Which Means Analysing A Stocks Past Price Actions To Predict The Stocks Future Direction

Category: Finance.

What I am about to disclose with you, is a very atypical article. They created the prominent" Global Alpha" computer stock trading model, while contracted to Goldman Sachs.

This article is about two programmers who created the first commercially available stock selection program. Software which most years is responsible for 4, 000, 000, 000+ Annual Trading Profit. Unfortunately he had signed a Non Compete and NDA agreement with Goldman Sachs, forbidding him to create software which trades derivatives and similar financial instruments( like Global Alpha) . With this software project completed, Michael looked for a new way to line his pockets. After 3 weeks of being temporarily unemployed, Michael who was very wealthy and very bored. You see Goldman Sachs and most other large investment fund are at a chief deficiency.

Resolved to begin a new project. They regularly handle portfolios of up to$ 10, 000, 000, 000( ten billion dollars) - and because of this when they invest in stocks their scope is limited to just a few of the worlds biggest firms( Coca- Cola, Google) . In reality Warren Buffet( Whom handles$ 53 billion) has the exact same conundrum. This conundrum is widespread amid fund managers whom handle large quantitys of capital. Michael knew he could take advantage of this. In reality it is intended to trade in the explosive penny stock market where stocks can escalate 400% in a matter of minutes. By developing software which can run on any home computer, and handle funds between$ 100 and$ 500, 00 Being in charge of such a small comparative amount, Michael s software could yield much higher returns.

Michael worked with fund manager Carl Williamson to create the bot. "Mar1" operates by analysing each stock with" technical analysis" . The numerous changes in price( when made into a chart) form what traders call" chart patterns" and it is exactly these price paterns Mar1 is looking for. Which means analysing a stocks past price actions to predict the stocks future direction. When first activated, Mar1 will use its own database to perform a scan of stocks trading on the OTC and Pink sheets exchanges. If Marl identifies a clean, that is proven, uncongested chart pattern to yield a good risk/ reward- Then the stock will be added to Mar1 s" watched stocks" list. During this time Marl is looking for companies whom are forming bullish trading patterns. (stocks about to increase) Carl helped Michael program the bot to recognize( in split second timing) clear trading patterns from a vast range of 6578, held in Mar1 s domestic database.

All of these" watched stocks" will be forming bullish patterns( indicating the stock is about to rise) . The first and most obvious is that Marl can easily monitor hundreds of stocks at the same time. This watch list has two distinct advantages. The second is that Marl is programmed on am" evolutionary framework" . What this means. is that as Mar1 is watching hundreds of stock patterns it actually learns the most likely direction of stock prices under thousands of situations.

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