“No Mrs. Wantanabe, you can’t break the trade cuz you lost money!”
I feel like I’ve been transported into the "bizarro" world of George Costanza.
Does every frickin’ day this year [almost] have to exhibit “tail risk”, that in some cases hasn’t been seen in years or decades? Ok, let’s start at the top, and I’ll work my way through this day … another “bizarre” adventure to be sure. I hit the computer screen about 15 minutes prior to the 08:00 open, and what’s my first reaction within 2 seconds? “WTF is this all about? 115 PIP range in GBPCAD in Asia? Seriously? … This is gonna screw things up “bigly & yuge” … only God knows what’s gonna happen, and at this point I’m not sure He even knows”. Cuz here’s what I know: both CAD & GBP are the slowest and least volatile pairs in the Asian session historically … hell, some nights you can’t get a 15 PIP range after 8 hours … now all of a sudden, Mrs. Wantanabe and her “gal pals” have started to trade CAD, GBP, & GBPCAD? “Please Mrs. Wantanabe, go back to gold and Japanese stocks, where for years you’ve gotten “monkey hammered” … people need you there … the last thing I need is for you and your pals to create volatility in Asia for these 3 pairs, cuz when you do, you totally screw things up for the following 12 hours”. And boy, are things screwed up today.
So natch,, seeing this, I know the first minutes will be dull … yea, like the first 440 minutes of the day, where once again [like yesterday] we’re looking at an approximate 45 PIP range at the extremes, where any and all algorithm signals so far have failed due to the extreme lack of price movement. Directly below the first 4 hours followed by the 8-hour, with commentary.
[click on charts to enlarge]
And, as you can see from the second chart, the infamous “Flying Wedge of Death” [FWD] ever present yet again today … “gee, what could go wrong”? So, with only approximately 35 – 40 minutes to go in the 8 hour session, all hell breaks loose with the 121 & 183 EMA’s flat, and after trying to take out some lows [which failed], it’s off to the races in a “to the moon Alice”. I was hoping to get long on a spike down [20 PIPS+], but the decline down to the 173.130 interim low, still only put the 8-hour range around 50 PIPS … that’s simply not enough of a range to start trying to pick bottoms. Well, from here it’s straight in GBPCAD, up 135 PIPS in an hour and 35 minutes, with the last 50 PIPS in 100 seconds in 10 PIP increments [would have loved to see the fill on 5 million stuff trying to buy on the way up … no, not really!]. The only legit signal all day, is after the explosion to the high and the subsequent selloff, where the EMA’s are flat, and the buy signal shouldn’t be taken … but again, in George Costanza’s world …
But first, let’s step back some, to U.S. data that came out at 8:30 EST; personal income and jobless claims were on the docket … yawn, big deal, cuz everybody knows they aren’t important enough to worry about … unless they are 10 standard deviations off consensus, they won’t move anything. But that doesn’t mean the scumbag LP’s can’t siphon money out of your account if you are in any position in GBPCAD and have a stop either above or below the market.
Right at the 9:30 bell, directly below I was able to be quick enough to capture a screenshot of the bid/offer order box … look at the tick chart to the far left to see the spread, and what they did, was jack up the offer and at the same time “monkey-hammered” the bid … how does 30 bid at 65 sound to you on minor data? Cuz I hope you realize, that by doing this these assclowns have just taken out all buy stops above the last hour high and at the same time have just taken out all the sell stops below the last hour market low … nice work if you can get it. Directly below, first the order box, and then the M1 chart with commentary.
I want everyone to know, and see with your own eyes, the utter LP bullshit I [along with others] have to put up with and deal with so as not to get totally screwed by these thieves, that call themselves legitimate liquidity providers. There’s no such thing … these assholes are only interested in one thing and one thing only; that is, stealing money from customers every single day, without batting an eye, cuz the regulators and brokerage houses are bought off, and basically told to look “the other way”. It’s disgusting, but it won’t stop cuz nobody but us is affected; everybody else in the “food chain” gets to eat at the “customer account” buffet gratis … even when they get caught [HSBC, Barclays, & Deutsche Bank anyone?], nobody goes to jail … all they do is pay a meaningless fine, and it’s back to biz as usual.
So here we are at 2 P.M., and for the second day in a row, USDCAD has put in a “double reversal”; this with employment data out tomorrow … I’m trying to believe it, but I’m having a tough time getting my arms around this … it’s tough to get one of these once in 2 or 3 years, and now 2 days in a row? … but in George Constanza’s “bizarro” world, I guess we can expect these now on a regular basis … I’m trying real hard not to go crazy. [Just as a side note, in all my years and decades of trading, once an established range has ben put in, I have never seen a triple reversal during a trading day … never … with the way things are going, expect one next week.]
Of course, all this simply means GBPCAD can jump 20 PIPS+ in seconds; which it has done, and if you’re on the wrong side of things, it can mean a very messy liquidation. This day, like yesterday sees the following: 1) Asia goes nuts over GBP & CAD, which it doesn’t do 99.99% of the time in all trading days, 2) both days have … literally … ZERO trading action the first 7 hours plus in our trading day, and then explode, and 3) both Cable & CAD are exhibiting “double reversals” and the FWD way, way, way too often; historically, there have been frickin’ years you don’t see this ONCE, and now it’s as if it’s an everyday occurrence … ho hum … I guess this is how markets trade? Again, I’m in George Costanza’s “bizarre” world … somebody shoot me in the head to see if I’m dreaming; if not, that’s OK, cuz I’ll be dead and don’t have to deal with this “bat guano” anymore.
And, as I write, GBPCAD goes “berserk” … natch, why not? … and goes orbital due to “Brexit” news, going up 40 PIPS in less than a second to new highs by less than a PIP [buy stops anyone?] before immediately dropping 30 PIPS in a heartbeat. “I’m sorry … this volatility of going from literally ZERO price movement to “off the charts” in seconds, with bids/offers littered with huge slippage, and any stop filled at the appropriate high/low … this isn’t trading, this is gambling”. Fact is, whether you’re long or short you WILL GET HURT, and plenty of people are getting obliterated. And, just in case somebody wants too know why I wasn’t long, it’s cuz the 121 & 183 EMA’s were flat, and the algorithm doesn’t take positions when the EMA’s are flat.
I said the other day, that I wanted a market like the “old” Swiss Franc futures from back-in-the-day; so far, GBPCAD is about 10 times more volatile, with the old Swissy never exhibiting this kind of volatility we have seen in the last 3 days. Watching prices go up/down 50+ PIPS in seconds, and then 5 seconds after that it’s 30 PIPS away from the extreme; seeing this multiple times, it isn’t a question of capturing it, it’s a question of “how to avoid being on the other side and seeing your stop get butchered by scumbag LP’s; and that is a very real problem when a market gets like this”.
Quite frankly, I don’t know where this ends … every attempt at selling GBPCAD gets obliterated quickly, and if you’re short, the spikes up taking out your sell stop or you hitting the “market execution” button to liquidate, are ugly as hell as the scumbag LP will absolutely not fill your order fairly; add it all up, and the losses can mount very fast. What I do know from experience, though, is that if this continues much longer, this will be ugly as hell on the way down … I really don’t want to see this, but it is what it is. Tomorrow sees Canadian employment data; if the “Chuckleheads” in Asia bid it higher tonight and then into the report the market is in fact higher, and the news is “Loonie bullish”, GBPCAD will get crushed tomorrow in seconds. Not predictin’, just sayin’.
What we’ve seen this week in GBPCAD, I don’t think we will see again for a very long time … every “tail risk” event with not just low probability, but extremely low probability, has happened simultaneously every single day. I still truly believe GBPCAD is the market to trade with the “Scalper’s Algorithm”, but realize that in the last 10 trading days [excluding today], 8 of those days have been below the 2017 average for the 8-hour range … most significantly lower, and both yesterday and today sees an explosion in price during the last minutes of the 8 hour period, thus saving 10 in a row below normal. The problem, from a trading perspective, with this kind of market scenario, is that the signal generators are flat and can’t respond fast enough [even though they are as fast as I can make them and not have “false positives”] to these types of moves that come in seconds and then disappear just as fast … and then the market “dies” for hours on end and the signal generators go flat again; when prices explode, there’s no way to know at the start whether it’s legit or simply a fake out. What generally makes the crosses great trading instruments, is due to the fact that between 2 markets there should be a “give and take” to prices, thus allowing signals to be generated and profits captured … “except, we’re in George Costanza’s “bizarro” world”.
If I didn’t know better, watching the very large spikes on almost every signal generated by the algorithm, I’d be thinking there are those “gaming” the algorithm to get traders to buy/sell the spike so they can fade it; but I know better … still, we re in George Costanza’s “bizarro” world, so just sayin’.
I really thought today could have been a stellar trading day …that is, until I opened my computer and saw what Mrs. Wantanabe and her “gal pals” did to the least volatile FX pairs on the planet in the Asian session; well, whaddaya gonna do, cuz if you “wing it” with low volatility, it simply becomes a “coin flip” over and over from high to low and then back again multiple times. How many times you gonna do this before you realize it’s stupid?
It’s easy to look at today’s 200 PIP range in GBPCAD and think it was “’easy pickins”; it was anything but, as all the gains after about 15:15 server time, came on fast spikes that quickly got sold off … if you took any of the 3 algorithm signals that came before the big 50 PIP spike, you lost money on each or maybe you were lucky enough to scratch them, but there was no money to be made; one had you buying a large spike that was a sure loser, the second one could have made a few PIPS if you sold the high M1 [unlikely], and the third was a pure 10 PIP loser. Why? Cuz at that point we already have a 150 PIP range and traders fade the spikes … yes, they got it rammed up their “you know what”, but nonetheless the 3 trades didn’t yield anything. So, no trades today, simply cuz there were no signals to buy that weren’t 20 PIPS away from the signal in seconds, and the interim low was to low to buy with only a range of about 50 PIPS. It is what it is, but remember, both yesterday and today we’ve been in George Costanza’s “bizarro” world.
Yea, I’m just as frustrated as anybody else at not seeing an algorithm trade in GBPCAD today, but it doesn’t do me any good to take a series of 10 – 15 PIP losses, and then need a “Hail Mary” to break even … which we got … but it’s not a position you want to be in, just so you can say you broke even. I don’t know if tomorrow sees a reversal in price, as Friday’s aren’t historically large trading range days … if it does happen, most likely we will see it in CAD via the employment report at 8:30 EST … still, a plunge in USDCAD will get bought aggressively by the trade, and that, by default, will goose GBPCAD … I hope we see it, otherwise it could be a very slow day, cuz I don’t think anybody is going to go after Cable tomorrow on the downside … a little profit-taking early at the European open maybe, but after that I doubt it … it too will get bought as well on quick moves lower.
Hopefully tomorrow sees some good algorithm trades; quite frankly, I’m getting pissed off at seeing nothing but less than 5% to 10% probability events happen day-after-day. I realize everything has to happen eventually … that word is “eventually” trading Gods, not every frickin’ day! … Geesh … I’m extremely happy at the algorithm’s theoretical performance … I’m not so happy with large spikes that seem to accompany every damn one of them, cuz those spikes are what we want to see when we liquidate, not at entry; the spikes rob our position of “fuel”, and I’m not the one who wants to be buying/selling “fuel”, when everybody else is in a short-term panic and the scumbag LP’s are handing out slippage like Halloween candy. That scenario doesn’t make for good entries.
I’m still trying to get the PAMM spreadsheet up and going; ever know anybody with as much trouble as I have either with MS Excel or Open Office? Some days I wonder, but I’m gonna try it again tonight … hopefully it will be up for tomorrow’s trades … we’ll see.
Tomorrow is another day [Duh], and I’m looking forward to some good algorithm signals … only wish I could find the transporter to get out of George’s world … good grief, this is like getting 10 #23’s in a row on a roulette wheel [which has happened], but this too shall pass, trust me. As for me, it can’t come soon enough, and believe me, I’m ready for it cuz the algorithm is pure “gold”. Stay patient & disciplined mi amigos; Onward & Upward!!
Have a great day everybody!
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