A large majority feels the book like so many others, will have its "15 minutes of glory" and then disappear into the vault of forgotten books on the evils of the stock market.
It didn't ruffle anyone on the institutional side because most of the important institutions are using Dark Pools.
No, the Dark Pools are not front run by High Frequency Traders.
It is called a Dark Pool because it is a non-transparent order system that doesn't display until AFTER the order is filled, so HFT algorithms can't see the orders of the Dark Pools.
Proprietary Desk Traders which are those traders who work for the Sell Side Institutions to make money for their employers, the big banks, financial services companies, hedge funds, etc.
believe the book will not cause more regulations.
More interesting was the consensus that educating the uninformed and less informed average investor, is probably the best cure for the systemic mistrust of the general population regarding the stock market.
That is fascinating since the stock market in the eyes of the general population covers the entire financial industry which includes bonds, commodities, futures derivatives, interest rate derivatives, credit markets, real estate, stocks, annuities, and forex.
This inaccurate thinking is one of the primary results of nebulous and outdated information spread across the internet.
What seems to be even more of a problem is that the average person believes that HFTs are a real human being, a trader who is evil and out to destroy their life savings.
The news media made no attempt to clarify that HFTs are algorithms, not human floor traders.
There is no one sitting at the other end of the high speed fiber optic line, waiting like a predator for the orders to flash by.
It is a computer program searching among billions of orders for cluster orders.
How do retail traders avoid being part of the front run of an HFT millisecond order rush? How can the average retail trader take advantage of HFT runs that create huge one day price gains? It is possible for retail traders to take advantage of HFT order flow using the following 10 Tips: 1.
HFT action that has huge gains with huge volume on a daily chart is a one day event.
Rarely do the HFTs trigger the next day.
2.
Learn to identify the setups that precede huge HFT price action.
These are compression patterns out of platforms and consolidations, after Dark Pools have ceased accumulating.
The goal is to get in ahead of the one day event.
3.
Gaps as well as long one day run candles form when HFT activity is present, so it is critical to identify when the Dark Pools have stopped their accumulation at that level, so you can prepare to enter before the news "leaks" to HFT algorithms.
4.
The one day event can reverse the same day.
It is not the norm but it does happen, so this is a one day swing style strategy.
Exiting the day of the run up, just prior to market close is the best exit strategy.
Sometimes profit taking occurs or smaller funds cause the stock to drop down the next day.
5.
Trading ahead of HFTs is taking advantage of their huge order flow and price gains.
It takes an understanding of what strategies they are using at that time for example news, retail strategies, technical, arbitrage, or fundamental aka Dark Pool activity.
Knowing what types of algorithms are causing the price action is important.
6.
HFTs constantly change their algorithms to find certain predictable patterns.
Cluster orders from retail traders all using the identical red light/green light system, an overly popular indicator such as MACD, or a guru recommendation are easy targets for the HFT order triggers.
7.
Always remember you are dealing with a computer, not a human.
There are no people watching the orders, no floor traders monitoring order flow, nobody is watching the HFT screens.
8.
There are no fail safe systems built into HFT algorithms.
You must be aware that HFTs are wrong much of the time, and also that they place far more orders than are ever executed.
Once the HFT starts, it will run even if the transactions are losing money for the HFT firm.
You need to avoid these scenarios or you will lose money also.
9.
Trade with the trend of the Dark Pools.
At times HFT algorithms get it wrong and trade against the Dark Pool quiet accumulation.
This pattern is seen frequently and creates losses for the HFTs who have NO access to the pre-order status of Dark Pools.
10.
Do not be greedy, taking profits before the run concludes is best.
These are one day events that are best traded as such.
Intraday trading of these is far too volatile for reliable or consistent profits.