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Microsoft Corporation Message Board

  • hawcreek12 hawcreek12 Apr 4, 2013 1:01 PM Flag

    Low volume bot trading explained for CFury


    Probably 80% of trading is done by automation these days which could be a positive but without some emotion and normal fear there is also a greater risk.

    Many bots are apparently set to buy or sell on price alone. I.e. the program updates the 50 dma and the bot holds unless that is broken so as long as Ben pumps the 50 day MA rises and the volume is low. Meanwhile the hedgies pump up issues in the morning and feed them out during the day to retail.

    The danger is any event that tells the bots to exit, or even a foreign power hacking the system because sells too big to pump will trigger more sells and the manipulation bots who are pretending they are doing the job of the floor specialists of yesteryear will not do that job to support price.

    Ultimately the market is much bigger than Bernanke.

    As a young I wanted to board a barge that was sitting in a back bay. There was zero wind and no current but the barge was laying offshore about 8 feet. I put a foot on a mooring line and balanced on a bollard and the line and with 200 pounds I moved a 250 ton barge (eventually).

    In a near neutral or slightly negative situation a little can move a lot, but given even a half mile per hour breeze I would not have been able to budge that barge.

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