Saturday, February 5, 2011

Joe Saluzzi with Chris Martenson on HFT

Saluzzi confirms it is not a stock market any more, and carbon-based traders have no chance, and that technical patterns, which have worked for years and years, don't work any more.

The last one, that TA doesn't work any more, is what you suspect but don't want to admit. Looking at the market indices keep on levitating on ghastly volume, or certain momo Naz stocks just keep bid up no matter what, I've long admitted that is the case. I almost have a pity for people like Q-man who seems to earnestly believe everything is expressed in the charts and that most traders are still carbon-based, and who never even mentions HFT.

About the only aspect of TA which has seemed to sort of work in indicating the market turn is positive/negative divergence on some technical indicators - RSI, CCI, MACD, MACD histogram. But even that seems only allowed to work for a select set of stocks like gold and silver related ETFs and stocks (for obvious reasons - JPM, HSBC, Ben at the Fed...).

Here's the link to the podcast;

and the link to the transcript of the interview.

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