Yes the lil guy / gal can make a success of trading....
Just recently passed a TST Combine and going to phase II next week.
Just don't get caught up in lagging indicators to tell you when to Buy / Sell
At the moment, I don't have any trading style / edge. I am in the process of developing one, and thereby I have no trading experience as well. I am still very new to this whole trading market and I am beginning to learn more and more by the day. Hoping to start analyzing market charts by next month or two.
At the moment I am trying to study and learn the basics and fundamentals so that I can understand what's going on when I start looking at the market (preferably ES, 6E, M6E, YM, CL). While I don't intend to trade in these markets all at once, I plan to analyze them all on a weekly basis.
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Even if you operate on a shorter time frame you can still play the game. As already mentioned HFT is more about market making and profiting by providing liquidity (this is how the scalpers on the floor used to operate). But you can still scalp today it just has to be done differently and with a more directional mindset.
Electronic markets have brought different kinds players in the game but the rules are still the same when it comes to how prices move up and down. So effectively we just have a different type/behaviour of price action, one that can still be read and understood albeit often more difficult. So unless you want to get into the market making side of business I wouldn't worry about HFTs, although its still important to understand their effect on the market.
IMO Trading success boils down more to how you handle yourself and your risk, not what computers are doing.
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The point here is that they are operating on a completely different time frame than you or me. They are analyzing down to the milliseconds. We are analyzing at least several minute time frames. So no, there is nothing to fear. It's like saying that day traders have access to more information and therefore are far more competitive than long term buy and hold investors who are hanging on to positions for months or years. Of course that's not true. Same thing with HFT vs. discretionary intraday trading. Two completely different methods, two completely different sets of players and competition. These guys aren't looking to compete with me and you - we are in another sport entirely. They are looking to take on the guys playing the same game as them.
On a side note, we should be very happy that they are doing their thing, because liquidity has increased enormously, and executing costs are lower. You can theoretically trade larger sizes than ever before because of these guys.
Last edited by mangolassi; July 4th, 2016 at 12:04 PM.
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Donate 1/2 of your allocated trading capital to a worthwhile cause...take the other half and walk away.
Oh and for obvious reasons don't listen to brokers who suggest that you can make it.
If you still want to stick around...prepare to be "feed" for a few years and IF you make it consider the following before you decide what to study.
Nearly every trader has the market moving a few ticks against their entry 90% of the time before it continues in the intended trade direction even of the winning trades...who's taking that $? Your losing trades are extra bonus
HFT isn't on a different time frame,they're in all time frames...just a different thought process.
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