Why the majority is always wrong
thanks to TED.com
Model Training Update
The model needs training. The training tools have been deeply revised. In the beginning the training was done by hand (!). Then a simple tool interfaced the operations, still giving space to errors and inaccuracies. Now the training tool has become a complete “position manager”. I have in mind to call it R.Virgeel, but…
The Lazy Investor and A.I.
Artificial intelligence is for lazy investors and this for two orders of reasons: it reduces the frequency of trading actions and it relieves you from the necessity of having an opinion. Any of our action requires an opinion and, in trading, our opinions are, usually, like TNT in the hands of a chimp. It’s a…
Artificial Intelligence is different
Trading is one of the easiest activities around: few seconds and you are in position, few seconds and you are out of your position. Making it profitable is a totally different discourse. Libraries are plenty of technical and fundamental analysis books and the internet is plenty of websites that offer amazing returns. All of them…
Artificial Intelligence core explained
It’s not my aim to explain how Artificial Intelligence works and I never tried to, just sometimes I’ve discussed the media approach on the topic. I’ve seen this video and it explains quite well how the core of this technology works. We are speaking about back-propagation neural network, the pattern recognition engine that works at…
The Dark Side of the Spreadsheet
I have read the following https://www.technologyreview.com/s/604087/the-dark-secret-at-the-heart-of-ai/ and, again, I thought about the misinterpretation that Artificial Intelligence is going through. Do your remember Visicalc? Probably not. Visicalc was the first spreadsheet, 20 rows by 5 column (!) by Dan Bricklin with Bob Frankston. It was 1978. The Spreadsheet! The tools that makes the world go around……
Do we need Artificial Intelligence?
I’m wandering: do we need Artificial Intelligence to recognize that we are in a bull market? When you are inside a trend, corrections are our friends and the fear of the top (or bottom) is our recurrent trouble. But, surfing is easy with a trendy market. Stay hungry, stay long.
Artificial Intelligence vs. Natural Stupidity
I imagine that many readers interested in the Artificial Intelligence topic are getting used to a very romantic view of the argument. The majority of the articles you may read present anxious questions about a technocratic future generated and managed by AI driven machines. Is this wrong? Not at all, but this is the romantic…
The hidden disorder of the market
Often, you read someone that has the key of the “hidden order” of the markets and is so kind and altruist to share such a knowledge with you. Can you trust? Can you believe? In my opinion, after years of testing and developing the artificial intelligence model that powers this site, there is no hidden…
Does this stock market scares you?
I read an article today that highlights the fact that a lot of investors are scared by this current stock market. The stock market is moving opposite to almost any prevision made by mainstream media, it should have crashed after Trump election or Brexit, and instead it is rising madly and without rest. All this rises confusion…
Never seen before
In the rising market, you are continuously convinced that a crash is imminent and this is the fuel that makes the market grow, having a lot of people on the wrong side. We are watching it in the latest months, whenever the downturn seems inevitable, the market turns up blindly, no way. If I should…
Two is better than one
Time to update about the development. The alternative weekly model is under alfa testing and should need data to feed it. It has grown to a complete new model, even if it has not yet a name: maybe A1model. Or Bmodel. It has not yet a different personality, it just replicate the Amodel with some…
Noise
Noise is everywhere. We could even argue that trends are made out of noise. Inside massive markets, volatility can be your worst enemy: psychology again comes on stage. Every turn in the price creates uncertainty and uncertainty accumulates. Our confusion grows. It’s difficult to make correct investment decisions and timing when in confusion. If…
Two or three words on risk
For the trader or the investor, the word risk is one of the principal keywords. Nobody knows what risk really is, so relax. On the other side, everybody knows what risk means: as animals, we continuously react to external stresses under a risk based strategy, intended to minimize the possible negative consequences. It’s something…
Sharper, sharper we go
Latest days were hard. I do not mean bad, but hard. It was evident that the model was in crisis. Maybe the fact that the market is going into a never seen territory, or maybe due to its internal conditions, actually I’m not sure of the cause, but I was aware of the disrupted path…
Introduction to money self management
This is the first of a series of posts dedicated to individuals interested in investing and trading, but without experience, where I try to explain the basics of money self management. A lot of people is intimidated by any discourse about money, for various reasons the first being the total lack of formation and experience.…
Trading opinions
Every trader and investor has her/his own framework of opinions that pilot the triggers. It is a mix of experience, knowledge and emotions. As your decisions are worth a gain, you have an euphorical sensation that you are mastering the forces that drive the market, but on the other side if your decisions take you…
New attitude for new market
It is almost one year that the spxbot.com site is on and three and a half years since I begun developing the model. Well, many previous experiences have built the necessary skills, but this is the timing. No, it’s not time to draw conclusions, the work is still going on – will it ever last?…
Forecast performance and position statistics
I perfectly understand that my readers ask for backtesting and performance statistics of the model. Let me explain, it is natural as most of you are trained in technical analysis and are used to manage tools that have as their main feature to let you scan it retroactively. It’a one dimensional analysis. Here, I don’t…
No divinations
I’m always here to show something obscure coming in from the future, but today I’d like to to just fix a point in the present. No divinations. The chart is speaking. This is a CFD continuous chart daily bars of S&P 500 index. We know the market is discounting a crucial event in less the…
To know in advance
On 23rd of September the model has produced this forecast. It was Friday, and usually as the week closes the model is sharper in viewing into the future. As well as it seems that Thursday forecasts are the weaker, and here I just guess an interpretation: Thursday reflects all the noise accumulated during the week,…
Some data about model performance
I’m sure that my (few) readers are curious of one thing: how the system has performed? percentage, percentage… I can’t blame you, even if I’m not very excited by past performance of any system. Performance percentages let’s you dream and are very dangerous 😉 But this is not a technical analysis automation or an algorithmic trader…
The model and COT
You may wonder if does the model contains data from the COMMITMENTS OF TRADERS weekly data? No, the COT data (a report published every Friday by the Commodity Futures Trading Commission, that disaggregate the open interest of future contracts) is not part of the weekly model because, after a long experimentation, it resulted completely irrelevant.…
Cassandra was hated by her fellow citizens
“Actually, I’m surprised that there aren’t more sites like SPXBOT out there”, he writes to me. No doubt, it is one of the best compliments I’ve received so far. Yes, it was not easy to build the system: programming, trading experience, and a lot of time were the the main ingredients. Consider that what I…