r/options
Night vs day
The author warns that overnight market gains are driven by insider trading by big players, leaving retail investors as slaughtered cattle.
- Market gains are driven by insider trading and manipulation by big players.
- Retail investors are being used as exit liquidity and slaughtered by institutions.
- Technical indicators are useless against institutional manipulation and inside information.
There are numerous statistics that show over the last 30 years almost all stock market gains occur overnight.
Here's one - https://www.nasdaq.com/articles/night-and-day
I think this year has given us some insight into the driver of that effect, especially this past 16 months.
It's no secret the big players have inside info, hypothetically, the head of prop trading at GS might get a call from his former Harvard or Wharton college dorm mate who works at the defense dept the day before an attack on a small third world nation that has huge impacts on oil prices.
His trading buddies then get phone calls, Congress and Senate members are all in, the presidents family, all set up.
Take a glance at any SPY chart from this past March that includes overnight movement, it becomes a lot easier to read between the lines to illustrate my point, "TACO" trading.
Retail participation is at an all time historic high percentage-wise, real-time retail order flow is also at a historic high for the big players, there's a lot of cattle available for slaughter.
By "cattle", I mean us - Bagholders wanted, no experience needed.
There's a message here, if you're looking at the RSI, trading patterns, MACD's, VWAP or whatever else's is trendy, the message isn't for you, I've had those debates far too many times.
"Hey, let's be careful out there" - Sergeant Phil Esterhaus