DynamicHerd

A documented journey of an average speculator.

[DynamicHerd @dynamictrader99]

@LeoTheTiger Wen footprint?

[DynamicHerd @dynamictrader99]

@ryan_canon @LeoTheTiger Yes, it does

[DynamicHerd @dynamictrader99]

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[AW Trades ♛ @aw_trades_]

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[fabervaale.official @fabervaaleeng]

One of the most expensive mistakes in systematic trading is selecting a model before identifying the regime.

A Momentum strategy and a mean reverting strategy can both exhibit positive expectancy, attractive Sharpe ratios, and robust OOS results.

Yet over a single quarter, their performance distributions can diverge dramatically.

Why?

Because alpha is often regimedependent.

A volatility expansion environment rewards momentum persistence.

A volatility compression environment rewards mean reversion.

The model didn't change.

The market structure did.

Before asking whether a strategy works, ask:

Under which conditions was that edge created?

Regime first.
Model second.

This is why many large funds allocate simultaneously to:

Trend Following
Mean Reversion
Global Macro
Volatility Arbitrage
Relative Value
Market Neutral
Event Driven

[DynamicHerd @dynamictrader99]

@Robwhitlow3 count me in !

[VolSignals @VolSignals]

If you are new to "GEX", or using dealer hedging requirements to predict price movement

Most of your trading improvement will come from understanding (cleanly and accurately) these things:

Gamma
Charm
Pinning

It's just easier to understand with a whiteboard >>

[DynamicHerd @dynamictrader99]

@_sierratrading @tradertryhard Do you provide options flow data for CL (crude oil)?

[DynamicHerd @dynamictrader99]

@edgeful ORB

[DynamicHerd @dynamictrader99]

@MyTailorisRich @TraderYush are you using the same ticker as him? micros and minis have different order flow even though both track the same instrument.

[DynamicHerd @dynamictrader99]

@Robwhitlow3 Oh, the timeframe can change depending on zooming in or out. What timeframe are you using for your heatmap?

[Ryan Wright @baynkr]

I’ll go on record and say 95% of what developing traders call “psychology problems” are really just gaps in their process.

If you’re constantly chasing trades it means your entry rules aren’t clear enough. If you’re freezing up at exits it’s because you never defined your targets. If you’re panicking every time price moves against you it’s because you’re sized wrong or never built a position sizing framework in the first place. Moves that fall within your process shouldn’t cause panic.

All of this stuff flows directly from process. Stop reading mindset books and start defining your process. Your trading shapes your mindset, not the other way around.

[DCP @Dcpcooks]

Working with a newer trader to explain how I approach the markets

Here is a copy of a dm I sent, I hope it can help

Yes slow the brain down, the market will tell you what to do.

The hard part is getting to that level of zen if you will.

It took me years to slow down and listen to what is going on.

I try to keep it as simple as possible

You want a system that is simple repeatable and scalable. Then you want a system for managing order entry and exit

Stop loss and profit target must be identified before you enter a trade. Risk management is the most important things you control outside of your emotions.

I use very simple tools to measure the market

Every morning I look at the opening range of the first 30 seconds at 8:30:00 to 8:30:30 I use that as the baseline for positioning. I look to be long above or short below that price range

Every algo has that price level in its baseline formula

Also the same for the prior days closing range

If we are above yesterday’s closing range and we trend above the current opening range I look for a trend day which is around 20% of trading days

If we are in between those levels we are likely in a range bound consolidation and which is the majority of trading days

You want to learn how to identify which environment you are in and adjust your trade plan accordingly

I look to add aggressively on trend days

I scalp level to level on consolidation/ range days

I like to take a quick profit and adjust my stops to in the money and left the market run. Then I look at momentum and where were are in terms of std deviations within different time frames to gauge market strength.

If we are trading up towards a 2 std deviation and momentum is above trend I look for adjust my expectations for an exit price. Same for being short just in reverse. That is a trend day example

On a consolidation day I will look for opportunities for mean reversion. By that I look for entry and exit levels with the expectation we will revisit the opening range.

Two separate concepts to learn. Once you begin to see that in the market it takes a lot of the thinking out of your day.

You don’t need to be correct on your macro view you can just trade price action without emotion f’ng with you.

On a trend day when the market trend is strong and it aligns with my macro view is the scenario where I add aggressively to winning positions

[DynamicHerd @dynamictrader99]

@rubenleija_ @tradingview Does this include CL?

[DynamicHerd @dynamictrader99]

@GyorgyakLaszlo @Kusanagi_LF count me in !

[DynamicHerd @dynamictrader99]

@toriotrades Haha damn, you got such a nice hand writing there!

Wondering why mine looks so ugly 😂

[DynamicHerd @dynamictrader99]

@steamboatgeyse @TraderYush on your 2nd picture, may i know what study did u used for that volume profile (right side)? is that even a volume profile at the first place?

[DynamicHerd @dynamictrader99]

@TraderYush Took a quick CL short yesterday. Spotted offside buyers at the extreme high. Thesis was, if they got squeezed, a VWAP reclaim was likely. Footprint confirmed a strong bearish auction. Shorted the LVN and let it run to target, staying alert for buy-side volume stepping in.