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Discretionary

Algorithmic vs. Quantitative Trading: Which Path Should You TakeI’ve always wondered why anyone would stick to traditional trading methods when algorithms and mathematical models could do all the heavy lifting. I started questioning everything: • Why do so many mentors still swear by discretionary trading when algorithms could handle all the heavy lifting? • Do they really have solid proof of their “own” success, or is it just talk? • Or are they keeping things complex and discretionary on purpose, to confuse people and keep them as members longer? • Why deal with the stress of emotions and decisions when an algorithm can take care of it all? • Imagine how much further ahead you could be if you stopped wasting time on manual trades and instead focused on market research and developing your own models. When I first got into trading, I thought Algorithmic Trading and Quantitative Trading were basically the same thing. But as I dug deeper, I realized they’re two completely different worlds. Algorithmic Trading: It’s simple – you set the rules and the algorithm executes the trades. No more sitting in front of the screen “controlling your emotions” and trying to manage every little detail. Instead, you let the algorithm handle it, based on the rules you’ve set. It frees up your time to focus on other things rather than staring at price charts all day. But here’s the thing – it’s not perfect. You’ll still need to test the rules to make sure the data and results you’re getting aren’t overfitted or just random. Quantitative Trading: A whole different level. It’s not just about executing trades; it’s about understanding the data and math behind market movements. You analyze historical price, economic, and political data, using math and machine learning to predict the future. But it can be complex – techniques like Deep Learning can turn it into a serious challenge. The upside? This is the most reliable way to trade, and it’s exactly what over 80% of hedge funds do. They rely on quant models to minimize risk and to outperform the market. So, which path should you choose? Quantitative Trading can feel overwhelming at first, I recommend starting with the basics. Begin with Pine Script coding in TradingView—start building a foundation with simple strategies and indicators. As you grow more confident, start coding your own ideas into rules and refining your approach to eventually automated your trading strategy. TradingView is a great tool for this, and I’d highly suggest grabbing the Premium plan. This will give you access to more data and features to make your learning journey smoother. Dive into the Pine Script documentation , and begin bringing your ideas to life. I promise, the more you focus on this, the better and more independent you’ll become in trading. Every day, aim to get just 1% better. To Your success, Moein
COINBASE:ETHUSDEducation
by Fractalyst
1
Is Amazon stock trapping retail traders? Is it too late?Historically, Amazon tends to experience a run-up leading into Prime Day, which could add positive momentum to the stock. There are some indications that history might, in fact, repeat itself. The yellow line represents the 6-month anchored VWAP, while the white line shows the July highs anchored VWAP. These VWAPs are crucial as they provide a strong indication of where average buying and selling have occurred over significant time frames, acting as dynamic support or resistance levels. I anticipate strong resistance near the August highs, as this is a level where increased supply could enter the market. To counter this, I am hoping for a tight consolidation or base formation in the $183.22 - $187.50 range, setting up for a powerful upside move. If the price can hold within this range, it could pave the way for a retest of the August high and potentially push further up towards $200 by the end of the year.
NASDAQ:AMZNLong
by MysticMads
MACRO MONDAY 28 ~ Discretionary Index Vs Staples IndexMacro Monday 28 – Discretionary Vs Staples Today we are going to look at the following two very interesting SPDR Indexes and their relationship to one another to help us understand where the U.S. consumer is at present. SPDR Select Sector Funds (“SPDE SSF”) 1. Consumer Discretionary SPDR Fund AMEX:XLY 2. Consumer Staples SPDR Fund AMEX:XLP For reference the SPDR (AKA the Spider) is a short form name for a “Standard & Poor's Depository Receipt”, an exchange-traded fund (ETF) managed by State Street Global Advisors that tracks the Standard & Poor's 500 index CBOE:SPX What are Discretionary Expenses? Discretionary expenses are defined as “a cost that a business or household can survive without, if necessary”. These are the nonessentials like meals at restaurants, entertainment costs, vacations and 50” flat screen TV’s. What’s in the SPDR Consumer Discretionary Index? The SPDR Consumer Discretionary Index seeks to provide focused exposure to companies that provide discretionary nonessential services or produces such as hotels, restaurants and leisure; textiles, apparel and luxury goods; household durables; automobiles; automobile components; distributors; leisure products; and diversified consumer services. The SPDR Consumer Discretionary Index top 10 holdings are: 1. Amazon 22.62% 2. Tesla 17.76% 3. McDonalds 4.63% 4. Home Depot 4.58% 5. Nike 3.80% 6. Lowes Cos 3.70% 7. Booking 3.62% 8. Starbucks Corp 3.24% 9. TJX Companies 3.22% 10. Chipotle 1.85% Now we understand exactly what the SPDR Consumer Discretionary Index is and what its main components are. We know that the index itself is driven by stock prices from a collection of companies that offer discretionary services and products in the U.S. Now lets have a look at the SPDR Consumer Discretionary Chart Chart 1 – SPDR Consumer Discretionary - AMEX:XLY At a glance the chart demonstrates the following: ▫️ In December 2007 price fell below the 200 Week Moving Average (WMA) which coincided with the exact date the Great Financial Crisis commenced (from Dec 2007 – June 2009). ▫️ Interestingly price got back above the 200 WMA in February 2010, 8 months after the recession had ended. ▫️ Since 2009 Consumer Discretionary spending appears to be in a general up trend with a lot of volatility in recent years however still in an uptrend. ▫️ The 200 WMA is still rising and sloping upwards, and price is now back above it which indicates strength. ▫️ Recently we made a potential lower higher and this is something we should look to confirm over the coming months. Should we break higher this would be obviously bullish, another lower high and we know to be cautious. ▫️ In the event we breach the 200 WMA, we should start to get more cautious. This has occurred twice since 2020 and price got back above the 200 WMA however we are very aware that a breach of the 200 WMA can signal a recession as it did so accurately in Dec 2007. ▫️ If we fall below the “INITIAL SUPPORT” marked on the chart, consider this an initial serious warning. ▫️ If we breach the “MUST HOLD SUPPORT” this would be extremely bearish. - you will see that volatility to the downside on Consumer Discretionary can be quiet something in our comparison charts below. It is worth noting the level of increased volatility since 2018 on the chart. We have not really seen anything like it before dating back to 1998. Lets move onto the Consumer Staples and see what they are, what they consist of and what the chart is telling us here. What are Staples? The term consumer staples refers to a set of essential products used by consumers. This category includes things like foods and beverages, household goods, and hygiene products as well as alcohol and tobacco. These goods are those products that people are unable—or unwilling—to cut out of their budgets regardless of their financial situation. What’s in the SPDR Consumer Staples Index? The SPDR Consumer Staples Index seeks to provide a focused exposure to companies that providing consumer staples distribution & retail; household products; food products; beverages; tobacco; and personal care products industries in the U.S. The SPDR Consumer Staples Index top 10 holding are: 1. Proctor & Gamble 14.11% 2. Costco Wholesale 11.56% 3. Pepsico 9.49% 4. Coca Cola 9.36% 5. Philip Morris Int 4.54% 6. Walmart 4.53% 7. Mondelez Int 4.47% 8. Altria Group 3.40% 9. Colgate Palmolive 3.06% 10. Target 3.00% We now know exactly what the SPDR Consumer Staples Index is and what its main components are. We know that the index itself is driven by stock prices from a collection of companies that offer Consumer Staple services and products in the U.S. Products/services people cannot do without, products they need day to day. Now lets have a look at the Chart Chart 2 – SPDR Consumer Staples Index AMEX:XLP At a glance the chart demonstrates the following: ▫️ The high in Consumer Staples in Dec 2007 coincided with the beginning of the Great Financial Crisis. In Chart 1 above on Consumer Discretionary we seen that a breach of the 200 WMA coincided with Dec 2007 GFC. Both charts demonstrated some synchronicity in advising caution from Dec 2007 forward. ▫️ Nine months later in Sept 2008 a lower high formed in Staples and after that the lower support line was lost following which capitulation occurred. I have marked up a similar “MUST HOLD SUPPORT” line for the current price structure. We have made a lower high similar to 2008. A breach above that lower high would be bullish, continued lower highs would indicate weakness. ▫️ Since 2009 Consumer Staples still appear to be in a general up trend with increased volatility in recent years however still in an uptrend. ▫️ The 200 WMA is still rising and sloping upwards, and price is now back above it now again which indicates strength. ▫️ All the same levels are apparent here as above in Chart 1. The 200 WMA, the “INITIAL SUPPORT” and the “MUST HOLD SUPPORT”. Now that we are familiar with the charts, their price history, the important levels to watch and some synchronicities, lets have a look at how these charts compare when you line them up together on the same scale. Chart 3 – Discretionary versus Staples SUBJECT CHART AT TOP OF ARTICLE We will take three main things away from this chart: 1. The big obvious finding on the chart is just the extent at which the Consumer Discretionary Index (orange) has risen above Consumer Staples(blue). This wide gap between the orange and blue lines is really stark and it appears it may be starting to close. 2. Historically Consumer Discretionary (orange) revisits and falls lower than Consumer Staples (Blue), particularly during recessions. We have a long way to go for this to happen again. See Chart 1 and Chart 2 above for important support levels to watch (for both). 3. Consumer Discretionary (Orange) started to make a series of lower highs prior to the Great Financial Crisis (see black arrow on chart), something similar may be occurring now. We are also already aware that Consumer Discretionary fell below the 200 WMA in exactly December 2007 which was the first month of the Great Financial Crisis. This is also the exact date when Consumer Staples topped in 2007. At present Consumer Staples made a top in April 2022 and Consumer Discretionary made a potential lower high in Dec 2023, however it has not fallen below and remained below the 200 WMA (making this a key line in the sand to watch going forward). Chart 4 – The Relative Strength of Consumer Discretionary In this chart I just wanted to illustrate the relative strength of the Consumer Discretionary over the Consumer Staples over the longer term. You can create this chart by inserting XLY/XLP into TradingView. As you can see this chart has been trending up and to the right since 2008. Discretionary spending appears to be on a long term uptrend and this is worth noting as a long term potential shift towards spending on services, experiences and higher end electronics. Technology Index’s in prior Macro Mondays are showing strength and we have to consider that if we do not breach the important support levels marked in Chart 1 and Chart 2 above, we may have a secular shift in spending habits towards discretionary (until support levels are broken). Granted this may be the least probable and least accepted view given recession fears, liquidity concerns and the yield curve un-inversion likely to occur in 2024. We do however need to keep an open mind, a COVID-19 type event might bring us down to the bottom trend line only to bounce off it after another stimulus hits the market. If we lost that lower support line, we can say unequivocally that the secular trend of discretionary spending strength is over. We now have a two more Indexes to watch that give us a good idea of the impact consumer spending is having on companies in the marketplace. We have our levels to watch and a good understanding of the risks and potential trends. Use it wisely. All my charts are on TradingView and you can revisit them at any time and press play to see have we breached any important levels to the upside or downside. Thanks for reading. PUKA
AMEX:XLP
by PukaCharts
2
Craft Beer Seltzer Alcohol Barometer: Sam Adam's Boston Beer Co.Alcohol consumption When averaged over two years, 2021-2022, 63% of U.S. adults aged 18 and older consumed alcohol. Gallup, Inc. indicates that "the drinking rate ticks up to 65% when narrowed to adults of legal drinking age" of 21. When segmented based on demographic characteristics: Eighty percent of adults, 18 and older, living in households with annual incomes of $100,000 or more consumed alcohol in 2021/2022. Only 49% of those living in a household with an annual income of less than $40,000 consumed the beverages. Likewise, the higher the level of education, the greater the percentage of adults in the cohort who had consumed an alcoholic beverage, while the incidence of consumption decreased as age increased. A nearly equal percentage of men and women consumed alcohol, 66 and 61%, respectively, when averaged over the two years. Pertaining to race and ethnicity, 68% of non-Hispanic white adults, 59% of Hispanic adults, and 50% of non-Hispanic black adults consumed alcohol. Another source, The 2023 Silicon Valley Bank Wine Report, states data from the Wine Market Council: 28% of consumers were "abstainer ," which "has increased 4 percentage points since the 2017 survey." 18% were "core wine drinker " who "drink wine at least once a week," which decreased from 21% in 2017. 15% were "marginal" who "prefer wine…and consume wine at least every two to three months… wine consumers who drink wine one to three times a month," which decreased from 19% in 2017. The remaining consume "alcohol, not wine" (29%) or are "infrequent alcohol" consumers (10%). Alcoholic beverage preferences and purchases When asked to indicate their beverage category of choice, 30% of consumers preferred liquor, 31% wine, and 35% beer. Another source, IRI, reports that 16% of alcoholic beverage consumers drink beer exclusively, 13% drink only wine, and 11% only spirits. Consumption of more than one category is as follows: Beer and wine, 13%, Beer and spirits, 12%, Wine and spirits, 9%, and All three types, 27%. When segmented based on consumption frequency, for consumers between ages 21 and 39 years, Wine Opinions found the following: Half (51%) of those who drank beer consumed the beverage "weekly or more often," 24% consumed the beverage 2-3 times a month," 8% "about once a month," and the remaining 17% consumed beer "less often or never." For wine and spirits, the percentage of consumers who drank the beverages at each reported frequency was similar: 30% of those who drank the beverages consumed them "weekly or more often," a third consumed the beverages "2-3 times a month," 16% "about once a month," and 21% of wine drinkers and 20% of those who drank spirits consumed them "less often or never." Those who consumed beer on a weekly, or more frequent, basis were more likely to be males, weekly wine consumers were more likely to be female, and "consumption of spirits is even by gender."
NYSE:SAMLong
by noam_chom
New Floors with Lumber Liquidators LL commodities retail rally“Inequality can be done away with only by establishing a new society, where men and women will enjoy equal rights, resulting from an upheaval in the means of production and in all social relations. Thus, the status of women will improve only with the elimination of the system that exploits them.” Lumber Liquidators looks good for a reversal. Small share float, strong sales, strong P/B P/E P/C and near zero debt vs equity. Risks: Value Trap, Discretionary spending retraction, macro momentum stays negative
LLong
by noam_chom
5
PLAY -ing with Fire Up here - Dave & Busters Eatertainment ChainDave & Buster's is an American restaurant and entertainment business headquartered in Dallas. Each Dave & Buster's has a full-service restaurant and a video arcade. As of January 2022, the company has 144 locations in the United States and two in Canada. A quick scan of Google Maps D&B locations shows that very few are rated above 4 stars This is a large national chain with a good footprint, however the upside is limited if common Americans begin to slow down discretionary spending.
NASDAQ:PLAYShort
by noam_chom
RTN:Lucrative risk reward!They recently agreed to acquire a Mexican style restaurant for £7 mil. With inflation expected to go slightly higher than current levels, consumer spending will definitely go down. Despite this I expect bulls to come in and support the share and catapult it higher from these levels its currently trading at. We are currently close to the all time lows and price action created a bullish formation on the weekly last week. I look to buy last week's close with ultimate target being the £80.00 zone. Will however take some off the table around the £60.00 zone. Total R is 4.35.
RLong
by taftrader
XLY XLP factors for 2022 and beyondQuick review of the spending habits over last the years since i published my first chart... covid craziness brought the chart heavily into the XLP 'stable needs' but a huge rebound into the luxury spending, probably due to the rich getting richer and all that crazy covid money and legal scams of the mega rich energy price increases and inflation has knobbled that spike and brought it way back down to earth with a lengthy recession in sight its good to review markets on these levels have a great summer, stay sane with all the relentless BS spouted from the MSM everyday! if u feel under the weather, throw out your Te'lie'vision
AMEX:XLY
by majorlee
AMZN targets the 92-82 pandemic D.bottom low & Vol Profile zone?AMZN has been making an ABC correction since the 188 ATH. The decline was very fast once it failed to hold the 150 volume profile zone. It has retraced exactly to 101, the 0.854 FIB of the 82 pandemic low to ATH. There was a little bounce but AMZN basically is just hovering around the 2016 TL while consolidating inside my red box without breaking the downtrend line. LOOKING BEARISH. I think AMZN will target the pandemic low at 82 to make a double bottom ending hew ABC correction. 82 is also the 0.618 FIB retracement from 14.20 (2015 low) to ATH. 82 is also the 1.618 Fib Extention of the ABC correction, making it a very strong support. WARNING: There may still be a 20% downside from latest low at 101 as consumer discretionary will be the first to suffer during an economic downturn. Not trading advice
NASDAQ:AMZN
by xtremerider8
Rare Buying Opportunity for AEOThis monthly chart for American Eagle Outfitters ( AEO ) shows a clear non-logarithmic trend line that has continued throughout the history of the company's existence on the exchange (except briefly during COVID lockdowns). The green shaded area is a definite buy area for long-term investors. This linear trend held up during the Great Recession when 10% of the population was unemployed, and there is no reason to believe that economic circumstances are worse now than in the Great Recession, such as to expect the 25-year trend to end. Similar to VFC , this is another high dividend stock that is sitting in a relatively rare buying zone. Based on my charting analysis, I believe that this stock will likely end 2022 about 25% higher than the current price. So based on the charts, I expect to get about a 25% return on investment in addition to a 5% dividend by the end of the year. Not financial advice. As always nothing is ever guaranteed. Trends can end.
NYSE:AEOLong
by SpyMasterTrades
$SONO back towards $45It has maintained overperformance over the consumer discretionary sector (represented by XLY) but has lost some of its relative strength against it. It appears that the extra alpha and extreme overperformance is going to be back on SONO 's side based on the chart bottom chart where the relative strength is hitting a level that usually would result in a bounce back. They have earnings coming up and tend to trade very well after earnings, at least initially. On average based on the last 3 earnings reports, they could have roughly a 25.77% return after this upcoming earnings report. This is also a holiday/seasonal trade for me. They should have a killer quarter. The company is also extremely well managed and the product is unbelievable. Sonos isn't going anywhere anytime soon unless they get acquired AT A PREMIUM.
NASDAQ:SONOLong
by EBITDAtiger
2
Amazon technical target --> $5000Amazon has been consolidating for almost 10 months. Today's news of a big beat on earnings and guidance has taken us to the top of the consolidation range. It is a classic move for stocks that have been consolidating for a long time, to make a strong move upward before consolidating again. Making a measured move from the last time it did this, we get a potential target around $5000 in a 4-5 months time-frame. To avoid a failed breakout, I would keep on eye on the MACD trend, which has turned positive, but should continue to rise to confirm the move up.
NASDAQ:AMZNLong
by dorfmanmaster
2