I had a coffee with a Trader (Global Markets Analyst) at Citi Bank recently, I spoke to him about the concept of stop-hunting and quote he said "...to an extent we look at the psychological levels, the other institutions are looking at those "technical levels" as places to find an entry point/target price..." I was surprised by this concept, I don't think day traders are hunted, rather they are often found where institutions are looking to enter/exit due to a mix of factors, I doubt liquidity is the only/main reason.
@@erics4127 retail stops ... no. Other institutional stops ... sometimes. Depends. Bigger participants (and traders who work for them) understand where other big participants are, or should be approximately, positioned. And sometimes you hit that and sometimes you don't. The way it was explained to me on a prop desk "Below a certain size market doesn't care at all. As you get bumped in size market starts to care because you, eventually, get to a size that moves said market". Right? Nobody cares about your 3 micros but get to a level where you trade 150 250 full contracts on DAX and suddenly everybody cares. The psychological levels are kinda just because it makes sense to look there for extra volume because big institutions need volume to execute the trade. You can't just buy 5k contracts on ES or CL without volume being there.
they dont but they care about where maximum or at least sufficient liquidity is to be found. this will often be at a prior swing high/low where there is sufficient opposing liquidity to fill a large order without moving price adversely for themselves
The only reason Jim Simmons hires 100 PhDs for his algorithms is because he manages larger funds and could not afford very large losses or declines. It's simply that. The retail trader can operate running with 50% down, he can afford that risk. Jim Simmons, who manages hundreds of millions, could not run his operations with a drawdown of 50% of the billion. It's a question of how much you have at risk and that is what makes the difference between a more complex method and a simpler one. If Jim Simmons could afford to trade for example 50% down, the technical analysis would work.
@@pepesdi584 I dont think you understand what random means in this context. Price isnt a random walk. It doesnt have constant variance. But it certainly is stochastic (random).
@@AnthonyBerlin He said in his video about technical analysis :"There's something called the BROWNIAN MOTION, it is a stochastic process which means in the short and medium terms prices are entirely random" I'm not here to back the chartists and no I'm not involved in the markets. but you can't profit from machine learning methods if the price follows a Brownian/Wiener process.
@@pepesdi584 Yeah, it's true that you wouldn't be able to profit from price if that was the case. But only an idiot would think prices can be modeled with only a Wiener process. Obviously you need a way more sophisticated stochastic differential equation than dW_t = N(0, sqrt(dt)) to model price changes.
@@pepesdi584 I went from making fun of TA people, calling it astrologist for men even as early as this January I think, to being completely sold on TA, at least parts of it. I joined a discord group, and saw day in and day out people make calls like SPY's going to $527, to fill a gap, then reverse back up probably. And I laughed as we were sitting at $534~, and goddamn, did it do exactly what he said it would. 6 months now i've seen how impressive these day traders are. They don't necessarily predict price action entirely. It's more like, if this happens, (X reaches this level), and makes this level a support, we should skyrocket to the next level. algo's can hide price action, which is true, but price action represents institutions trades. There are humans who put in orders first. Then disguised by algo market makers. If you understand the humans putting in the orders, you can make sense enough to get in line and skim the institutional orders. It randomly goes towards these liquidity spots, but once you know the spots (frequently called levels or support/resistance area's), you can make money.
@@zoro8117 They are thinking of statistics, which is TA. Coding Jesus just doesn't know what he's talking about and that there are a lot of people making consistent money daytrading, swingtrading, position trading, scalping. There are people that beat the all-powerful algos he works on, true scalping, joining bid/ask and exiting within seconds. He doesn't know statistics either, sadly, but I'm sure his IT skills are good.
Thats like saying a mathematician is the same as a Card reader because both use numbers. There is no statistichal proof of any TA techniques. Quants only use math in ways that have either theoretical proofs or have been tested statistically.
I don't think traders literally mean "they" are coming for my exact stop loss. But we understand "they" are aiming for retail money, and our stop losses tend to aggregate at certain levels
Hahaha. I tell people all the time that complain about stop loss hunting the same thing. Nobody cares! I'm a software engineer and been day trading for years. Understanding intraday market structure based on higher highs, lower lows, etc and average true range gave me the highest probability of wins. Most of my targets are twice of my stops. I only need to be right half the time to be profitable. However, my overall bias for the day is based on dealer gamma exposure. If you understand what the dealer might have to do to hedge their option positions then you can start to anticipate a possible move for the underlying. Note that many people out there use a naive approach to calculate the exposure, which is trash most of the time.
Wow Coding Jesus, you really do have a heart! That was probably the best post you’ve made clearing up misperceptions among day traders. You seemed to show some compassion, a first! You’ve really softened in your old age! Your usual approach towards day traders was often dripping in derision and bordering on hate. Despite all that I’ve been a longtime subscriber because I’m interested algotrading. I tip my hat to you! Sir!
Growing in this industrie sometimes is realizing that you spent a lot of time studying crap and useless stuff because it seems like a shorter road and it's easier, when you should have studied math, python, and markets theory
I’m a QR. I agree with most of what Coding Jesus says, but he’s wrong on this. It isn’t that Quant firms are chasing down individual retail traders, it’s that retail traders behave as a hive mind all acting off the same tweet or message board consensus, and subsets of quant trading strategies exploit the predictability of these trading patterns.
@@The.Harsh.Truths Maybe ive drank too much kool aid from my trading firm, but I don't think firms necessarily "target" retail antagonistically. JS entered a market with a lot of price inefficiencies (and a large retail population), and they simply started pricing things better. In fact you could argue this is good for trading participants who actually use those options to hedge (maybe worse for other participants who actively traded those instruments).
@@laggerlaggerson4375 right. I agree. The thing is, derivatives markets are zero sum, and fancy quant firms have backtested and discovered exploitable patterns to take the other side of. There are many market participants all arm wrestling in the market to eke out a profit. When the quant firm consistently comes out on top, somebody lost. That somebody is often the retail trader. The market moves in a way that may seem unfair and unusual to them, but that’s simply a result of smarter quant firms always pushing the market in the direction that makes them money. It isn’t always 1-to-1. Trading strategies are complex. How are ES future related to SPY ETF, and their corresponding options? The SPY order flow could just be a hedge to the options market where the real action is. The point being, it is a complex game with multiple big players, and the retail trader, if behaving somewhat predictably, is often exploited as a consequence. Not personally. Mostly as part of a large group that’s on the wrong side.
@@laggerlaggerson4375 also, our firm made record profits during the whole meme stock era with GME, etc. In that case, we were literally exploiting the dumb money buying and selling options on their small Robin Hood accounts. We were literally market making both sides and scalping all day for fat profits.
we absolutely used technical analysis at Two Sigma, e.g. ARIMA models. maybe some nonsensical functions might represent things like "cup and handle" patterns by some Fourier terms of seasonality and exogenous variables where the equations represent parabolic/linear curves, but if it passes backtesting/out of time series testing, model validation, risk analysis, etc. then it would absolutely be deployed in production.
@@huhuboss8274 according to who? as far as i understand it, any technique/method that uses market data is considered TA. so machine learning would be TA because it uses some form of price data in their models
This guy is a software engineer. He is not a quantitative researcher or trader, and is not whatsoever in a position to consider "going it alone". He has no direct involvement in designing any trading strategies.
Wrong. He’s a “Quant Dev”. So he is expected to fully understand the quant side in order to properly code up the dev side. I’m a QR but I work with QDs. They fully understand the models.
@@The.Harsh.Truths You can absolutely understand something presented to you without being able to come up with it yourself. He may be able to. All I am saying is that there is a difference between the skillsets of a quant dev and a quant researcher.
Technical analysis and machine learning are two different approaches to trading; they don't necessarily contradict each other. Machine learning usually allows for trading a very large number of instruments, aiming for a positive average return. Statistics only provide average and lagging data. A day trader, on the other hand, tries to make immediate and accurate decisions with a very limited number of instruments. They don’t care about averages. Just because your company or banks do not use technical analysis does not mean it is ineffective. The rules for managing large capital are also different. In my opinion, it’s a worthless video. Focus on your work; there’s no need to boast to anyone.
TA is innecfective. There are several studies that show 95% of people who use TA go broke in 1 year, almost all of the rest go broke in the next year. The hand full that dont make peanuts. Also, not caring about average returns is insane. If your average return is not positive, you are just gambling at a rigged game.
Ricky Gutierrez and other day traders claim that TA is a powerful tool and claim it takes time to build up the skills to trade profitability. What they forget is that luck is more powerful than skill in the market. Whoops...forgot they make the majority of their money from selling courses.
Hi Coding Jesus, I love the content! I would just like to add a bit push back- when working individually, does it necessarily have to be considered “competing”? Cant someone want to do something individually just to have something lucrative on the side of their 9-5? Also, in regards to education, are companies strictly accepting college graduates? And if so, are they selective on the type of college that students attended? I have no degree & I want to explore all alternatives of education before going massively into debt. Assuming there’s no way around getting into debt for an education. Thank you, Donald
Book recommendations Order Flow Trading for Fun and Profit, Daemon Goldsmith Evidence-based Technical Analysis, David Aronson 🙏 High Probability Trading Strategies, Robert Miner (limited* use)
I get it. It shouldn't be tried because it's too hard. Jeff Bezos should have never built Amazon either because that was hard. I shouldn't have spent 10 years studying for my CCIE. Maybe should have never made anything of myself at all.
I am crypto retail trader, and i dont do TA, i do trade execution with DOM and times and sales which is orderflow analysis , and i do Onchain Analysis...but i am still a gambler as long as trading is directional.
Not to mention, aren't stop losses not even visible on the public order book? It is my understanding that brokers hold stop orders and only convert them to market/limit once triggered (which then they are placed on the public order book).
thats how stops are supposed to work, technically. just an opposing order that enters the book when a certain condition is met. but your stop orders, if placed onto the platform isn't client sided, it's stored on your broker's servers. you can bet that this "data" at an aggregate level is being sold by brokers to their partners, the tier 1 liquidity providers, market makers etc. if oil traders are willing to pay drone pilots for thermal imagery of storage facilities in Cushing to get an idea of the reserves ahead of each Wednesday's EIA report, it's not unimaginable for big currency traders to do similar things to get an edge. In fact most brokerage agreements when you open an account will include something like this in their terms "Information Sharing BROKER XYZ has access to and may use and provide counterparties with client information, but will only do so on an anonymous and aggregated basis. This information may include but is not limited to, your orders, positions, trade and other data and analytics (collectively, “Anonymous and Aggregated Data”). This Anonymous and Aggregated Data may be used for market information, analytical tools, risk management strategies for market making and liquidity provision and other BROKER XYZ products and services. The nature of any Anonymous and Aggregated Data provided to a counterparty may differ from that provided to other counterparties in terms of quantity, scope, methodology or otherwise and may be changed from time to time without notice to you." so yes your data; including stops is available to them and their counterparties; but no they're not targeting anyone specifically, they just need to find liquidity.
Seems like writing code to automate trades based on data markers which have their basis in financial maths theory would be integral to quantitative trading. Because you’re just looking to have a huge volume of trades at a >51% odds of winning, then you can really multiply gains. Jim Simons also needed a huge team of maths people and coders to build the systems to capitalize on patterns in huge data sets.
While it’s true that professional quants have access to vast resources, the narrative that retail traders can’t compete algorithmically is overly pessimistic. Retail traders have access to quality data through APIs and financial platforms, and sometimes simplicity outperforms complexity. Niche markets often hold inefficiencies ripe for exploitation by agile, adaptable traders. Plus, communities and resources available to retail traders are extensive, fostering collective knowledge and innovation. The playing field might be uneven, but declaring it futile for retail traders to compete algorithmically is just lazy thinking. It’s all about leveraging the right tools and strategies!
We also don't have to worry about market impact of our trades. I can liquidate my entire position in an asset in a single order, which hedge funds can't do. Retail traders trading on the backs of institutional trades can be anywhere from almost as profitable to slightly more profitable. Ant on the back of an elephant. We can also take trades institutions can't. A couple of my best ETFs do
The human brain and screen time do the trick. Being green 30 days in a row would be 1 in a Billion if it was coinflipping but lots of traders have accomplished this feat.
My cousin made 400 bucks options "trading" (gambling) and I told him to just quit now he has absolutely no idea what he's doing. Lost it all. How the hell do you think you're going to consistently compete against math phds?
Don’t try to beat them just move along with them…there are tell tell signs of what way something will go which takes practice and lots of failure before you reach the success of a good retail trader
bro if you get a high quality predictive pipeline, at some point you will have a dataset of tens or even hundreds OF THOUSANDs of features of all kinds, ma's, ema's, complex aggregates etc. Out of that you will get to the inference models with about 1k-10k features after selection stages, statistical analysis etc. And somebody is telling me there's still people who can compete with these models based on what, 3-5-10 features? Just think about it. By the way i'm senior ml/research engineer in sports/finance for 4.5 years already and also recently worked as a quant researcher as well.
PHDs spent more time studying theory that doesnt work from people that cant trade. what makes them so smart? If they spent the same time and energy observing markets maybe theyd have an idea on how to trade. Either way doesnt matter, they play an important role in the market.
They understand theory in depth. Statistical theory. Martingale theory. In depth. All people do in "real life" is tweak it to their situation. But the phds made it. The knowledge gap between Joe schmoe and a PhD is bigger than you can imagine. Granted in a quant space someone with a bs in math could probably scrape by and learn enough on their own time to be competitive with a PhD. But a PhD still is usually very well rounded and just has thay depth you can't find in other places
What if you don't compete with the quant firms but simply use machine learning to find the most volatile segments of the market, enough to go up significantly over multiple years (albeit lose a lot during bear markets, the net result over 3+ years would be high).
Trading Jesus, can you address the concept of "edge". What edge are quant / prop firms exploiting? Is there any possible edge the humble individual trader can utilise? Or anything close to it. I think people here should be thinking about this rather than get agitated when you offend the "idols" theyve concocted in their brain
I make 3% on a day when nothing happens, 30 % on a good day; manual scalping. My FOUR attempts at replying to comments below detailing strategy, have been blocked by the moderator and deleted. Why? Astonishing.
@@damianpos8832 You watch and wait all day, until there is both volume and momentum, then you join in for a few seconds to several minutes. Do that 40 to 120 times a day. I use no more 15 % of capital per trade at a leverage of no more than 1:100, through high probability trades a win rate of over 80%. It may require several years practise. It’s easiest to have a friend or family member show one, and even then everyone has to find their own way, as not all are suited to scalping. It’s very full on. I have ADHD, I am lucky the hyper focus kicks in and time at the screens flies. I don’t have a need to talk about it. Opening a dialogue about trading to bright people who know nothing of the sphere, is likely to be met with rejection and a deaf ear. It’s a taboo subject for those who are uninitiated.
@@BCa00000 There are no draw downs of any relevance scalping high probability with momentum and volume, small position sizes, just joining in for a few seconds to several minutes. One is making just 0.075 of a % gain, 40 times a day, for 3 % total daily gain, for a few seconds to several minutes keeping a CFD position open. If 20 % to 40 % of one’s trades don’t work out by going in the right direction immediately or within several minutes, these losses are small to shut down and the day still profitable. It’s a huge psychological mind game plus fundamental and technical analysis. They say no more than 2 % who try to learn this have the right combination of intellect and psychological profile. It can take quite some time practicing, a year or two.
Hey Coding Jesus, hope you're doing well. Is day trading and trading in general a sum zero game? As far as I can tell it looks like so since for one to win another has to lose.
@gabriellinassi3382 not really but it certainly is if you base it on strategy. I backtested pretty much everything and it's always 50% at 1:1 minus fees. Discretionary trading is more about account management and position management than actual entries, most people will never get that but by algorithmic backtesting I just accepted that it was basically random so I use randomness to my advantage by cutting losses, running winners and hedging. I have 0 quant level skills besides coding so I only tested retail technical stuff... machine learning helped win rate but still I want to learn proper data analystics methods before bothering with quant/automation. Discretionary is kind of the opposite of what everyone thinks it is, you are compteting for the same setups with millions of other traders so you have to manage trades better than atleast 50% of them to win consitently.... it's not something to be taught only learned and I feel like it's a miracle i got there after about 5 years. And FYI manging trades and accounts isn't just risk reward etc... it's more of an art to be improved and it's really f ING hard and it never becomes easy... get comfortable being uncomfortable if you go down that path because if its not uncomfortable, you're doing it wrong.
my go to is instead of using TA indictors is to use the symbolic regression libraries along with the generic programing ones to "find" new indicators and then score them not on like percentage gain or loss but their entropy and then use a whole whack load of those in random forest ML to find out if tomorrow is going up or down for a stock and to only use stuff with a high confidence
Do you feed the model with price/volume or micro data like trades and the order book? Also do you use a fixed model for managing risk or also something ML driven?
@@taltalonix OHLCV data from like 5500 us companies and then i wasn't really sure what metrics to use so i just ran every test i could think of and eventually started seeing "indicators" that predict the sign of the next days percent gain or loss better than random like 51.6% instead of just 50/50 but you know if you collect 100 of those and they are uncorrelated and feed that into a random forest you can get some pretty good results. Killing the market with death from 1000 slight edges.
The stastistcal data quants use , isnt it based on historical price data? Do quants use any fundamentals? If so, how amd what and how is it fed into algorithmic Trading decisions?
Yeah they use any data... for example some big firms built camera systems on ports to count the number of trade ships and predict balance of trade. They will use literally any data that has statistical edge including but certainly not limited to price data.
The best way to make a killing is to have a deep understanding of an industry and hope for a black swan. How many people foresaw oil going negative when COVID started?
Im not sayin institutions, quants, or big capital traders are maliciously hunting stops but there is def something in whatever they are doing that utlizes & targets big levels of liquidity- which usually lots of whatever kind of traders, big or small, have stops or limits there. I've seen this everyday for 5 years now & it never fails. Are they doin it maliciously? prob not, i don't think they're out to get people, they just tryin to make money & thats where the money is
The question I have is why prices go up or down. Also, if there's a component (an algorithm or something else) responsible for price delivery in all markets, is it possible for someone to identify how it worked in the past using a simple candlestick chart? The last thing I want to discuss is that you mentioned people dedicate years to becoming specialists in one little piece of the whole system. Assuming the component mentioned above was designed by many people separately, if one can contrast between the work they did to design it and identify how it behaves on a chart, then is it possible to identify what the others did based on the chart and other economic factors?
Shhhh... I need the retailers to be confused and lost so that I have an edge in the market. Great video by the way, the truth. Surprised you use the word ''alpha'' here, nobody understands what you are talking about. Math, Statistics, and Programming is difficult for many people so this field which many people want to join is nearly impossible. Professional trading is such a in depth field that even if a retail trader studies the market, they will still never be profitable. I know people who have been trading for 40 years and they still are not profitable. It's a fun hobby for them. Trading is a good dream to sell to people though, lots of money to be made by fake gurus.
Maybe I'm a bit slow, but wat exactly does these machines learn , isn't historical price data n statistics just fancy terms for pattern recognition 🤔 IDK
I think there's a lot of different approaches to analyzing the markets, i used to program markov chain analyses for biological research (ethology). It was basically behavioral sequences of bouts of observed animals. Market data is similar in a way.
I dont understand why these people shy away to accept that they follow certain analysis instead of existing "TA" tools. Maybe thats how they claim business expenses by pretending to do the impossible BS
@@lokeshgnanasekar What are you saying? I think you are very confused. Technical Analysis (TA) has never been useful, it has never made anyone rich or even well-off, except for the various fraudsters who sell courses on this nonsense. The Quant sector is a very complex world if done at a high level, so you need a capable team of people, which means high costs that a home trader cannot afford. However, the possibilities from a scientific standpoint for creating complex algorithms are endless. That's why large funds create these quant teams.
@@dany84ct I totally agree with you with the courses but the quants are still trying to time the market in a fancy manner which is no different from analysing. All I know is basic quantum mechanics with decent maths, and I personally think these quant funds are BS and playing their best to offset tax liabilities. I really wonder how much return do they give
I've seen some Tradingview indicators that did some kind of ML on common tools (SMA, fib levels etc) and weighted them to produce various confidence levels. Not sure entirely how it works, but I know it's definitely a concept that exists. Besides that, a book I have called "Practical Quantitative Finance with R" shows off a strategy where you can use ML to predict how the trading prices in one market session influence the next (eg Japan->Europe)
No one cares about you personally, no, however, hedge funds track order flow for a reason, specifically hedge funds that own clearing firms. One in particular modifies margin requirement on high volume etf's at key price levels, this clearing firm services well over 20 million retail traders.
The thing is, u just use technical analysis as a catch all phrase, and u are demonstrating your bias against it. TA helps identify where price levels have been reacted to and potential liquidity pools are. Those levels are predictive based on where people have risk and money at. It can be argued that quant only would or would not describe those same issues either. No matter how smart any group is, the market does equalize all players when money and risk is on the line. Otherwise , large brand money managers would be beating the indices all the time.
Price patterns occur, in part, by stronger players trying to shake out weaker players, just like pump fakes and then lay ups. These patterns may be simplistically been named, but they fundamentally describe advanced strategic manoeuvres, which is great I suppose that ultra sophisticated and intelligent quants and PhDs would never realize the true nature of the market.... Which is to milk everyone of their capital.
That's not entirely accurate. Yes weak world models have a tendency to be more conspiratorial, but of course brokers can do order routing meaning priorizing those that are higher and they can take the spread and of course match internally the orders and prioritize them by profit. Along with other effects and quirks in the market that can lead to a noticable effects in 1% of the trades. But most of these trades are simply eaten up by mean reversion bots and the likes. 99% is human bias and the need to scapegoat. So not entirely wrong but also not very "deep" insight
Most of these bots btw, are probably run not by hedge funds but other market participants. The quants make most of their money with actual stock trades over longer periods. And of course unhedged quants don't exist. There is a simpler explanation to why FUNDAMENTALLY Quants cannot DAY TRADE primarily, simply because DAY TRADING is a ZERO SUM GAME setup. The whole idea of quants is to be the first in the game that is human producitivty and human behavior. That is essentially the market: Human brain (biases, herding, fight-flight, greed+fear, storytelling, 180 biases) + human productivity (participation in product building through a standardized virtualized token i.e. money). So HOW could there be quants over decades and make huge profits in a zero sum game and the quants becoming more not less under the assumption that they day trade. One has to be an imbecile or young, to believe this
Technical Analysis is not random. Price follows a pattern and even though it has nothing to do with the fundamentals. You are not a trader and you never looked into markets. Prices follows a trend, if it is random then tell me why? Why prices on the chart follows patterns and are not random😂
@@SherozeKhan2024 It's a zero sum game. If everyone Got profitable in Futures and every pattern started to work, then everyone will make money ( which the hedge fund and institutions doesn't want to happen ). That's why the patterns works 70% to 50% of the time and the human Psychology aslo interfare which is the reason in derivates, hedge fund makes a lot of money and retailers loose money...... It's not gambling, it's a probability system. Use your little brain. If pattern works everytime then no one will be able to make money because derivatives and stock market is a zero-sum game! Last thing to remember that in the market there are hedge fund and institutions and everyone is emotional of not losing money and everyone is trying to make money. That's why we wait for one force to overcome the trend and ride it, which is called probability system
@@SherozeKhan2024 Pattern not as in a Mathematical pattern that repeat itself infinitely. More a human behavioral pattern. You can study an individual and understand how they work based on their past behavior and the behavior of others (since we're all human and are biological determined). However, you can't predict for certain because each moment that passes is different meaning that the environment, whether it be external or internal, and can result in different outcome. It is not a predictive tool, it just gives you what, where and where to look at to best prepare yourself.
Ya, maybe "prop traders" at your favorite shitty "prop shop" like the ones run by college dropouts, which are basically glorified casinos. Real quantitative trading firms (i.e, actual "proprietary trading firms") are not using Chartology or random retail "indicators."
Please don't pay any attention to this jesus guy. There is TA. and you need to understand TA to code your trading system. Your system can be automated or you can manually trade it. I washed this guy 5years ago. Then i started educating my self on day trading. The journey is interesting profitable.this guy doesn't even know about day trading and what a quant firm is. He just speaks English and says nothing meaningful
So you're doing analysis using technology ... and that's not technical analysis? :D Or is your argument that technical analysis that has no roots in how markets work and is just drawing bats and hippos on the chart to say "100% this price will move like this" is BS? Because if that's the case, yeah, that argument is pretty simple. You don't have to go into elaborate analysis of what Simmons said. If there's a short squeeze on SMCI or gold it's not because there's a blue bat pattern on the chart or moon phase is right, it's because someone has enough money to do X and take profit Y. I'll pass on the elitism of "getting smart people together" and having a 100 PhDs in the room XD I've seen plenty of PhDs and folks with full tenure do things that a 10 year old wouldn't on a regular basis. The PhDs simply mean they are good at doing their flavour of math but NOT good enough to earn a living outside academia without a PhD :) Because, arguably, if you're really smart ... do you need others to give you a gold star participation PhD? No, you're able to cut it yourself :) All that being said ... chill, plenty of people doing a lot of money in discretionary prop trading who understand things like risk and probabilities and all that.
That is not true. Institutions can hunt SL...It's obvious that you're smart and that you're trying to make yourself look even smarter than you are in the video. But unfortunately, you don't know everything.
I dont think its efficient to track down anyone but its possible to manipulate with price and volume. I can confirm that FII and DII will play on your so called support and resistance 😆. The name "Coding Jesus" is pompous enough
i think it would be cool to see you trade, with ur "insider information" i don't devalue your own knowledge in this industry but all you do this speak theories really because i'm sure most these can be fact checked but other things like the models you speak of aren't true. The market is speculation and the way you speak is saying only if you are a "institutional professional" then you can make money in trading. . . come on bro.
I would like to see your stats over a period of time in day trading not fkin buying something and holding forever and then making a video when it's in profit. and i think it will shift the way you think right now because i think you are just an analyst.
I dont even trade but this guy makes me mad 🤣, I never support those funny patterns ever, but the way he pretends that he knows everything is a clear sign of ignorance OR is he trying to sell something?
You don’t “beat” or get “beaten” in markets. It’s an auction. Price can only move in two directions. So right out of the gate you have a 50/50 shot, which you then can increase with a little extra effort. Most people lose because of psychology. Not because it requires a phd.
> most lose because of psychology no, most lose because they have absolutely 0 edge. The whole "trading is just psychological" thing is just a claim perpetuated by youtube traders since it shifts the blame onto the viewer instead of the strategy or course they are selling. If you have conviction in your model, there is by definition no emotion or "psychology" involved in that trade. Your theoretical value is X, the stock is trading at X-5, you buy. The difficult part is figuring out X. Thats why there are PhDs doing that. The problem is retail traders cannot reliably predict theoretical prices at the level of a quant trading firm, so on average most day traders end up with a ~50% correctness rate, i.e their "models" (TA, whatever bs youtubers are selling nowadays, etc) have no real predictive power.
@@laggerlaggerson4375this comment is a great example of, I’m so eager to sound smart, I tripped over myself and sounded stupid because I ignored the obvious in order to create a false premise upon which to blather. Your points are all mostly invalid.
@@george_cantstandya Sounds like you're describing your own comment lol. Just yapping about how "my points are invalid" without any actual refutations. I worked at a quant trading firm, I think I know what I'm talking about. EDIT: youtube removed my comment 🙃
@@laggerlaggerson4375 I didn’t refute them because I chose not to and went to sleep instead. Not because I couldn’t. You already refuted yourself once in your response. Because you created a false comparison between what phds are hired to do, and retail trading. Didn’t refute it, but I can. But you refuted it for me. You made a claim that RUclips gurus sell psychology and not trading strategies or, edges, which is easily refutable. But I’m moving on. You then made a suggestion to buy and hold, which I could have shown to be arbitrary and without context. Which doesn’t work in tandem with your claim they don’t have an edge and take losing trades… and also works to support my point about psychology. I don’t feel like connecting all those dots for you. Your response was a mosaic of information, not a well formed refutation of my point, which is avg traders lose money because of psychology not because they can’t find a winning trade. If they can’t find a winning trade you gave them the worst advice, buy and hold, presumably a losing trade. That’s all the time I’m spending on this.
No offence but having watched a number of your videos and seeing your apartment in the background you don't come across as a even a mildely successful quant. Prove me wrong.
The funniest thing I hear all the time in retail trading circles is "the algorithm". There are millions of algos, not one.
I had a coffee with a Trader (Global Markets Analyst) at Citi Bank recently, I spoke to him about the concept of stop-hunting and quote he said "...to an extent we look at the psychological levels, the other institutions are looking at those "technical levels" as places to find an entry point/target price..." I was surprised by this concept, I don't think day traders are hunted, rather they are often found where institutions are looking to enter/exit due to a mix of factors, I doubt liquidity is the only/main reason.
Institutions don't give shit about retail stops
I know several current and ex institutional level traders
@@erics4127 retail stops ... no. Other institutional stops ... sometimes. Depends. Bigger participants (and traders who work for them) understand where other big participants are, or should be approximately, positioned. And sometimes you hit that and sometimes you don't. The way it was explained to me on a prop desk "Below a certain size market doesn't care at all. As you get bumped in size market starts to care because you, eventually, get to a size that moves said market". Right? Nobody cares about your 3 micros but get to a level where you trade 150 250 full contracts on DAX and suddenly everybody cares. The psychological levels are kinda just because it makes sense to look there for extra volume because big institutions need volume to execute the trade. You can't just buy 5k contracts on ES or CL without volume being there.
they dont but they care about where maximum or at least sufficient liquidity is to be found. this will often be at a prior swing high/low where there is sufficient opposing liquidity to fill a large order without moving price adversely for themselves
This man who is not even a Trader but a quant developer(software engineer) wants to beat the best traders in the world. Cringe
The only reason Jim Simmons hires 100 PhDs for his algorithms is because he manages larger funds and could not afford very large losses or declines. It's simply that.
The retail trader can operate running with 50% down, he can afford that risk. Jim Simmons, who manages hundreds of millions, could not run his operations with a drawdown of 50% of the billion.
It's a question of how much you have at risk and that is what makes the difference between a more complex method and a simpler one.
If Jim Simmons could afford to trade for example 50% down, the technical analysis would work.
Probably it would
see ya in the ..... poorhouse
@@thomasanderson4533 ha
This is the funniest thing i have read all year. Thank you.
If price is random, as you said in your other videos, then machine learning doesn't work in the market either.
@@pepesdi584 I dont think you understand what random means in this context. Price isnt a random walk. It doesnt have constant variance. But it certainly is stochastic (random).
@@AnthonyBerlin He said in his video about technical analysis :"There's something called the BROWNIAN MOTION, it is a stochastic process which means in the short and medium terms prices are entirely random"
I'm not here to back the chartists and no I'm not involved in the markets. but you can't profit from machine learning methods if the price follows a Brownian/Wiener process.
@@pepesdi584 Yeah, it's true that you wouldn't be able to profit from price if that was the case. But only an idiot would think prices can be modeled with only a Wiener process. Obviously you need a way more sophisticated stochastic differential equation than dW_t = N(0, sqrt(dt)) to model price changes.
@@AnthonyBerlin well that idiot is the one who makes the videos not me!
@@pepesdi584 I went from making fun of TA people, calling it astrologist for men even as early as this January I think, to being completely sold on TA, at least parts of it.
I joined a discord group, and saw day in and day out people make calls like SPY's going to $527, to fill a gap, then reverse back up probably. And I laughed as we were sitting at $534~, and goddamn, did it do exactly what he said it would. 6 months now i've seen how impressive these day traders are. They don't necessarily predict price action entirely. It's more like, if this happens, (X reaches this level), and makes this level a support, we should skyrocket to the next level. algo's can hide price action, which is true, but price action represents institutions trades. There are humans who put in orders first. Then disguised by algo market makers. If you understand the humans putting in the orders, you can make sense enough to get in line and skim the institutional orders. It randomly goes towards these liquidity spots, but once you know the spots (frequently called levels or support/resistance area's), you can make money.
Saying quant doesn't do TA is like saying machine learning doesn't involve pattern recognition.
a quant doesnt do your TA that you think of. Its way different than portrayed in youtube videos
He’s referring to price charting and indicators on charts. Quant TA is different
@@zoro8117 They are thinking of statistics, which is TA. Coding Jesus just doesn't know what he's talking about and that there are a lot of people making consistent money daytrading, swingtrading, position trading, scalping. There are people that beat the all-powerful algos he works on, true scalping, joining bid/ask and exiting within seconds. He doesn't know statistics either, sadly, but I'm sure his IT skills are good.
@@zoro8117It is still TA
Thats like saying a mathematician is the same as a Card reader because both use numbers. There is no statistichal proof of any TA techniques. Quants only use math in ways that have either theoretical proofs or have been tested statistically.
I don't think traders literally mean "they" are coming for my exact stop loss. But we understand "they" are aiming for retail money, and our stop losses tend to aggregate at certain levels
Hahaha. I tell people all the time that complain about stop loss hunting the same thing. Nobody cares! I'm a software engineer and been day trading for years. Understanding intraday market structure based on higher highs, lower lows, etc and average true range gave me the highest probability of wins. Most of my targets are twice of my stops. I only need to be right half the time to be profitable. However, my overall bias for the day is based on dealer gamma exposure. If you understand what the dealer might have to do to hedge their option positions then you can start to anticipate a possible move for the underlying. Note that many people out there use a naive approach to calculate the exposure, which is trash most of the time.
Wow Coding Jesus, you really do have a heart! That was probably the best post you’ve made clearing up misperceptions among day traders. You seemed to show some compassion, a first! You’ve really softened in your old age! Your usual approach towards day traders was often dripping in derision and bordering on hate. Despite all that I’ve been a longtime subscriber because I’m interested algotrading. I tip my hat to you! Sir!
Growing in this industrie sometimes is realizing that you spent a lot of time studying crap and useless stuff because it seems like a shorter road and it's easier, when you should have studied math, python, and markets theory
The more I learn to code strategies the more I find out that strategies work but only work in specific contexts
@@sothisremindsmeof.....1179 Every strategy works until it doesn't. The markets move in cycles and you need to adapt your strategies over time.
@@sothisremindsmeof.....1179 Why then do day traders make money? Is it worth it to learn technical analysis and stuff?
I study ema cross. Makes more % in 3 months than S&P500 in a year.
@@sothisremindsmeof.....1179 of course
But Jane street already admitted that they had printed one billion dollar profit from India by doing injection in the market.
I’m a QR. I agree with most of what Coding Jesus says, but he’s wrong on this.
It isn’t that Quant firms are chasing down individual retail traders, it’s that retail traders behave as a hive mind all acting off the same tweet or message board consensus, and subsets of quant trading strategies exploit the predictability of these trading patterns.
@@The.Harsh.Truths Maybe ive drank too much kool aid from my trading firm, but I don't think firms necessarily "target" retail antagonistically.
JS entered a market with a lot of price inefficiencies (and a large retail population), and they simply started pricing things better. In fact you could argue this is good for trading participants who actually use those options to hedge (maybe worse for other participants who actively traded those instruments).
@@laggerlaggerson4375 right. I agree. The thing is, derivatives markets are zero sum, and fancy quant firms have backtested and discovered exploitable patterns to take the other side of.
There are many market participants all arm wrestling in the market to eke out a profit.
When the quant firm consistently comes out on top, somebody lost. That somebody is often the retail trader. The market moves in a way that may seem unfair and unusual to them, but that’s simply a result of smarter quant firms always pushing the market in the direction that makes them money.
It isn’t always 1-to-1. Trading strategies are complex. How are ES future related to SPY ETF, and their corresponding options? The SPY order flow could just be a hedge to the options market where the real action is.
The point being, it is a complex game with multiple big players, and the retail trader, if behaving somewhat predictably, is often exploited as a consequence. Not personally. Mostly as part of a large group that’s on the wrong side.
@@laggerlaggerson4375 also, our firm made record profits during the whole meme stock era with GME, etc.
In that case, we were literally exploiting the dumb money buying and selling options on their small Robin Hood accounts. We were literally market making both sides and scalping all day for fat profits.
Jan St is also a HFT, market making firm. thats not what RenTech do. HFT is a different beast to quant investing.
we absolutely used technical analysis at Two Sigma, e.g. ARIMA models. maybe some nonsensical functions might represent things like "cup and handle" patterns by some Fourier terms of seasonality and exogenous variables where the equations represent parabolic/linear curves, but if it passes backtesting/out of time series testing, model validation, risk analysis, etc. then it would absolutely be deployed in production.
ARIMA is not considered TA lol
He’s a day trader larping as a Quant.
@@huhuboss8274 according to who? as far as i understand it, any technique/method that uses market data is considered TA. so machine learning would be TA because it uses some form of price data in their models
@@huhuboss8274 many do consider it as TA
My new favorite pattern-
"knees and Toes"
Jim Simmons was using AI before AI was a thing. He may have used TA for entry or exit but that about it.
How can youtubers beat or defeat 100phds.its impossible for a single person
Sometimes simplicity is the best way to fight complexity, like a simple 2:1 stop-loss.
You don’t need to beat them. Just ride the wave they create.
100 PhDs are easy to beat. But 100 PhDs selected by top company is impossible to beat
This guy is a software engineer. He is not a quantitative researcher or trader, and is not whatsoever in a position to consider "going it alone". He has no direct involvement in designing any trading strategies.
What do you work as then??
Found the ICT woreshipper
@@elmata1041 Itc is garbage..That is for sure..
Wrong. He’s a “Quant Dev”.
So he is expected to fully understand the quant side in order to properly code up the dev side.
I’m a QR but I work with QDs. They fully understand the models.
@@The.Harsh.Truths You can absolutely understand something presented to you without being able to come up with it yourself. He may be able to. All I am saying is that there is a difference between the skillsets of a quant dev and a quant researcher.
Technical analysis and machine learning are two different approaches to trading; they don't necessarily contradict each other. Machine learning usually allows for trading a very large number of instruments, aiming for a positive average return. Statistics only provide average and lagging data. A day trader, on the other hand, tries to make immediate and accurate decisions with a very limited number of instruments. They don’t care about averages. Just because your company or banks do not use technical analysis does not mean it is ineffective. The rules for managing large capital are also different. In my opinion, it’s a worthless video. Focus on your work; there’s no need to boast to anyone.
TA is innecfective. There are several studies that show 95% of people who use TA go broke in 1 year, almost all of the rest go broke in the next year. The hand full that dont make peanuts.
Also, not caring about average returns is insane. If your average return is not positive, you are just gambling at a rigged game.
Could you do a video on how small quant firms work and are started?
Ricky Gutierrez and other day traders claim that TA is a powerful tool and claim it takes time to build up the skills to trade profitability. What they forget is that luck is more powerful than skill in the market. Whoops...forgot they make the majority of their money from selling courses.
Hi Coding Jesus,
I love the content! I would just like to add a bit push back- when working individually, does it necessarily have to be considered “competing”? Cant someone want to do something individually just to have something lucrative on the side of their 9-5? Also, in regards to education, are companies strictly accepting college graduates? And if so, are they selective on the type of college that students attended? I have no degree & I want to explore all alternatives of education before going massively into debt. Assuming there’s no way around getting into debt for an education.
Thank you, Donald
Book recommendations
Order Flow Trading for Fun and Profit, Daemon Goldsmith
Evidence-based Technical Analysis, David Aronson
🙏
High Probability Trading Strategies, Robert Miner (limited* use)
I get it. It shouldn't be tried because it's too hard. Jeff Bezos should have never built Amazon either because that was hard. I shouldn't have spent 10 years studying for my CCIE. Maybe should have never made anything of myself at all.
The cope here is crazy lmao. Im a CFA, can confirm coding jesus is right
@@upstateNYfinest CFA lol
I am crypto retail trader, and i dont do TA, i do trade execution with DOM and times and sales which is orderflow analysis , and i do Onchain Analysis...but i am still a gambler as long as trading is directional.
Thank you for confirming what I've always believed.
Not to mention, aren't stop losses not even visible on the public order book? It is my understanding that brokers hold stop orders and only convert them to market/limit once triggered (which then they are placed on the public order book).
thats how stops are supposed to work, technically. just an opposing order that enters the book when a certain condition is met. but your stop orders, if placed onto the platform isn't client sided, it's stored on your broker's servers. you can bet that this "data" at an aggregate level is being sold by brokers to their partners, the tier 1 liquidity providers, market makers etc. if oil traders are willing to pay drone pilots for thermal imagery of storage facilities in Cushing to get an idea of the reserves ahead of each Wednesday's EIA report, it's not unimaginable for big currency traders to do similar things to get an edge.
In fact most brokerage agreements when you open an account will include something like this in their terms
"Information Sharing
BROKER XYZ has access to and may use and provide counterparties with client information, but will only do so on
an anonymous and aggregated basis. This information may include but is not limited to, your orders,
positions, trade and other data and analytics (collectively, “Anonymous and Aggregated Data”).
This Anonymous and Aggregated Data may be used for market information, analytical tools, risk
management strategies for market making and liquidity provision and other BROKER XYZ products and services.
The nature of any Anonymous and Aggregated Data provided to a counterparty may differ from that
provided to other counterparties in terms of quantity, scope, methodology or otherwise and may be
changed from time to time without notice to you." so yes your data; including stops is available to them and their counterparties; but no they're not targeting anyone specifically, they just need to find liquidity.
@@gh8066 I bet you love GME, don't you? Take off the tin foil.
HEAD & SHOULDERS, KNEES & TOES
Seems like writing code to automate trades based on data markers which have their basis in financial maths theory would be integral to quantitative trading. Because you’re just looking to have a huge volume of trades at a >51% odds of winning, then you can really multiply gains. Jim Simons also needed a huge team of maths people and coders to build the systems to capitalize on patterns in huge data sets.
While it’s true that professional quants have access to vast resources, the narrative that retail traders can’t compete algorithmically is overly pessimistic. Retail traders have access to quality data through APIs and financial platforms, and sometimes simplicity outperforms complexity. Niche markets often hold inefficiencies ripe for exploitation by agile, adaptable traders. Plus, communities and resources available to retail traders are extensive, fostering collective knowledge and innovation. The playing field might be uneven, but declaring it futile for retail traders to compete algorithmically is just lazy thinking. It’s all about leveraging the right tools and strategies!
We also don't have to worry about market impact of our trades. I can liquidate my entire position in an asset in a single order, which hedge funds can't do.
Retail traders trading on the backs of institutional trades can be anywhere from almost as profitable to slightly more profitable. Ant on the back of an elephant.
We can also take trades institutions can't. A couple of my best ETFs do
The human brain and screen time do the trick. Being green 30 days in a row would be 1 in a Billion if it was coinflipping but lots of traders have accomplished this feat.
Jim Simons pronounced S(eye)mons 👍🏽
Great job !! You’re helping a lot 🎉 Fire video
This guy is such an “expert” he doesn’t even know how to say the name of a legend
@@nj-bz8pv still debunked many failed TA traders
I remember a quant firm hiring people with swarm theory knowledge, which is, in part, 'liquidity hunting'.
My cousin made 400 bucks options "trading" (gambling) and I told him to just quit now he has absolutely no idea what he's doing. Lost it all. How the hell do you think you're going to consistently compete against math phds?
Do a math phd / take long term trades / kiss the ass of market makers.
You don't have to have a phd in math to make money in the market. But again, most people underestimate this and practically think it's get rich quick.
You know, we are not limited by liquidity. There is trade off to everything.
Don’t try to beat them just move along with them…there are tell tell signs of what way something will go which takes practice and lots of failure before you reach the success of a good retail trader
@@damianpos8832 that is the only good thing.
0:41 this does exist its NFP fridays with 100 pip wicks on either side to stop run retail
"ICT" traders are gonna love this one 😂 tell it like it is coding jesus 👍💯😄
bro if you get a high quality predictive pipeline, at some point you will have a dataset of tens or even hundreds OF THOUSANDs of features of all kinds, ma's, ema's, complex aggregates etc. Out of that you will get to the inference models with about 1k-10k features after selection stages, statistical analysis etc. And somebody is telling me there's still people who can compete with these models based on what, 3-5-10 features? Just think about it. By the way i'm senior ml/research engineer in sports/finance for 4.5 years already and also recently worked as a quant researcher as well.
PHDs spent more time studying theory that doesnt work from people that cant trade. what makes them so smart? If they spent the same time and energy observing markets maybe theyd have an idea on how to trade.
Either way doesnt matter, they play an important role in the market.
They understand theory in depth. Statistical theory. Martingale theory. In depth. All people do in "real life" is tweak it to their situation. But the phds made it. The knowledge gap between Joe schmoe and a PhD is bigger than you can imagine. Granted in a quant space someone with a bs in math could probably scrape by and learn enough on their own time to be competitive with a PhD. But a PhD still is usually very well rounded and just has thay depth you can't find in other places
What if you don't compete with the quant firms but simply use machine learning to find the most volatile segments of the market, enough to go up significantly over multiple years (albeit lose a lot during bear markets, the net result over 3+ years would be high).
Trading Jesus, can you address the concept of "edge". What edge are quant / prop firms exploiting? Is there any possible edge the humble individual trader can utilise? Or anything close to it. I think people here should be thinking about this rather than get agitated when you offend the "idols" theyve concocted in their brain
how about we do a challenge, futures trading you use some quant against me? you provide the demo account so you can have full control.
I make 3% on a day when nothing happens, 30 % on a good day; manual scalping. My FOUR attempts at replying to comments below detailing strategy, have been blocked by the moderator and deleted. Why? Astonishing.
i mean..Are you at least milonare yet?..If so can i learn?lol
I believe you. Now, talk to me about the dradowns.
@@damianpos8832 You watch and wait all day, until there is both volume and momentum, then you join in for a few seconds to several minutes. Do that 40 to 120 times a day. I use no more 15 % of capital per trade at a leverage of no more than 1:100, through high probability trades a win rate of over 80%. It may require several years practise. It’s easiest to have a friend or family member show one, and even then everyone has to find their own way, as not all are suited to scalping. It’s very full on. I have ADHD, I am lucky the hyper focus kicks in and time at the screens flies. I don’t have a need to talk about it. Opening a dialogue about trading to bright people who know nothing of the sphere, is likely to be met with rejection and a deaf ear. It’s a taboo subject for those who are uninitiated.
@@BCa00000 There are no draw downs of any relevance scalping high probability with momentum and volume, small position sizes, just joining in for a few seconds to several minutes. One is making just 0.075 of a % gain, 40 times a day, for 3 % total daily gain, for a few seconds to several minutes keeping a CFD position open. If 20 % to 40 % of one’s trades don’t work out by going in the right direction immediately or within several minutes, these losses are small to shut down and the day still profitable. It’s a huge psychological mind game plus fundamental and technical analysis. They say no more than 2 % who try to learn this have the right combination of intellect and psychological profile. It can take quite some time practicing, a year or two.
@@BCa00000 My two replies have been deleted. Astonishing. Why?
How is the performance comparing quant companies towards voo in a long term period?
Head shoulder knees and toes 😂 cocomelon type beat
Hey Coding Jesus, hope you're doing well. Is day trading and trading in general a sum zero game? As far as I can tell it looks like so since for one to win another has to lose.
The derivatives market is a zero sum game.
@gabriellinassi3382 not really but it certainly is if you base it on strategy. I backtested pretty much everything and it's always 50% at 1:1 minus fees. Discretionary trading is more about account management and position management than actual entries, most people will never get that but by algorithmic backtesting I just accepted that it was basically random so I use randomness to my advantage by cutting losses, running winners and hedging. I have 0 quant level skills besides coding so I only tested retail technical stuff... machine learning helped win rate but still I want to learn proper data analystics methods before bothering with quant/automation. Discretionary is kind of the opposite of what everyone thinks it is, you are compteting for the same setups with millions of other traders so you have to manage trades better than atleast 50% of them to win consitently.... it's not something to be taught only learned and I feel like it's a miracle i got there after about 5 years.
And FYI manging trades and accounts isn't just risk reward etc... it's more of an art to be improved and it's really f ING hard and it never becomes easy... get comfortable being uncomfortable if you go down that path because if its not uncomfortable, you're doing it wrong.
Minus sum.
There's a 3rd player who never loses - your broker and his fees!
Yes, one man's Joy is another man's misery
What about Paul Tudor Jones, Jesse Livermore and other giants traders who used technical analysis and were highly successful?
Good question
Because probably they had 101 phds or probably 102 phds
@@AzriRich88 Did Jesse Livermore and Paul Tudor Jones have 102 phds? Probably not, yet they made hundreds of millions
dude, they discovered patterns and exploited them . Same as quants. Without being quants.
my go to is instead of using TA indictors is to use the symbolic regression libraries along with the generic programing ones to "find" new indicators and then score them not on like percentage gain or loss but their entropy and then use a whole whack load of those in random forest ML to find out if tomorrow is going up or down for a stock and to only use stuff with a high confidence
Do you feed the model with price/volume or micro data like trades and the order book? Also do you use a fixed model for managing risk or also something ML driven?
@@taltalonix OHLCV data from like 5500 us companies and then i wasn't really sure what metrics to use so i just ran every test i could think of and eventually started seeing "indicators" that predict the sign of the next days percent gain or loss better than random like 51.6% instead of just 50/50 but you know if you collect 100 of those and they are uncorrelated and feed that into a random forest you can get some pretty good results. Killing the market with death from 1000 slight edges.
The stastistcal data quants use , isnt it based on historical price data? Do quants use any fundamentals? If so, how amd what and how is it fed into algorithmic Trading decisions?
Yeah they use any data... for example some big firms built camera systems on ports to count the number of trade ships and predict balance of trade. They will use literally any data that has statistical edge including but certainly not limited to price data.
The best way to make a killing is to have a deep understanding of an industry and hope for a black swan. How many people foresaw oil going negative when COVID started?
Im not sayin institutions, quants, or big capital traders are maliciously hunting stops but there is def something in whatever they are doing that utlizes & targets big levels of liquidity- which usually lots of whatever kind of traders, big or small, have stops or limits there. I've seen this everyday for 5 years now & it never fails. Are they doin it maliciously? prob not, i don't think they're out to get people, they just tryin to make money & thats where the money is
The question I have is why prices go up or down. Also, if there's a component (an algorithm or something else) responsible for price delivery in all markets, is it possible for someone to identify how it worked in the past using a simple candlestick chart?
The last thing I want to discuss is that you mentioned people dedicate years to becoming specialists in one little piece of the whole system. Assuming the component mentioned above was designed by many people separately, if one can contrast between the work they did to design it and identify how it behaves on a chart, then is it possible to identify what the others did based on the chart and other economic factors?
supply and demand lol
This guy is just a frustrated failure who just thinks he knows everything
will u ever realease ur own service? like a pamm or fund?
Shhhh... I need the retailers to be confused and lost so that I have an edge in the market. Great video by the way, the truth. Surprised you use the word ''alpha'' here, nobody understands what you are talking about. Math, Statistics, and Programming is difficult for many people so this field which many people want to join is nearly impossible.
Professional trading is such a in depth field that even if a retail trader studies the market, they will still never be profitable. I know people who have been trading for 40 years and they still are not profitable. It's a fun hobby for them. Trading is a good dream to sell to people though, lots of money to be made by fake gurus.
that was a nice Jim Simmons interview
so you're saying that firms like Melvin, Citron, Citadel, etc. were not targeting retail traders of GameStop?
It was certainly the other way around 😅
so what was Citadel doing with the data bought from Robinhood?
Knees and toes pattern for the win!
not heads and shoulders not knees and toes... my heart broke :(
Maybe I'm a bit slow, but wat exactly does these machines learn , isn't historical price data n statistics just fancy terms for pattern recognition 🤔 IDK
Hi coding jesus,
can u talk more about using continous time markov chain to have the recurrent and transient area in forex market before breakout?
The evil institutions keep hunting my stop loss. (I trade on a sim account)
I think there's a lot of different approaches to analyzing the markets, i used to program markov chain analyses for biological research (ethology). It was basically behavioral sequences of bouts of observed animals. Market data is similar in a way.
It makes so much sense to me.
The IRS, they allow for T&A...
What about statistical learning, what do you think Jesus? since it is halfway between statistics and machine learning.
I dont understand why these people shy away to accept that they follow certain analysis instead of existing "TA" tools. Maybe thats how they claim business expenses by pretending to do the impossible BS
@@lokeshgnanasekar What are you saying? I think you are very confused. Technical Analysis (TA) has never been useful, it has never made anyone rich or even well-off, except for the various fraudsters who sell courses on this nonsense. The Quant sector is a very complex world if done at a high level, so you need a capable team of people, which means high costs that a home trader cannot afford. However, the possibilities from a scientific standpoint for creating complex algorithms are endless. That's why large funds create these quant teams.
@@dany84ct I totally agree with you with the courses but the quants are still trying to time the market in a fancy manner which is no different from analysing. All I know is basic quantum mechanics with decent maths, and I personally think these quant funds are BS and playing their best to offset tax liabilities. I really wonder how much return do they give
Can some of the TA ideas be used and optimized with the help of machine learning ?
I've seen some Tradingview indicators that did some kind of ML on common tools (SMA, fib levels etc) and weighted them to produce various confidence levels. Not sure entirely how it works, but I know it's definitely a concept that exists. Besides that, a book I have called "Practical Quantitative Finance with R" shows off a strategy where you can use ML to predict how the trading prices in one market session influence the next (eg Japan->Europe)
No one cares about you personally, no, however, hedge funds track order flow for a reason, specifically hedge funds that own clearing firms. One in particular modifies margin requirement on high volume etf's at key price levels, this clearing firm services well over 20 million retail traders.
did you ever try ifvg ?
Ecactly. No one cares about your positions or your 1 to 100 contracts.
Trading has alot of aspects to look at... But one thing i am sure, there is always manipulation to Go in and Get out of the market...
i wanna teach my own algorithm and say "nah I don't need 97594 people"
So whats a point? ull never beat them
Well what about behavioural finance and taking advantage of psychological biases of other traders?
What percentage of money in the market's is psychologically influenced to the extent money can be made off them? No day trader has ever answered this.
Rentec is using markov stoch rsi and bollinger bands
Did you just say they are beyond saving 😂😂
The thing is, u just use technical analysis as a catch all phrase, and u are demonstrating your bias against it. TA helps identify where price levels have been reacted to and potential liquidity pools are. Those levels are predictive based on where people have risk and money at. It can be argued that quant only would or would not describe those same issues either. No matter how smart any group is, the market does equalize all players when money and risk is on the line. Otherwise , large brand money managers would be beating the indices all the time.
Price patterns occur, in part, by stronger players trying to shake out weaker players, just like pump fakes and then lay ups. These patterns may be simplistically been named, but they fundamentally describe advanced strategic manoeuvres, which is great I suppose that ultra sophisticated and intelligent quants and PhDs would never realize the true nature of the market.... Which is to milk everyone of their capital.
Prob. talking about the con-artist named ICT (I CAN'T TRADE!)
That's not entirely accurate. Yes weak world models have a tendency to be more conspiratorial, but of course brokers can do order routing meaning priorizing those that are higher and they can take the spread and of course match internally the orders and prioritize them by profit. Along with other effects and quirks in the market that can lead to a noticable effects in 1% of the trades.
But most of these trades are simply eaten up by mean reversion bots and the likes.
99% is human bias and the need to scapegoat. So not entirely wrong but also not very "deep" insight
Most of these bots btw, are probably run not by hedge funds but other market participants.
The quants make most of their money with actual stock trades over longer periods. And of course unhedged quants don't exist. There is a simpler explanation to why FUNDAMENTALLY Quants cannot DAY TRADE primarily, simply because DAY TRADING is a ZERO SUM GAME setup.
The whole idea of quants is to be the first in the game that is human producitivty and human behavior. That is essentially the market: Human brain (biases, herding, fight-flight, greed+fear, storytelling, 180 biases) + human productivity (participation in product building through a standardized virtualized token i.e. money).
So HOW could there be quants over decades and make huge profits in a zero sum game and the quants becoming more not less under the assumption that they day trade. One has to be an imbecile or young, to believe this
This guy gives out about other ppl selling trading courses, then proceeds to advertise his 1-1 tuition at the end 🤣
Technical Analysis is not random. Price follows a pattern and even though it has nothing to do with the fundamentals. You are not a trader and you never looked into markets. Prices follows a trend, if it is random then tell me why? Why prices on the chart follows patterns and are not random😂
if patterns when why you are still losing money??? If there is a pattern then there is no need of stoploss.
@@SherozeKhan2024 It's a zero sum game. If everyone Got profitable in Futures and every pattern started to work, then everyone will make money ( which the hedge fund and institutions doesn't want to happen ). That's why the patterns works 70% to 50% of the time and the human Psychology aslo interfare which is the reason in derivates, hedge fund makes a lot of money and retailers loose money......
It's not gambling, it's a probability system. Use your little brain. If pattern works everytime then no one will be able to make money because derivatives and stock market is a zero-sum game!
Last thing to remember that in the market there are hedge fund and institutions and everyone is emotional of not losing money and everyone is trying to make money. That's why we wait for one force to overcome the trend and ride it, which is called probability system
@@SherozeKhan2024 Pattern not as in a Mathematical pattern that repeat itself infinitely. More a human behavioral pattern. You can study an individual and understand how they work based on their past behavior and the behavior of others (since we're all human and are biological determined). However, you can't predict for certain because each moment that passes is different meaning that the environment, whether it be external or internal, and can result in different outcome. It is not a predictive tool, it just gives you what, where and where to look at to best prepare yourself.
Prop Traders use TA get over it
The most they use is EMAs and not for the reasons you think
@@raneena5079 gotta use that hyper EMA MA fused log ma atlantis testicular cancer MA obama indicator
Ya, maybe "prop traders" at your favorite shitty "prop shop" like the ones run by college dropouts, which are basically glorified casinos.
Real quantitative trading firms (i.e, actual "proprietary trading firms") are not using Chartology or random retail "indicators."
I'm listening
9:01 Not even coding jesus can save you
Does he have discord though ?
And yeah i feel like good technical analysis should be based on good statistics and probability, otherwise what is it based on….?
Candle stick trading
U miss fish hook pattern. 😂 I am also a trader but not a pattern trader. I am price action + buisness psychology
Please don't pay any attention to this jesus guy. There is TA. and you need to understand TA to code your trading system. Your system can be automated or you can manually trade it. I washed this guy 5years ago. Then i started educating my self on day trading. The journey is interesting profitable.this guy doesn't even know about day trading and what a quant firm is. He just speaks English and says nothing meaningful
super interesting.
100phds how many you tubers have that
This guy doesnt know what he's talking about
But why don't you give me some tips so I can make big money in the stock market, why do you keep the secrets.
i think you should be open to the idea that you dont know what you dont know
understood
So you're doing analysis using technology ... and that's not technical analysis? :D Or is your argument that technical analysis that has no roots in how markets work and is just drawing bats and hippos on the chart to say "100% this price will move like this" is BS? Because if that's the case, yeah, that argument is pretty simple. You don't have to go into elaborate analysis of what Simmons said. If there's a short squeeze on SMCI or gold it's not because there's a blue bat pattern on the chart or moon phase is right, it's because someone has enough money to do X and take profit Y. I'll pass on the elitism of "getting smart people together" and having a 100 PhDs in the room XD I've seen plenty of PhDs and folks with full tenure do things that a 10 year old wouldn't on a regular basis. The PhDs simply mean they are good at doing their flavour of math but NOT good enough to earn a living outside academia without a PhD :) Because, arguably, if you're really smart ... do you need others to give you a gold star participation PhD? No, you're able to cut it yourself :) All that being said ... chill, plenty of people doing a lot of money in discretionary prop trading who understand things like risk and probabilities and all that.
That is not true. Institutions can hunt SL...It's obvious that you're smart and that you're trying to make yourself look even smarter than you are in the video. But unfortunately, you don't know everything.
cope
Dumb coping retail traders.
@@weiSane I don't copy retail traders. Useless to argue with someone like you.
@@erion5002didn’t mean you were copying them. Cope and copy are two different things
I dont think its efficient to track down anyone but its possible to manipulate with price and volume. I can confirm that FII and DII will play on your so called support and resistance 😆. The name "Coding Jesus" is pompous enough
preach
i think it would be cool to see you trade, with ur "insider information" i don't devalue your own knowledge in this industry but all you do this speak theories really because i'm sure most these can be fact checked but other things like the models you speak of aren't true. The market is speculation and the way you speak is saying only if you are a "institutional professional" then you can make money in trading. . . come on bro.
I would like to see your stats over a period of time in day trading not fkin buying something and holding forever and then making a video when it's in profit. and i think it will shift the way you think right now because i think you are just an analyst.
Broker B Booking.
Dudes who made $4 from day trading mad in the comments 🤣
I dont even trade but this guy makes me mad 🤣, I never support those funny patterns ever, but the way he pretends that he knows everything is a clear sign of ignorance OR is he trying to sell something?
@@lokeshgnanasekar He sells resume reviews and 1:1 career consults, not trading strategies
Dead kitty bounce
You don’t “beat” or get “beaten” in markets. It’s an auction.
Price can only move in two directions. So right out of the gate you have a 50/50 shot, which you then can increase with a little extra effort. Most people lose because of psychology. Not because it requires a phd.
> most lose because of psychology
no, most lose because they have absolutely 0 edge. The whole "trading is just psychological" thing is just a claim perpetuated by youtube traders since it shifts the blame onto the viewer instead of the strategy or course they are selling.
If you have conviction in your model, there is by definition no emotion or "psychology" involved in that trade. Your theoretical value is X, the stock is trading at X-5, you buy. The difficult part is figuring out X. Thats why there are PhDs doing that.
The problem is retail traders cannot reliably predict theoretical prices at the level of a quant trading firm, so on average most day traders end up with a ~50% correctness rate, i.e their "models" (TA, whatever bs youtubers are selling nowadays, etc) have no real predictive power.
@@laggerlaggerson4375this comment is a great example of, I’m so eager to sound smart, I tripped over myself and sounded stupid because I ignored the obvious in order to create a false premise upon which to blather.
Your points are all mostly invalid.
@@george_cantstandya All his points are spot on. You couldn't even argue them.
@@george_cantstandya Sounds like you're describing your own comment lol. Just yapping about how "my points are invalid" without any actual refutations.
I worked at a quant trading firm, I think I know what I'm talking about.
EDIT: youtube removed my comment 🙃
@@laggerlaggerson4375
I didn’t refute them because I chose not to and went to sleep instead. Not because I couldn’t.
You already refuted yourself once in your response. Because you created a false comparison between what phds are hired to do, and retail trading. Didn’t refute it, but I can. But you refuted it for me.
You made a claim that RUclips gurus sell psychology and not trading strategies or, edges, which is easily refutable. But I’m moving on.
You then made a suggestion to buy and hold, which I could have shown to be arbitrary and without context. Which doesn’t work in tandem with your claim they don’t have an edge and take losing trades… and also works to support my point about psychology. I don’t feel like connecting all those dots for you.
Your response was a mosaic of information, not a well formed refutation of my point, which is avg traders lose money because of psychology not because they can’t find a winning trade.
If they can’t find a winning trade you gave them the worst advice, buy and hold, presumably a losing trade.
That’s all the time I’m spending on this.
No offence but having watched a number of your videos and seeing your apartment in the background you don't come across as a even a mildely successful quant. Prove me wrong.
U an idiot