with Algae is the False Big Bid or Ask just off the coal face of Depth Action. but I'm due for Knock Off Time so...later.
Gee dug,I just learn't more reading the latest half of this thread than I could have hoped to have learn't on that other thread.I noticed you mentioned conspiracy theories,though I can see how this sort of fixing could benefit large players.Thanks for the support on the ignorance of others recently.Maybe I need to read between the lines to gain any usable information before the fact,not after.I suppose it would ruin the "mystique"if others gave away all their secrets.Watching the ASX over the last 6 weeks has been a pretty fast learning curve.Cheers and here's hoping for an upward turn.
Greetings azworkinit, It's a bit difficult getting a response out of anyone on this Forum at the moment.Especially of wide,open ended Queries like in your first post. Geez Fortesque,Sally,a half dozen Iron Ore Going to bees +Smy combined with Thunderrax [whatever] wrapped up in a general query "I'm new to this so tell me about Resources" Little wonder,hey? Where can one start!!
So firstly you have to get off time delay.This process will be quicker if you Fill Out EVERY Question in your profile Including Address and Telephone Number.See Colin Twigg is trying to save us from Rampers.So he requires your Bona Fides to be established.Be Assured he don't sell your Details to those Dating Service mobs etc. so these and Nigerians can get on to ya,ok?
So once you're off time delay,you can try asking questions to get some answers.In the meantime try and absorb Colin's Views by reading all those stories listed on the Left Side of the Topics Page. Now IC is predominately a Charting/Technical Analysis Site.TA brings with it all this stuff about Money Management -Stop Loss,Parcel Sizing. Basically one reads the Chart and doesn't apply Fundamental Analysis too stringently.ie your reading of WhiteCliffs Coal Presentation gives you no reason as to Why the share fell subsequently.So What? Who Cares? The Price Fell and that's all you have to KNOW.Falls too far,Hits your Stop Loss? You sell. Simple,hey? Such matters have 1000's of posts existing,already.So you can browze these to you're ready to ask some specific Question or something don't work/be understandable to you.
Other than these starter points,may I suggest you try posting anywhere other than the very Top of the Board here in Markets? azworkinit is that "patois" for I is working on it? Open a thread in General with your answer + Why/Where?What you're expecting from the ShareMarket etc blah.Like I looked up your occupation in your profile,Why aren't you at least checking out that Sector that you may know something about?
Whoa this thread is coming alive again - with this post it'll be three for the day!
There is another potential use of the drip trade - and that is for scalping. A lot of little parcels bought/sold with a pre-defined buy/sell area which are closed only ticks away. Based on what I've watched I don't think this is the general use of it, but I think it probably happens as well.
But on to exploitations... is there an indicator that takes into account whether more trades are placed by buying into the ask versus selling into the bid? Most indicators looking at money flow look at where the stocks opens and closes - but not specifically if people are buying or selling.
For example a price could actually go down with many people buying into the ask. Is this less bearish than price going down due selling into the bid? I would think a little yes. Of course it would be easier to tell by using such an indicator to look at the past and see if there are correlations.
Making such an indicator would require some serious data though - course of sales wouldn't do it. However I'd wager some of the big boys have looked into and use precisely that. To my thinking if "buying into ask" volume > "selling into bid" volume it is more bullish. Just like other indicators divergences might give warnings.
And onto VWAP. Dug I know this is a point for you. Does anyone know where we can get historical VWAP data? I can get it back several months for any stock. But you'd want the lifetime of the stock ideally. Surely it would be easy enough to write a program to grab the daily VWAP for charting (from now on). There are indicators that approximate it that I know of - Typical Price and Weighted Close in IC do just that.
I think using VWAP should give a more true representation of what the market thinks, however the difference between that and "normal" price is generally insignificant and unlikely to make a trader considerably profitable. However it could be very handy on days that show very big ranges - shows what people (and bots) were really willing to buy and sell at.
On some of your points- Algae scalping :- This can sometimes be seen as Capping.Where a Number of buys are made 3/7%"down" and then a Ask of a "larger" number hits the Board.Usually the ASK is of course Less in Number than has been accumulated by Algae Bid. One sees this phenomena in some Substantial Holder Notices by Citicorp,Morgan Stanley etc.When a full disclosure Sub Note is put,that is. You see in the Accumulation reported the Trades on What Day,for how long raised this Change in Holding.Often you will see say bought 20K sold 8k on the Very Same Day in such Substantial Holder Notices.
Re VWAP :- You have access to several months of VWAP figures?? Where and more importantly in What Form?
See it's not much use having only the Daily calculated Figure.It's not like Closing Price Moving Average Calculation.One has to Add each days Total $ Transacted and divide that by Total Volume over time you're looking at.Do ya follow?
One does not add up 3 days single VWAP and divide by 3 to get an Average VWAP.
I don't think Historical VWAP over years would be all that useful.VWAP,to me,is DYNAMIC.Some AVERAGE calculated over the Long Term would have no relevance,I reckon,to THEY who use VWAP professionally.
Not only is VWAP useful in a Wide Price Ranging Day.It's also Handy when looking at Wide Ranging VOLUME days over,say,a week.
You have to realise with both Algae and VWAP Big Time Users that they can simply shut up shop,Stop and Leave the Market. An order has been placed to Buy/Sell an amount at/below/above VWAP and when it's completed? It's Over.The Depth is no longer being "manipulated".
So we know now that Algorithmic Trading is a FACT.The ASX has announced it as so and debunked any thinking that Algo/Algae is some blessed Conspiracy that should be Ignored or Dismissed as NOT Happening. The ASX has it[Algae] is Actually a Good Thing or at least Lawful mainly because Big Institutions do it so it must be beyond Reproach.They Say.
So Algae is Here to Stay.It has replaced the UBoats of yore. Whereas Uboats were Big undisclosed Orders that set up an Apparent Overhang before your beady eyes on the Market Depth Bid/Ask,we now have twiddley $50 and up algae whittling either Bid or Ask and sometimes both at the same time!! Because they're small BigHeads don't see them as "Significant" whereas confronted by Uboats these Old Men of d'Sea had plenty of explanations/moves that they could pull for their Deification as Hot Shots!!Legends of their own mind and Say So!!
Algorithmic Trading has Shaken all the Past Folk Lore/Myths on it's head.One has to come up with some Viable Strategies in the Face of It when it comes to a share you're on.If ya don't?Continue to Hold that Algae is Irrelevant?well,ya gunner get Buried a Loser.Get hit by the Thousand Cuts instead of being torpedoed/warned/Heads Uppped by the old time UBoat.
I've got some more Maybees/Could it be That/Drawn conclusions/perhapsers/ found Indicates on Algae Trading.
I have noticed another play that seems to be happening at the moment, and it's fast, so I suspect it is computerised. The volumes are sometimes low so whoever is doing it must have minimal brokerage.
It happens in smaller illiquid stocks with decent spreads. On the cross at the open, all asks above a reasonable sized bid on the other side are cleaned up right at the auction close, bar one. this sets the auction price at the level of the bid who has only scored one share. The shares cleaned up are immediately put back on the ask side at the top of the spread.
I guess the ploy is to get the poor guy who will be hit with full brokerage and paperwork for one share to cross the spread to make their transaction worthwhile.
Seems like a hard way to make a buck, but they are damn annoying
That what you have described,resillent is more an Actual Manipulation,the topic heading. Long ago when we actually got posts on Shares and the Mechanics of the Market,it was said that small,illiquid shares such as this had Market Maker action happening. Two related entities bought and sold between themselves waiting for Fresh Meat/New Blood to take a position in their "controlled" share.There was talk of Pattern Set Ups by these that explained False Breaks/Failures.Things like Bear/Bull Traps being "conspired" especially only in Penny shares by "insiders". This type of discussion was closed down by Know It Alls coming the Insult and Poo Poo.To me this Ganging Up on proposers of Conspiracy confirmed that it COULD Be Happening!! but I'm a ratbag like that.
Anyhow,the Definition of Algae is Multi,Hour upon Hour,Day into Week small parcel Trading. One off,couple of times a day small parcel moves is NOT BigBoy Algae but Small Minded Self Obsessed Prats thinking they can Move the Market because,well they think they are soooo Great and Tricky.
It is not at all unusual for small parcels to figure in the Open and Closing Auctions.Neither is it Unusual for Big or Small Parcels to "Flicker" these Auctions and of course the fastest fingers on real time not refreshed get to Win. This small time/minded diddling is why I reckon the CLOSING Price is now Irrelevant.The Close is NOT set by Professionals now that every two bit Trader can get in on it thru Live2Air Market Depth. The Close is d'Fancy Boy Price Setting NOT Professional.IMHO. and the Open?well that's another matter.
Well I'm probably the last person to try and get Clarity from but I reckon it goes like this.
Are the actions by "BigBoys" significant? Is their Buying or Selling in a Share an Indicator of Smart Money Flow? Do Institutions have access to more details/information about a share than us?
Assuming YES and Algae is the Method of Institutions and Other BigBoys,one must ponder on it or stay in the Dark.
Now Algae can meet the Bid[be Selling} or take the Ask[be Buying]. It can also do both things at the same time!! When this both buying and selling occurs I have observed it's because trading has widened more than one tick above/below VWAP.
It is Known a Cast Iron True FACT that Algae is programmed using VWAP.If ya don't know what the bleeding hell VWAP is?Go ask Chuckles!!
However when the Algae is Selling,it will follow down the VWAP usually.Some Bid Level taken out and the Algae simply takes bits out of the next lower bid. In contrast Algae Buying can turn off biting a Higher than VWAP ASK and turn into algae Selling for arbitrage purposes or just back off til the VWAP becomes the Ask.
I reckon that when you observe Algae Selling you should back off.Certainly not Initially Buy in the Face of this FACT and perhaps give up one's Hold from lower prices.
I think this because the Seller may so decline the share price/the VWAP that it [d'Seller} gets "Twitchy",starts escalating it's Sell price Parcels that hit the Bid. Why? Simply because the buyers are hesitant even with the price falling so the Seller is not getting his "orderly "distribution by the Algae Method.
If in fact the Algae has been turned on because of "inside" information privy only to the Institution? Well a Time Factor can come into play.The Algae knows what when some info will be released and is trying to dispose at best prices.
Now you'd be a complete dill to think this "reasoning" is Predominately the "Vision" you get on seeing Algae Selling.
Lots of other normal and Above Board Actions happening with d'Algae Selling but yeah BUT you would be just as much of a Dill to not see Algae Selling as a sure fire if not possible Indicator that in the Short Term your Share is at a Peak and highly probable to be retraced/go down from the price of First Day Observance VWAP. Further it don't matter what ya Blessed Chart says.You've been Trumped by a BigBoy Fact of floating Algae. Get over it if not used to it.
I am with Comsec also but have no complaints if you push the Torpedo button and aim directly at the seller
The only time I don't get satisfied is when I elect to join the Queue and show my cards in some greedy attempt/wishfull thinking in the hope of saving a few pennies
I have found that this Technique/Tactic is not a good idea in any form of sports wagering
Salute and Gods' speed
The algae trades IMHO are a NONSENSE
In True Course of Sale Point and Figure charting Only the first trade price is plotted The rest at the same price are totally ignored
As there is always a buyer and seller for each Volume traded Volume therefore becomes MEANINGLESS
It is the change in price that is MEANINGFUL
"While we stop and think, we often miss our opportunity." Publilius Syrus, 1st century B.C.
"I believe the future is only the past again, entered through another gate." Sir Arthur Wing Pinero 1893
"There are two times in a man's life when he should not speculate: When he can't afford it, and when he can." Mark Twain, 1897
The playing around on auctions mentioned above has caught me out when I’ve tried to be too clever. Done over by a better player, I can live with that.
But if you’re referring to my whinge down in the general section, than don’t try defending Comsec on me today.
I’m quite partial to one big hit and that’s where they’re duding me.
This is a hypothetical of what is happening.
Say there’s a que of sellers - 20k at $1.00; 10k at $1.02; and 5k at $1.03
I lobe in a bid of 45k at $1.03 expecting to get the $1.00 and $1.02 and $1.03 ask leaving 10k more to attract at $1.03
Now the stock hasn’t transacted for hours.
My order gets vetted from the straight through and delayed for a couple of minutes. In that time “coincidentally” somebody else buys the 20k at $1.00 and 10k at $1.02 parcels and puts 30K back on the ask at $1.03. THEN my order gets released and I only get $1.03 fills. You can watch it happen and you have no chance to do anything about it.
So now I have to pick the orders off one by one and try to avoid paying extra brokerage.
I firmly believe that there are only 5 defining moments each week
How you approach the OPEN and then how the open defines YOU
I love trading the open (Refer to all 3 Incredulous Voyages)
I do all the hard yards while the Good for Nothing Landlubbers are asleep
They develop excuses only a mother would believe whilst I have NONE
BTW: The BEST exponent of tackling the OPEN was taught to me by Officer Smallworld over many dinners and drinks
I don't think it is my right to disclose his SECRET methodology without his permission
In essence my tack is to overbid t the open (within reason) and shock the contemplators into submission
The Real Good Ones never come back and those are the ONES I really want
Salute and Gods' speed
PS Officer Resilient ONE In your example above I would have placed a Limit order in @ 1.10 and allow a few seconds for the Alphabetic countdown through the Opening Auction
(Message edited by Captain_Chaza on May 14, 2008)
"While we stop and think, we often miss our opportunity." Publilius Syrus, 1st century B.C.
"I believe the future is only the past again, entered through another gate." Sir Arthur Wing Pinero 1893
"There are two times in a man's life when he should not speculate: When he can't afford it, and when he can." Mark Twain, 1897
Please allow me, to tell you some words about MANIPULATION too:
1) MARKETS ARE NOT MARKETS ANYMORE. THE PRICE EVOLUTION IS NOT THE RESULT OF THE CONTINUOUS CONFRONTATION=NEGOCIATION=AUCTION BETWEEN ASK AND OFFER ANYMORE, BUT ONLY A RESULT OF THE MARKET MAKER`S ABUSE=FORCE:
" Take it (the price and/or quantity like it is), or leave it ";
2) MARKET EVOLUTIONS ARE BECOMING CASINOS=LOTTERIES=GAMBLING EVOLUTIONS, CONDUCTED BY MARKET MAKERS,
WHO ARE BUILDING THEIR STRATEGIES - DECISIONS TO BE TAKEN IN TIME AGAINST THE "MARKET" - WITH THE HELP OF ALGORITHMS=ROBOTS, WHO ARE MINIMIZING THE CHANCE IN TIME FOR MAKING A WIN FROM TRADING ACTIVITIES (making such chances=probabilties VERY SURPRISING=LIKE ACCIDENTS=RARE EVENTS) AND MAXIMIZING THE CHANCE IN TIME FOR A LOSS, WITH THE REASON TO BLOCK IN THEIR OWN ADVANTAGE ANY FINANCIAL RESOURCES CAPTURED FROM THE GAMBLERS=PLAYERS, that we can call anymore:
I have had similar things happen, but you can cancel your order so you don't take the 1.03's above, and get on the phone. I have a VIP number due to my level of transactions and have got compensation previously when conditional orders have not fired.
well from what i can sort out from your post Stoian , yeah
but that really is old, if not ancient news has been since for around the last 20 or so years -- just that now it is becoming more obviouse . like they are using TA against the everyday trader -- had to happen sooner or latter .
cheers
The "Sea of Uncertainty" is defeated by the nimble vessel "Probability", not the unwieldy vessel "Prediction".
Most of this has only very minor impact on making money.
Tiny details really.
A share moves up or down over a time frame, and you go long or short. Does all this "manipulation" make those moves shorter? Maybe... but certainly still tradeable.
Does this "manipulation" affect every traded security? I'm going to say NO.
Surely common sense would tell you that manipulation can not stop true "value" eventually appearing. Whatever "value" is. If more people (as in more money) think company XYZ is worth $1.00 than those who think it is worth $0.50 it will move towards $1.00. Get on their side.
On the way up maybe someone sneaks orders ahead of the queue, maybe someone drip feeds a massive sell in, maybe a super robot places trades in some fancy way designed to rip you off 0.5% because of some statistical anomaly in the average punter's habit they can exploit, maybe some big boy straddles buys/sells to arbitrage the depth... You can still have a nice profitable trade.
OR you can just find a share that doesn't exhibit all of this stuff and trade that.
Or you could be the queue jumper yourself - but really we're talking one price step and most trades aren't dependant on one price step to work. (However some do and that's a valid strategy too)
So can prices be manipulated to stay in a certain range? Probably... then play the range.
So can price be manipulated to be UN-tradeable profitably? I really don't think so. Even if you could make a share price behave randomly you'd still be opening yourself up for a loss. You'd need to KNOW in advance how every participant will react to prices... but then you may as well just trade it, not manipulate it! Manipulation at best cushions movements... but that is still movement.
Let's say someone did manage to make something UN-tradeable anyway - you'd see it was too random to trade before entering... or you'd get burnt a few times and move on to something else, forfeiting a couple of percent of your account for the experience.
I have focused on manipulations in the past for brief periods, however it only feeds a belief that trading is difficult. I think it IS worth investigating because these phenomena can be exploited or used as warnings or whatever... but it is a very minor consideration compared to say a share breaking out of a tight range on high volume.
Remember, we as private traders all have the biggest advantage you can get which is smaller positions. That far outweighs < 1% slippage from potential manipulations... and the very manipulations could actually end up making your profits greater! If you're trading say < $0.20 or even < $1.00 stocks then use the tricks yourself to sneak in a price step better. If your positions are too big to do that then you need a bigger market or you need to accept a slightly lower % return.
I guarantee all of us have been on the end of a trade that has either been more profitable than it "should" have been or we got off more lightly than we "should" have because of what seemed like funny business in the price... one might dare say someone was MANIPULATING it! It's two way traffic and sometimes we benefit.
I didn't give you the stars,mr lunch but it was a very good post. I've other points to make about the small parcel trade as Negative. It can be used to distort Intra Day One Minute/whatever Tick charts.Volume of a single tick can be "turned" into an Opposite Signal. I find that the use of Algae is most detrimental/manipulative in Small Stocks.It's use/method was developed for the US Market in high liquidity,numerous transactions per minute if not seconds shares.It is probably used "legitimately" here in BHP maybe but in small shares it has a definite effect of cooling down/ceasing Momentum. In contrast to private/"retail" traders and their "flickering" tricks,Algae is Relentless.It can dominate the Trading for Weeks not just "annoy" or give "False" signals to the Gullible at the Open/Close Auction.
Anyway,I've said enough about this small Mechanism in our Current Market Now. cheers.
This is not ACCUMULATION How can <$3500 in a day generate in your mind ACCUMULATION?
I think a petition needs to be drawn and and these sort of Share trading habits should be OUTLAWED
It does nobody any good INCLUDING the ASX itself
I believe that this sort of INSIDER /OUTSIDER Discounts-no brokerage fees only have a sinister note and I am prepared to #1 Ban The share that the ASX allows to trade in this despicable fashion
#2 Ban doing any business with any share the ASX has anything to do with!
In this Global Exchange and as is the Case in ALL BUSINESS
The Head always rots from the top down!
Let the Forums of this world Voice their utter disgust, distaste and spread the word throughout all the forums discussing any Shares allowed to operate in this fashion on our once beloved ASX !
Salute and Gods' speed
"While we stop and think, we often miss our opportunity." Publilius Syrus, 1st century B.C.
"I believe the future is only the past again, entered through another gate." Sir Arthur Wing Pinero 1893
"There are two times in a man's life when he should not speculate: When he can't afford it, and when he can." Mark Twain, 1897
