Trading – General


Working with the Current Hectic Market Environment – Update 2

During the past 2 weeks of extreme market actions across virtually all markets (stocks, commodities, forex, bonds, etc.), we’ve notice that time lag is experienced on all real-time data services. During the extreme market actions, the time a tick arrives at NeoTicker comparing to the time of the computer clock lags from 5 seconds to 15 seconds.

Based on our observation, when such delay happens, it does not matter you are tracking 100 symbols or less, or that you are tracking 1000 symbols. It just happens. Thus the root of the issue could be one or more of the following reasons,

1. Capacity max out at the data vendor’s servers
2. Overall internet traffic is flooded
3. The specific path way your internet connection to your data services is choked with too much data

In a situation like that, we’ve found brokerages that sends only timer based updates on current quotes can keep you informed of the latest prices. That can help you better gauge the current price level on the markets you trade.

At our end, we will try to add some new features in NeoTicker to inform the users when such condition happens, so that they are better prepared.

Working with the Current Hectic Market Environment – Update

Working with the Current Hectic Market Environment


Explosion in Emini S&P Trade Volume


The table is showing the average number of trades per day in January over 5 year period. Back in 2004 and 2005, the average was around 90K and then decreased to around 50K in the following 2 years. This year, however, we have witness the biggest increase in emini trading activities.

What does this mean to you? Check out this article and be prepared.


CME Limit Down Levels on Various Index Futures

Here is a link to CME updated 2008 first quarter price limit guide.

If you trade emini ES, NQ, YM, etc. please read the guide line and understand the procedures. There has been no limit down events for several years and only one single limit down event on NQ in 2007. Make sure you know the implications.


Attention Mini-Size Dow Future Traders

We received multiple updates from various data vendors that the mini-size Dow future (i.e. YM) will no longer be available without exchange fees. To complicate things further, YM will move to the globex platform during Jan-Feb period, making it unclear which exchange (CME or CBOT) should a trader subscribe to in order to receive the necessary real-time data.

Please check with your data vendor to find out what you have to do to continue receiving real-time YM data without disruption.


Post Hectic Environment Period

After the turbulent period of June to mid-August 2007, as mentioned in the previous article, the explosive growth in real-time data has retreated some what. Here is an update about the current situation.
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Working with the Current Hectic Market Environment

The trading environment since the beginning of May has been very different from most of the summers I have seen. Here are some tips to ensure your trading goes as smoothly as it can be.
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The Black Swan

The Black Swan: The Impact of the Highly Improbable written by Nassim Nicholas Taleb is an interesting book. One of the claims in the book talks about the return of the Dow Jones Industrial Average will be cut by half if a limited number of days (the ones with biggest gain) are removed from the data series. I have created an interesting chart with variations of the idea for your enjoyment.
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Early Roll Over for US Index Futures

Just a reminder that tomorrow is the roll over day for various index futures traded in United States.
e.g. S&P, Nasdaq 100, Dow, Emini SP, Emini NQ, Mini Dow, etc.

The front month contract will switch from December 2006 to March 2007.


Using Trendline and Trend Channel

Many beginner traders have seen trendlines, but not many of them know how to draw trendlines properly. On the other hand, there are even less number of traders know what trend channel is.

I am no expert in trendline or trend channel usages – most of my knowledge about these tools came from my mentors and real life experience. I am going to talk about some basic concepts in using trendlines and trend channels that can help beginners to better understand these two useful technical tools.

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Interesting Expiration Month for E-Minis

The expiration date for the various e-mini index future products like e-mini SP, NQ, ER2, etc. will be 15th of this month. The more important date, however, is tomorrow, September 7.

By tomorrow, most data feeds and brokerages will switch to the December contracts for their continuous symbols and for general order placements.

This switching date is earlier than most expirations that usually occur during the middle of the month.

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