Market prediction based on macroeconomic indicators - page 7
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How can I predict a crash caused in May 2010 by a robot error (that's what everyone thinks) and the euro collapsed more than 1000 (!) pips, or a crash caused by the franc's January behavior?
A crash is a crash because it happens IMMEDIATELY! :)
Such intraday crashes are not taken into account by my model as all entries and exits (S&P 500) are averaged over quarters, i.e. 3 quarter averages are taken. The market always quickly returns to the economic and political fundamentals driving it after such short-term mistakes. If I was in command on the day of the flash crash, I wouldn't even notice that there was such a crash looking at my investments.
I must be using the word crash wrong. I'm interested in recessions or other large magnitude market movements lasting at least 1 quarter. 2008 is a CRASH and the flash crash of May 6, 2010 is a mosquito bite to an elephant.
These intraday crashes are not taken into account by my model as all entries and exits (S&P 500) are averaged over the quarters, i.e. 3 quarter averages are taken. The market always quickly returns to the economic and political fundamentals driving it after such short-term mistakes. If I was in command on the day of the flash crash, I wouldn't even notice that there was such a crash looking at my investments.
I must be using the word crash wrong. I'm interested in recessions or other large magnitude market movements lasting at least 1 quarter. 2008 is a CRASH and the flash crash of May 6, 2010 is a mosquito bite to an elephant.
Are you suggesting that the crash on the quarterly chart has a different pattern to the crash on the minute chart?
I mean, are you rejecting the idea that markets are fractal?
Do you think that the crash on the quarterly chart has a different pattern from the crash on the minute chart?
Adjusting your position once a quarter is the lot of millionaires. :)
Unfortunately I can't put myself in this category.
There is such a trick in extrapolation as trend removal, so to remove it correctly it must first be correctly predicted.
By removing the trend it is possible to predict smaller fluctuations more accurately.
Are you suggesting that the crash on the quarterly chart has a different pattern from the crash on the minute chart?
I mean, do you reject the idea that markets are fractal?
Adjusting your position once a quarter is the lot of millionaires. :)
Yes the pattern will be different, but the crashes may look similar with a difference in timeframes. So I'm not denying the fractality of the price series, I'm denying the fractality of the pattern. By the way, having my model in hand and knowing during a flash crash that there are no economic preconditions for such market behaviour, you could make a lot of money if you bought quickly. Some time ago my model predicted a market decline followed by a rapid rise. I bought the S&P-short ETF as insurance for my long-term investments in various stocks. The market did go down and then went up and I made a little profit on it. "A little" because I keep fine-tuning my model and don't trust it 100%. If the model had predicted a few quarters of downward movement, I would have sold all my investments. High frequency trading no longer interests me. The intraday timeframes are full of noise and trading is not based on economic indicators but on technical ones.
I don't understand what a fractal model is. Sines with different parameters amplitude frequency fz, it is the same model, fractal it will be to moddy sin(sin(x)), but it will not be sine, it will be another model.
Although, behind all this I think I understand your point: there is some transition from the model of thechanalysis to the model of fundanalysis with increasing TF, it is most likely not clear and there is a TF where the influence of both models is present.
How can we predict a crash caused by a robot error in May 2010 (that's what everyone has come to believe) and the euro collapsed more than 1000 (!) pips, or a crash caused by the franc's behaviour in January?
A crash is a crash because it is EXTREMELY unexpected! :)
I read somewhere on a forum, about a hedge fund that shut down. The reason was HFT trading.
When HFT offices have the opportunity to have an advantage for some milliseconds.
Theoretically you could assume if they can see the depth of the cup and with a small volume
take a bite out of the market for a guaranteed profit. Going back to the story of that hedge fund, I found a video about its history. There was a story of a trader from another fund. The story was told that at a certain moment the market became empty and the teller explained that he hadn't understood the market after that. Generally, it was argued that theHFTmade it much harder to make money in the market.
Like Ray Bradbury's story about the butterfly that flapped its wings in the past, drastically changing the future.
So then think that people who find strategies that work and use them change the future.
Thereby changing the structure of the market, based on so-called self-fulfilling prophecies.
From the fact that a 1000.0 pips drop in an hour is a "mosquito bite" for you, I deduce the size of your open positions, and therefore the size of your profits. For that profit to be tangible you need to have millions.
Unfortunately, I'm not familiar with the term "high-dividend slow-moving stock". Therefore I don't understand what you mean.
Eight pages and you're done?
It's all settled, isn't it?
That's unfortunate.