Volume Spikes Continued

 MetaStock SPRS Series - Week 129 - TechniTrader® Stock Discussion for MetaStock Users - Volume Spikes Continued - July 26, 2013 By: Martha Stokes C.M.T.  High Frequency Traders create most of the "Volume Spikes" that form on your charts nowadays. This is due to their high speed, low latency trading platforms that execute as many as 3000 trades per second. This is way beyond the scope of retail trader's minute trading platforms.HFTs can control price for one day, and sometimes for 2 days. Their volume patterns are easy to identify on the charts and can give you a leading indication of what to expect the next day.If you are a swing trader, learning these patterns is crucial for your success. If you do not understand whether the HFT volume is a continuation or a reversal pattern, and why it is a continuation or reversal pattern then you are most likely to find yourself on the wrong side of the trade most of the time.Studying the chart above with colored volume to indicate an upside price day versus a downside price day, it is easy to pick out the HFT volume days when the HFT trigger orders are moving price and volume.Remember that not every HFT buy or sell is profitable for them. This is a computer generated high frequency order system. The computer is far from infallible.The first HFT action is out of a bottom. Smaller funds and retail traders who use share lots above 5000-10,000 lot size are trying to sell down this stock. TechniTrader® Quiet Accumulation TTQA shows this smaller fund and large lot selling effort. However Dark Pools are moving in at this level so price holds steady. HFTS discover the Dark Pools and trigger a gap up day on higher volume. As the Dark Pools shift the sentiment to the upside, seen by the red to green TTQA in December, the HFTS once again trigger causing price to move up again.When HFTS are tracking Dark Pools the trend continues.As the Dark Pools activity evaporates smaller funds and HFTs are driving price. Dark Pools have stopped buying. When HFTs discover this they start selling short, triggering the smaller funds and retail side to chase on the sell side, either selling out of a losing trade or trying to sell short.However, the Dark Pools are NOT selling, distributing, or rotating. They simply stopped buying because price moved out of their buy zone. So as the price enters their buy zone, the Dark Pool orders start firing off again and this forms the bottom.HFTs once again discover this, driving price up again for one day end of April. Since Dark Pools are still in the buy mode price moves up slightly in May. HFTs try to drive price up further but fail at the end of May. So the HFTS switch tactics and try to sell short, unfortunately for the HFT computers which are not able to see what you can see in your charts, the Dark Pools are triggered just as the HFTs try selling short again based on their computer algorithms.Smaller funds chase the HFTs and lose money, because Dark Pools are consistently buying incrementally which now drives price.The final long volume and green TTQA is a result of HFTs triggering after the Dark Pools have completed their buying for the moment.The dynamics between the two largest and most dominant market participants in the market is important. By understanding how they move in and out of a stock and what patterns they create on the charts, you can learn to enter before the huge HFTs moves and avoid being on the wrong side of the trade.For more information email: info@technitrader.comMember of Market Technicians AssociationMaster Rated Technical Analyst: Decisions Unlimited, Inc. Instructor and Developer of TechniTrader® Stock Market Courses http://technitrader.com/MetaStock Partner ©2013 Decisions Unlimited, Inc. Disclaimer: All statements, whether expressed verbally or in writing are the opinions of TechniTrader, its instructors and or employees, and are not to be construed as anything more than an opinion. Student/subscribers are responsible for making their own choices and decisions regarding all purchases or sales of stocks or issues. At no time is any stock or issue on any list written or sent to a student/subscriber by TechniTrader and its employees to be construed as a recommendation to buy or sell any stock or issue. TechniTrader is not a broker or an investment advisor it is strictly an educational service.

HFT Price and Volume Patterns

 MetaStock SPRS Series - Week 130 - TechniTrader® Stock Discussion for MetaStock Users - HFT Price and Volume Patterns - August 2, 2013 By: Martha Stokes C.M.T.  We have been studying the High Frequency Trading price and volume patterns in the last few discussions. High Frequency Trading orders are triggered primarily on news during earnings season. These low latency high speed trading platforms often cause big gaps that seem to have no predictability.However when Relational Analysis™ is applied to the Price, Volume Bars, and TechniTrader Quiet Accumulation TTQA then patterns are revealed, that are difficult or impossible to detect with just price and price indicators alone.If you were to just use price and price based indicators all you would see is a very choppy sideways pattern that whipsaws swing and momentum traders frequently causing losses on trades. MACD is a price momentum indicator that fails dismally when charts have this new type of sideways pattern called a "Platform." The platform is a very specific type of sideways pattern that first started forming in 2005 and has become increasingly more common as more and more giant and large funds use Dark Pool ATS.To be able to anticipate what price is going to do and when it is most likely to trigger HFT orders that run and gap hugely, it is imperative that volume and quiet accumulation indicators be used.What volume and TTQA show is that there was quiet accumulation going on in this stock that created the Platform sideways pattern. HFTs gapped the stock up as the Dark Pool quiet accumulation ceased and smaller funds chased the HFTs. During the next platform Dark Pools returned quietly adding to their holdings. Several attempts to sell the stock down created a flurry of smaller funds dumping this stock. Notice how TTQA diverges from volume and that most of the Volume is green during the red TTQA period. This exposes Dark Pools buying once again. Subsequently the sell down fails because the giant funds are buying, while smaller lots are trying to sell short against the huge lot buy orders. The compression pattern just prior to the gap up, along with the fading TTQA angling up, and lack of sell side volume all point to HFT trigger opportunity.The stock gaps as HFTs automated orders react to the Dark Pool buying earlier.Being on the right side of the trade requires that you not only use price indicators but that you also use volume indicators, that not only show volume action but also large lot versus small lot activity.These indicators are more sophisticated as they are the new TechniTrader® Hybrid Indicators™ but learning to use them will dramatically improve your trading results.For more information email: info@technitrader.comMember of Market Technicians AssociationMaster Rated Technical Analyst: Decisions Unlimited, Inc. Instructor and Developer of TechniTrader® Stock Market Courses http://technitrader.com/MetaStock Partner ©2013 Decisions Unlimited, Inc. Disclaimer: All statements, whether expressed verbally or in writing are the opinions of TechniTrader, its instructors and or employees, and are not to be construed as anything more than an opinion. Student/subscribers are responsible for making their own choices and decisions regarding all purchases or sales of stocks or issues. At no time is any stock or issue on any list written or sent to a student/subscriber by TechniTrader and its employees to be construed as a recommendation to buy or sell any stock or issue. TechniTrader is not a broker or an investment advisor it is strictly an educational service.

HFT Price and Volume Patterns

a MetaStock SPRS Series - Week 130 - TechniTrader® Stock Discussion for MetaStock Users - HFT Price and Volume Patterns - August 2, 2013 By: Martha Stokes C.M.T.  We have been studying the High Frequency Trading price and volume patterns in the last few discussions. High Frequency Trading orders are triggered primarily on news during earnings season. These low latency high speed trading platforms often cause big gaps that seem to have no predictability.However when Relational Analysis™ is applied to the Price, Volume Bars, and TechniTrader Quiet Accumulation TTQA then patterns are revealed, that are difficult or impossible to detect with just price and price indicators alone.If you were to just use price and price based indicators all you would see is a very choppy sideways pattern that whipsaws swing and momentum traders frequently causing losses on trades. MACD is a price momentum indicator that fails dismally when charts have this new type of sideways pattern called a "Platform." The platform is a very specific type of sideways pattern that first started forming in 2005 and has become increasingly more common as more and more giant and large funds use Dark Pool ATS.To be able to anticipate what price is going to do and when it is most likely to trigger HFT orders that run and gap hugely, it is imperative that volume and quiet accumulation indicators be used.What volume and TTQA show is that there was quiet accumulation going on in this stock that created the Platform sideways pattern. HFTs gapped the stock up as the Dark Pool quiet accumulation ceased and smaller funds chased the HFTs. During the next platform Dark Pools returned quietly adding to their holdings. Several attempts to sell the stock down created a flurry of smaller funds dumping this stock. Notice how TTQA diverges from volume and that most of the Volume is green during the red TTQA period. This exposes Dark Pools buying once again. Subsequently the sell down fails because the giant funds are buying, while smaller lots are trying to sell short against the huge lot buy orders. The compression pattern just prior to the gap up, along with the fading TTQA angling up, and lack of sell side volume all point to HFT trigger opportunity.The stock gaps as HFTs automated orders react to the Dark Pool buying earlier.Being on the right side of the trade requires that you not only use price indicators but that you also use volume indicators, that not only show volume action but also large lot versus small lot activity.These indicators are more sophisticated as they are the new TechniTrader® Hybrid Indicators™ but learning to use them will dramatically improve your trading results.For more information email: info@technitrader.comMember of Market Technicians AssociationMaster Rated Technical Analyst: Decisions Unlimited, Inc. Instructor and Developer of TechniTrader® Stock Market Courses http://technitrader.com/MetaStock Partner ©2013 Decisions Unlimited, Inc. Disclaimer: All statements, whether expressed verbally or in writing are the opinions of TechniTrader, its instructors and or employees, and are not to be construed as anything more than an opinion. Student/subscribers are responsible for making their own choices and decisions regarding all purchases or sales of stocks or issues. At no time is any stock or issue on any list written or sent to a student/subscriber by TechniTrader and its employees to be construed as a recommendation to buy or sell any stock or issue. TechniTrader is not a broker or an investment advisor it is strictly an educational service.

Volume Spikes Continued

aMetaStock SPRS Series - Week 129 - TechniTrader® Stock Discussion for MetaStock Users - Volume Spikes Continued - July 26, 2013 By: Martha Stokes C.M.T.  High Frequency Traders create most of the "Volume Spikes" that form on your charts nowadays. This is due to their high speed, low latency trading platforms that execute as many as 3000 trades per second. This is way beyond the scope of retail trader's minute trading platforms.HFTs can control price for one day, and sometimes for 2 days. Their volume patterns are easy to identify on the charts and can give you a leading indication of what to expect the next day.If you are a swing trader, learning these patterns is crucial for your success. If you do not understand whether the HFT volume is a continuation or a reversal pattern, and why it is a continuation or reversal pattern then you are most likely to find yourself on the wrong side of the trade most of the time.Studying the chart above with colored volume to indicate an upside price day versus a downside price day, it is easy to pick out the HFT volume days when the HFT trigger orders are moving price and volume.Remember that not every HFT buy or sell is profitable for them. This is a computer generated high frequency order system. The computer is far from infallible.The first HFT action is out of a bottom. Smaller funds and retail traders who use share lots above 5000-10,000 lot size are trying to sell down this stock. TechniTrader® Quiet Accumulation TTQA shows this smaller fund and large lot selling effort. However Dark Pools are moving in at this level so price holds steady. HFTS discover the Dark Pools and trigger a gap up day on higher volume. As the Dark Pools shift the sentiment to the upside, seen by the red to green TTQA in December, the HFTS once again trigger causing price to move up again.When HFTS are tracking Dark Pools the trend continues.As the Dark Pools activity evaporates smaller funds and HFTs are driving price. Dark Pools have stopped buying. When HFTs discover this they start selling short, triggering the smaller funds and retail side to chase on the sell side, either selling out of a losing trade or trying to sell short.However, the Dark Pools are NOT selling, distributing, or rotating. They simply stopped buying because price moved out of their buy zone. So as the price enters their buy zone, the Dark Pool orders start firing off again and this forms the bottom.HFTs once again discover this, driving price up again for one day end of April. Since Dark Pools are still in the buy mode price moves up slightly in May. HFTs try to drive price up further but fail at the end of May. So the HFTS switch tactics and try to sell short, unfortunately for the HFT computers which are not able to see what you can see in your charts, the Dark Pools are triggered just as the HFTs try selling short again based on their computer algorithms.Smaller funds chase the HFTs and lose money, because Dark Pools are consistently buying incrementally which now drives price.The final long volume and green TTQA is a result of HFTs triggering after the Dark Pools have completed their buying for the moment.The dynamics between the two largest and most dominant market participants in the market is important. By understanding how they move in and out of a stock and what patterns they create on the charts, you can learn to enter before the huge HFTs moves and avoid being on the wrong side of the trade.For more information email: info@technitrader.comMember of Market Technicians AssociationMaster Rated Technical Analyst: Decisions Unlimited, Inc. Instructor and Developer of TechniTrader® Stock Market Courses http://technitrader.com/MetaStock Partner ©2013 Decisions Unlimited, Inc. Disclaimer: All statements, whether expressed verbally or in writing are the opinions of TechniTrader, its instructors and or employees, and are not to be construed as anything more than an opinion. Student/subscribers are responsible for making their own choices and decisions regarding all purchases or sales of stocks or issues. At no time is any stock or issue on any list written or sent to a student/subscriber by TechniTrader and its employees to be construed as a recommendation to buy or sell any stock or issue. TechniTrader is not a broker or an investment advisor it is strictly an educational service.