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Thursday’s Price Action Was Just A Preview…

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JULY 31, 2023
 
   
GUY COHEN’S TRADE RADAR
The First Shockwave Hit Thursday.
 
 
 

Over the last couple of weeks I’ve mentioned the Magnificent 7 tech stocks need to report their earnings and then the likelihood of a pullback increases significantly.

Thursday’s action only reinforced that view. Four of the seven have reported. Apple and Amazon announce this week — then Nvidia on August 23rd.

I’m not totally clear WHEN the pullback will happen, but that it will happen  — and quite soon — is something I AM confident about.

By now I hope you’re seeing the beauty of our method, combining broader structures (Shrinking Retracements) with leveraged position-building activity (the OVI) and more micro structures (price/volume/Key Levels) to form a cohesive strategy to trade consistently.

Watch today’s video to see just how powerful and quick this technique is with my unique tools.

 

Follow the money,

— Guy Cohen

 
JEFFRY TURNMIRE
The Achilles' Heel: Dissecting the Vulnerabilities of Wall Street's Trading Bots
 

The world of finance isn't as human as it once was. These days, Wall Street is an orchestra of algorithmic trading bots, executing trades at near light speed. 

While these automated traders are highly efficient and immune to human emotions, they are far from perfect. Despite their sophistication, they've made errors that have sent ripples across the market.

Let's take a dive into three instances where the bots dropped the ball.

The Knight Capital Group Incident

On August 1, 2012, an erroneous algorithm deployed by Knight Capital Group caused a flurry of unintended trades, leading to a staggering loss of $440 million in just 45 minutes. This glitch resulted from a software update that triggered millions of flawed trades, leading to Knight Capital's eventual collapse.

Facebook IPO Fiasco

When Facebook went public in May 2012, high demand and trading volume put the NASDAQ’s system to the test. The result wasn’t pretty. A design flaw in the system couldn't handle the trading rush, causing order cancellations and modifications to fail. This led to a chaotic opening and delayed confirmations, inflicting losses on traders who couldn't execute trades at desired prices.

Swiss Franc Shockwave

In January 2015, the Swiss National Bank unexpectedly announced that it would no longer hold the Swiss Franc at a fixed exchange rate with the Euro. Algorithmic trading systems, unprepared for such a move, couldn't adapt swiftly, leading to rapid, volatile shifts in currency markets. Some foreign exchange brokers suffered severe losses as their bots blindly followed pre-set trading rules.

These incidents demonstrate how Wall Street’s trading algorithms can be a double-edged sword. On one hand, bots offer incredible speed and precision. On the other, they lack the ability to interpret unforeseen events or adjust strategies in real-time like a human would.

In fact, I think I’ve discovered a flaw in Wall Street’s bots that cause a certain ticker — when specific circumstances are met — to have a “misprint” on some of its options.

And I’ve been exploiting this flaw for over a year with a perfect 52-0 track record.

I just went live earlier today to talk about it. If you want to learn more, including how you can start exploiting this flaw for yourself, click here to watch the video.

— Jeffry Turnmire
   
 

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