TLC Weekly Update January 29, 2021

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Today is last trading day of January. While I am writing this the trading day has not ended yet but what a fight between the bulls and the bears. What many people do not realize is that brokerage firms almost always want January to close positively so that they can lure the investors into doing some business with them. i.e. the January effect.

The line in the sand is the 2020 year close. All morning S&P500 was trying to defend that price but failed to do so by lunch hour. I wonder if they will succeed later today?

I came across this video talking about “negative ion” products. Make sure you check it out to avoid these items because they can inflict serious harm. I am glad that I came across the video because I am a sucker at trying out novel health products …

For those of you who wonder why we experienced the GameStop fever and started to question whether stock market is functional, check this video out. Mr. Meldrum provided the most complete explanation of what happened to these fever stocks. I like to add that the selling of orderflow data by firms like Robinhood to HFT firms also add to the mess.

However, it is not something new at all. At the end, it is always those who board the train unprepared will be hurt the most. So know what kind of game you are getting into before jumping in.

Watch this video from CNBC on Chamath Palihapitiya’s take on the whole fiasco.

I am working on so many things lately it feels like I am running out of time everyday. Maybe I can slow down a bit once I resolve several technical issues with my automated trading. I will definitely write about that for my daytradingbias.com premium members because it is a very serious issue that can affect their trading.

Some readers keep asking for an update of the Big Game Hunter ES performance. I have downloaded the statements and have someone taking care of the performance summary. I will post it in the company blog later today.

I guess that’s it for the week.

Have a great weekend all!

TLC Weekly Update January 8, 2021

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US electoral dispute is now over. But we are left with more questions than answers on the future of United States. Given how ugly this 2020 election has become, I can’t imagine what will happen by mid term 2022 …

Luckily I am just a Canadian. Canada being such an unimportant country, its political dramas do not lead to any meaningful impact on the world. This makes me feel much better during our elections.

Here is an older article about human brain’s approach to process sensory information. The article came out back in Oct 2019. This understanding of the human brain has helped computer scientists to breakthrough many of their problems in AI last year. So not everything happening last year was bad.

For some mysterious reason, youtube chose to put this on my front page. It turns out to be a charming video that I watched years ago.

I forgot to mention that I finally stopped my 20+ years habit of writing down notes on notepads some 2-3 weeks ago. I took the leap of faith to replace my written notepads with Samsung Galaxy Tab S6 Lite. It takes some adjustments to my routine but I can tell you after 2 weeks of notes taking on the tablet, I will never go back to pen and paper.

I chose this tablet over other options because of the included software for notes taking is better than ipad and ipad pro. I can now easily include clips by taking a picture using the tablet, or taking a screenshot from the browser. But most important of all, I no longer need to find space to store even more notepads.

I picked up a Rubik’s cube over the holiday with the intention to practice my cube solving skill. Then I found this on youtube. I want that cube!

I was asked by many friends about my year 2021 outlook. I will summarize the main points here. Some are technical view based on market data. Some are astrology based projections. And some are just wild imaginations. Consider this a mocking of all the predictions people made for 2021.

  • shortage of food and essentials
  • worldwide cargo transportation cost going much higher
  • interest rate goes up
  • civil unrest everywhere
  • a real pandemic will arrive that reduce global population by 10%
  • major earth quake happening somewhere
  • aliens finally public broadcast their existence among us
  • gold to crash 50% in a year or two
  • bitcoin to crash 80% in a year or two
  • aliens giving us warp drive and unlimited energy technology

Have a great weekend all!

TLC Weekly Update December 18, 2020

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Last option expiration week of the year is now finally over. The rest of the year are filled with holidays so majority of the traders will not be trading. I wonder how many trading bots are aware of this and avoid trading too.

The other day my son showed me a game he’s playing online. It is a form of tower defense with several twists to make it appealing to gamers. Similar to all the other latest online games, it is free to play with extra items that one can pay for. I ended up digging out some old research on the economics of these games which explained that they make money by exploiting a form of human defect. Interesting.

In the spirit of the holiday season, here is a video on an animal letter opener.

One of the most messed up political drama this year is definitely Brexit agreement negotiation. Seriously, just watch this video and you will understand completely why there can never be any progress with the Brexit negotiation. Yet another example of politicians love wasting other people’s money …

It is time for me to slow down a bit, do some planning for next year and find inspirations from leisure reading.

Have a great weekend all!

TLC Weekly Update December 4, 2020

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This Non-Farm Payroll (NFP) week has surprised many people who keep talking about how overpriced the stock market is while all week the market just levitated to stay near all time high. Can’t blame them. Normal people, which include majority of the traders, do not pay attention to the obvious bullish biases during NFP weeks. It is a good thing for those who are aware of it and act on it.

Holiday season now in force so trading volume should be reduced somewhat. However, given the uncertainty of the US election still hanging around, I don’t know if the traditional Christmas rally can happen in a normal way like the past. Well, what’s normal this year at all?

Interesting read about the Donut King, there are lessons we can all learn from this story. From rags to riches once we all heard of but twice, makes it all more interesting.

This touching story about old couples who have to face the hard decision to send their loved ones to nursing home or palliative care is a problem many of us have to face eventually. From my personal experience and also shared knowledge from close friends, it gets harder if you are old and frail yourself as the caregiver. It is important to ask for help when you are exhausted and feeling hopeless.

I came across an interesting video talking about the discovery of how Ancient Egyptian sounds like. I wonder if they really got it right, or, like what most economists do, that everything they do are just pure guessing.

Here in Toronto the lockdown has escalated and a new trend has emerged. People are moving to houses in small towns outside of Toronto. It is like a mass exodus thanks to the technology we have available nowadays making it possible to work from home. These small town house prices have skyrocketed some 15-20% in a few short months while Toronto downtown core condo prices dropped 10-15% overall. This is a price shock event that will take time to absorb.

I reached a major milestone with my trading venture for which the automated day trading model I envisioned some two years ago is now mostly completed. It covers about 80% of the strategies I deem important. Looking back, if I did not made the decision to aim higher, this would never happen. Doing this while the stock markets going through its craziest time was a tough challenge. It also makes it much more satisfying.

For my trading venture, having the first model completed is just the first step, although a very important step. From here my team will have to expand on what I have accomplished and expand the research and development work across many more markets. It will be even more challenging when we start to tackle markets we are not familiar with. Can’t wait to see what we will accomplish in year 2021!

Have a great weekend all!

TLC Weekly Update November 20, 2020

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Another week that the stock market flirting with all time high yet not quite able to stay that way. More vaccine news but not good enough to offset the other pressing issues. Traders should be happy that next week is Thanksgiving week. Traditionally, pro traders who are doing fine up to this point for the year would wind down their trading and take a break all week. Let’s see if trading volume will drop like the past this coming week.

I have been reading books and studying history to try to get a better perspective of the current global situation. It feels like we are going to see drastic changes in coming few years as the post COVID era is getting very chaotic already. It is important to figure out what to do and prepare for this “interesting time”.

I came across some amusing reads that has nothing to do with the big picture though.

For example, this one on the birth of chaos theory and this other article on Olive Oatman the pioneer girl are good read.

During this holiday week, would you be interested in trying the sport of egg boxing? I find this quite funny since we can never guess what people do with their spare time …

Lately, I have this burst of creativity that keeps me going 12-14 hours a day working on my projects. Very good progress is made and I am happy for that. Hopefully this can last long enough so that I can complete several projects before the end of this year.

Have a great weekend all!

Happy Thanksgiving Week to my US readers!

TLC Weekly Update November 13, 2020

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Today is Friday the 13th. Famous for handing out chaos and troubles. Well, the whole week was a mess for the financial markets thanks to Pfizer’s vaccine announcement spiked the stock markets much higher. And then everyone learnt that its CEO filed to unload most of his holdings of the company. Talking about sarcasms …

With the hanging issue of US election, everyone I talked to are as confused as I am about the near term outlook of the financial markets. A weekend break is much needed to reflect on all these latest developments. Some friends of mind are talking about using psychedelics this weekend to clear their minds. For those of you interested in New Age stuff, here is a piece on DMT trip … interesting I must say.

And for astrology fans, or just astronomy enthusiasts, the last Jupiter Pluto conjunction in this year just happened on Nov 12th. It will not happen again until Feb 4, 2033. That’s 13 years away. I am not sure what this signify. I hope, though, that it implies COVID-19 is over.

Someone sent this video to me on making a simple toy. This can be a fun project for kids and adults alike. Enjoy!

I am kind of re-reading a book I have. “Kind of” because it is a different edition. The book is The Most Important Thing Illuminated by Howard Marks. This edition has additional comments from other people and the author himself. It is a great book for anyone interested in longer term investing.

So much work to get done before the year end. I guess no holiday break for me this year.

Have a nice weekend all!

TLC Weekly Update November 6, 2020

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US election was over but the messy process of getting a US president for the next term has just started. Hopefully my prediction, that it will take years to resolve the issue, is wrong. Some people suggest that US should really be split into two countries instead of one since the votes are so distinctly divided at 50/50 level. They may have a point.

I have an extremely productive week. Multiple issues with deploying automated trading strategies are resolved. New strategy development effort has achieved great progress. Since travel around the world is still quite troublesome, looks like I will stay in Toronto doing R&D all the way into end of this year.

I grew up playing 2D fighting games. And I am pretty bad at it. Somehow I watched this video on the Tekken 7 world championship final. Amazing precision and control. How do they do that?

Just a fun video on the fastest robot solving a Rubik’s cube.

It is disappointing to see US sinking into chaos. Once upon a time, it was safe to send your children by US postal. What went so wrong that this once superpower of the world has turned into a disgrace?

I guess politics is really not my thing. Better focus on my trading.

Have a great weekend all!

TLC Weekly Update October 23, 2020

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Finally, the last US presidential debate is over. Now we just have to sit tight and wait for the outcome by election day. For traders everywhere, hopefully there will be a slow down of random news shock from the two camps. Giving the world a break until the results are in on election day would be nice. I am sure more chaos will follow after the election though …

Bitcoins is on the move again and the crypto traders are getting all excited about it. Although I don’t hold a lot of BTC anymore, it is nice to see more and more famous financial gurus willing to bet on the concept. The latest being Paul Tudor Jones. What he says 5 months ago and what he says yesterday. Of course, he is talking his book because he just bet $100 million (I can be wrong on the figure) on BTC in the beginning of the year.

Read a story about the old Nintendo NES Zapper. It is so interesting to see how game developers managed to overcome the hardware limitations back then. Since I have not played console games for a long long time, I wonder what kind of technology the current generation of shooting games uses for better gaming experience.

I encounter this question pretty much every week in random conversations all the time, “Why do people fail at trading?” All those “gurus” out there giving their personal accounts of determination and perseverance needed to win the game are pure bullshit. Some of them are the lucky ones belonging to the 4% I explained here, the rest are fake gurus who copy the answers from the others on the internet. Here is another take on the issue based on our physiology and that’s why I told everyone that they have to be awaken first before they stand a chance.

To be awaken is a process. High level of awareness is needed for anyone who want to accomplish real mastery in anything. It is a very easy task to do if you choose to practice awareness deliberately. The hard part is making it your second nature or making it effortless. Since majority of the population refuses to do anything that gives them a sense of defeat, thus people with high level awareness is very rare.

For those of you who really want to improve your awareness but lack the guidance, you can start with something easier to digest, like, The Subtle Art of Not Giving a F*ck, so that you have some background understanding about human minds. From there you can progress to learn basic breathing techniques to control your mind. Once a slightly better foundation is built, you can then learn to observe yourself.

Just like anything that worth pursuing, you must be willing to transform yourself in order to stay the course.

Have a great weekend all!

TLC Weekly Update October 16, 2020

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This was option expiration week but then thanks to the way Softbank and its copycats cornering the stock market like no tomorrow, the option market makers have no choice but to accept defeat. Many gurus out there keep saying the stock market is not following the reality of the real economy. I have a slightly different take on the detachment of correlation though – underneath the major indices, only a handful of stocks are driving the indices to all time high while majority of the other components have not recovered like the real economies around the world. The stock markets are reflecting the reality – that only a handful of companies benefited from the situation.

Interesting read about the energy efficiency of computing. CPU overheat is something that affect computer performance ever since they were created. It looks like we finally learn more about this issue over the past several years that can contribute to major breakthrough in computer performance.

Scary tell from Loy Machedo in this YouTube video. Young people who are fortunate enough to grow up in the better parts of the world should know about the reality out there. The world is full of dark corners and the willingness to pay attention to these issues can help you develop a proper perspective of the world we are living in.

For the programmer readers, here is a long read about Amazon’s epic failure at cracking the online game industry. Sometimes, doing everything in-house just because you can afford it may lead to massive waste of resources and failure to deliver anything of significance. The same problem persists with majority of the aspiring traders who think they can afford to lose enough money to hack their way to trading success …

I have so much work to catch up with so I will wrap up here.

Have a great weekend all!

TLC Weekly Update October 2, 2020

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First debate of three scheduled just took place this Tuesday and we already have a taste of what is coming up. I wonder if the viewership would drop over time though as there is really nothing new or useful being discussed. Unless, of course, some super juicy conspiracy facts are exposed in coming weeks …

And now Trump declared that he tested positive with COVID, the plot thicken with even more uncertainties in coming weeks. How the stock market will react to this can be complicated because no one knows the outcome.

Someone referred me to this short video of Hugh Jackman being interviewed by an YouTuber. Either the youtuber has made a serious impression from the past, or that Hugh Jackman has a very good memory. I will let you decide.

I was asked lately by a number of people about the importance of statistics in trading. My point of view is that, before one even talk about statistics, they need to understand the difference between frequentist and Bayesian approaches. The two camps lead to distinctly different way to formulate their conjectures and inference methods. I personally do not believe that the frequentist approach works with trading and it is proven by Nassim Taleb that financial markets are all fattail animals. Here is a good short piece on the subject.

And having the correct understanding of Bayesian inference, is all more important in this post COVID world. Check out this video from Veritasium on the subject. It can help those of you who are so influenced by the reporting of daily cases to calm down and rethink about the whole situation.

Coming week I will be extremely pre-occupied by all kinds of paperwork and business chores. Better get things started now.

Have a nice weekend all!

p.s. belated Happy Mid-Autumn Festival to all of you who celebrate the occasion!