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Arbitrage

Nasdaq Daily Reversal — Arbitrage & Sectorial RotationAmidst a financial market strongly distorted by the thirst of control from the central banks & their monetary policy craze headed exclusively toward supporting inflating assets valuation, it's become more & more obvious prices no longer represent neither economic reality nor actual asset value (assuming they ever did). Therefore, in such a climate of financial & speculative assets hyperinflation, it's highly interesting not to be too directional, on major indexes as an exemple, and rather seek arbitrage trading between different sectors. Today i'm proposing a Daily Nasdaq reversal short, within the aforementioned framework of arbitrage, as a hedge-trade against the Dow Jones, Tech vs Industrials . Let's have a look at the Nasdaq/Dow Daily spread-chart FX:NAS100/FX:US30*100 (the *100 in the mnemonic was added to obtain more detailed «Volume profile» data / rows) : As you can see, the spread between the two sectors has been ranging since summer of last year, showcasing clear arbitrage strategies being put in place between the two assets / indexes. Strategies that were most likely triggered as a result of widespread doubt amongst market professionals about global assets' valuation and their direction. Now addressing the technicalities of our spread, it should be noted that, on that specific timeframe, we've already broken the range' support during early of March. The spread reaching its upper pitchfork/canal boundary in conjunction with a 76,4% Fibonacci retracement right after breaking its range' support, points out toward a pretty good timing to start taking action on the components of spread itself. We can also witness a few enticing overload signals on the momentum/sinewave indicators, but signals on spread-charts are never to be taken too seriously as they're not extremely reliable. To end with the spread-chart and contextualise a little bit more in-depth, this year long recent hedge trade on the two major U.S indexes becomes even more obvious when you switch to the Monthly timeframe, just to realize that NDX/DOW is a monthly range as well. You can also easily notice that the Daily hedge-trade strategies that have been put in place since summer 2020 coincidently happened to be taken on prices very close from the 2000 highs of the spread-chart (the year 2000 which happened to mark the end of the .com tech crazed bubble). Hesitation on a monthly top, heh. So we've got short term timing & technical elements aligning with the broader decade long context, good. Now let's take a look specifically at our Nasdaq chart to outline more relevant technical elements that are going to lead to our trade. Starting with the context : on the Monthly timeframe we can see that our beloved tech sector is no less than a bubble : a parabolic structure perpetually accelerating with increasingly ascending support trendlines, and not materializing any kind of consolidation whatsoever. It should also be mentioned that we havent finished a Monthly momentum cycle since 2012 (2010 for the Quarterly timeframe). Bubble meaning no cycle, consequently meaning a market structure' maturity excruciatingly harder to discern — that is besides the volatility burst & the chaotic range that precedes the final excess leading to the market top. A context to handle with care, to say the least. Now that we know the broader direction the market is currently taking, we can start to look at our timeframe of reference, the Daily one : Here are the different technical elements i could outline from that chart : Prices Reaching the upper boundary of both the Schiff Pitchfork & the Regular Trend Canal 88.6% Fibonacci extension hit & showing short term price slowdown 138.2% Fibonacci retracement from the last downward consolidating move, supposing a potential running or expanded flat Signals Cycle Alignement of both Sinewave & Momentum Momentum about to print an overload signal (will confirm or not depending on the next Daily closes) Momentum pointing at a possible triple divergence Would appreciate an engulfing bearish candle close on the Daily timeframe within the next few days Risk Management The invalidation on this Nasdaq Short costs 3%, therefore i won't expose more than half of my capital on this position, that way i'm risking no more than 1.5% of my capital as a speculative loss on this trade (and even less with the Dow long part incoming). Validation levels are showcased on the chart based on «footprints» (historical low volume areas found using volume profile), lower boundaries of channels / pitchfork and Fibonacci retracements. TP 2 means at most a total of 50% profits taken on the original position. The rest will be held for lower targets on the Weekly / Monthly timeframes. I'll further update this analysis as soon as the Dow Jones reaches its next supports areas (if it does so), especially since those same areas will allow me to start executing the opposite part of this hedge-trade (the long one). But that's it for now Hope this idea will inspire some of you ! Go easy on leverage and don't forget to hit the like/follow button if you feel like this post deserves it ;) Kindly, J.M.K
OANDA:NAS100USDShort
by John_Maynard_Keynes
1
Look Mom, it’s ArbitrageThis is a thought of the day kinda article. In an old episode of Seinfeld, when referring to being offered a free lift, Jerry says something like “Ah the lift, like the lure of the siren’s song. Never what is seems to be but who among us can resist.” Fast forward to trading crypto and we all see those arbitrage opps right? That quick trade, if you bought on one exchange and sold on another, could make $50 in bitcoin or even $100. Like the lure of the siren’s song? Like you, I have sat there watching it too. And at first you think ‘well this is easy’! It never is. That’s not to say arbs do not exist, but chances are the risk-free ones are pounced upon before you can blink and the risk-on ones, well they have risk. Unfortunately, there are several things that get in the way of a good-looking arb: 1. Commissions: obvious but often overlooked. Coin trades are charged a percentage, unlike the fixed dollar amounts in futures . That $50 trade, when you take into account % in and % out, is already breakeven. In futures to make $50 in an arb is gift because comms are far lower, but that’s another topic. 2. Then there is funding. If you are going to arb you need 2+ funded accounts. Even though interest rates are low, money isn’t free. That is also the opportunity cost of money, and that is… a cost. Sure, you could wait for a position to move from one account to the next, but then you have time risk. That’s not an arb trade. 3. Margin fees. If you are doing this on margin, then there are fees there too. Kraken for example chart 1-2bp per 4hours. Exchanges are not businesses not charities. There are little programs you can buy that spot arbs. Then again there are prop firms who will bank roll traders with an automated edge in the market. If you had a little arb algo, working perfectly, would you bother selling it? Nah, go to a prop shop and get funded. My time in prop firms has taught me if they are in something then the fat trades get thinner and thinner. They will also be faster and more efficient. As Gekko said in Wall Street “If you don't have enough, you can't p**s in the tall weeds with the big dogs.” That’s not a negative statement at all. It’s just one about knowing the market you trade. You don’t compete with the same strategy. You step back and trade your own. We all have our place in the market. If you are still finding your way, don't stress. We'll get there. A good example of how deep pockets approach arbs is in the book Flash Boys.
COINBASE:BTCUSD
by TheTradarien
33
Troy breakout pattern incoming. (TROY) ($TROY)Troy has just breaken its high. Massive upside incoming in this pattern. DOGE money needs somewhere to go which is a legitimate project. DeFi play TROY is a Smart Hybrid Asset Management System offering yield farming, fixed savings, a liquidity aggregator (for Binance, Huobi, OKex, Uniswap, Curve, Balancer), provider of arbitrage opportunities, etc. What is Troy Trade? Troy Trade is a global prime broker specialized in crypto trading and asset management. It provides crypto brokerage services for institutional clients and professional traders with products such as spot & margin trading, derivatives, data, custody, lending, and staking in one account. Master-level Trading Platform: One account with a single interface enables access to the aggregated liquidity of crypto exchanges. Some key functions include smart order routing, flexible account management, settlement service, and automatic risk control. Data Analytics: Empower customer’s decision making with a data matrix framework. Data categories include blockchain data, trading data, market data, social data, and media data optimized by AI and quantitative models. Brokerage Service: Competitive fee rate and order execution speed. Real-time fund transfer and settlement service. Provide margin trading and OTC services with advanced convenience. Full-stack Quantitative Solutions: Infrastructure powered by co-location service to better the performance of high-frequency trading algorithms. Offer exposure to quantitative solutions with straight-through processing, precise tick historical data, and strategy assessment systems. *What is the TROY Token? Functions as the medium of exchange in this organic network Provides workload reward of Relayer network to encourage timely and accurate updating, broadcasting, and synchronizing orders Serves as relay medium for the exchange of unconventional token trading pairs in-ring matching Acts as the trading fee unit when users call up the trading and settlement functions Means of access to features in Troy and burnt as gas fees Incentives for brokers and to reward brokers contributing to maintaining a global ecosystem
Long
by CryptocurrencyWorkingGroup
DeFi aggregator Troy lifting off NOW. ($TROY)DeFi play TROY is a Smart Hybrid Asset Management System offering yield farming, fixed savings, a liquidity aggregator (for Binance, Huobi, OKex, Uniswap, Curve, Balancer), provider of arbitrage opportunities, etc. EMA is in a healthy spot with MACD and other important indicators ready to bounce up for the next big jump. TROY softened a little on the last BTC drop but not nearly as much as others like DENT, HOLO, etc., which points to some serious momentum up. This coin hasn't had the massive jump yet that other microcaps have and it's a 10 billion coin circulation not 100 billion like HOLO and others which means a much higher target price . A few sources say whales have been accumulating. Trust the charts, not the "crowd wisdom" on this one and take your positions now... Buying information for a very accessable exchange as well as financial disclaimer in the signature. Good luck.
Long
by CryptocurrencyWorkingGroup
Bitcoin Cash and Carry 2021For years I have been talking about using futures products to LOCK IN the fiat value of Bitcoin and give investors the added bonus of collecting a return based on the arbitrage. We are once again in a big bullish cycle which is driving up the futures premiums to all time highs creating OPPORTUNITY . In the FTX:BTC1231 for instance as of writing there is a 20% arbitrage. In this video I revisit this concept for 2021 and explain how it works. See my written idea posts below for this has played out in bull cycles past.
FTX:BTCUSDEducation
by norok
8