How Giant Buy Side Institutions Changed Stock Market Structure
Dark
Pool Quiet Rotation Patterns™ are here to stay, despite what the retail news
media hype portends. The Securities and Exchange Commission SEC has
investigated the practices of giant Buy Side Institutions using Dark Pools, and
it has been proven that they are not getting any price advantage.
Dark
Pools are used to hide giant lot orders by Buy Side Institutions, and to ensure
when the giant lot orders are triggering there is no major disruption of the
current trend. If you are new to trading, this is critical information to
learn. If you traded during the 1990’s and before 2005, then this is even more
important.
Go to the TechniTrader
It is a major Market Structure change that has altered everything you would have learned previously about trading stocks, and continues to change price and volume patterns today.
The following are 3 major Dark Pool candlestick patterns to learn:
1. Dark Pool Quiet
Accumulation Patterns
2.
Dark
Pool Quiet Rotation Patterns
3.
Dark
Pool Quiet Distribution Patterns
Most
traders learn “Accumulation and Distribution” candlestick patterns, which are
broad terms not clearly defined. Unfortunately QUIET is very different now with
Alternative Trading Systems venues. The term “quiet” means it is not visible in
the chart, unless you use specific indicators and know what to look for in
price action.Many Retail Traders are prone to sticking with outdated Methodologies, Strategies, and Trading Systems so it is a leap of faith for them to accept the new reality of stock trading. However until you learn the Dark Pool patterns, trading profits are likely to be a disappointment.
Go watch the Candlestick Patterns Webinar, to experience for yourself the excellence of TechniTrader education.
Go to the TechniTrader
Today we are studying Dark Pool Quiet Rotation Patterns, which differ from Quiet Distribution Patterns. The term Quiet Distribution refers to a mandatory selling of shares of stock held in trusts and charters. Giant Funds Managers of Buy Side Institutions do not wish to sell the stock, but are forced to do so based on sudden huge redemption demands by their uninformed Mutual Fund Investors. Distribution dumps a huge amount of stock for sale suddenly, removing money from the Stock Market so there is an outflow of monies aka funds.
Rotation is always quiet these days and well hidden from view, and eventually it may cause a topping action. Quiet Rotation does not remove monies from the Stock Market. The Giant Funds Managers are merely moving money around from one stock to another.
The chart example below has been under Quiet Rotation for some time.
The TechniTrader Flow of Funds TTFF Indicator in the bottom chart window, reveals that the flow of money into this stock is not keeping up with the fast pace of the Retail Traders and the Smaller Funds. Both of these Market Participant Groups trade like they belong on the retail side of the market, rather than on the professional side.
Go to TechniTrader “The Basics of the Stock Market for New Investors and Beginning Traders” 12 Webinar Lessons, to experience for yourself the excellence of TechniTrader education.
Go to the TechniTrader
The
giant Buy Side Institutions use these two Market Participant Groups as a cloak
to hide their Dark Pool Quiet Rotation Patterns. By not disturbing the trend
but allowing the stock to climb higher due to Retail Trading and Smaller Fund
buying patterns, the Dark Pools actually benefit as they sell hidden on their Alternative Trading System venues.
Summary
The Volume Oscillator "TechniTrader Volume Accumulation" TTVA, starts heading down and diverging contrarily from the
price action which is a critical point all traders need to recognize. Sure you
can trade the stock as it moves up, however if you are not aware of the heavy
Quiet Rotation out of this stock, a buy could end up being a serious major
loss. This stock gapped down after barely rising above prior resistance.
The "TechniTrader Flow of Funds" TTFF indicator lags behind price, which is moving with speculative emotional buying by smaller lots.
Go to the Learning Center and watch a
wide variety of training webinars including Technical Analysis, Bollinger Bands, MACD, and Candlestick charts.
TechniTrader
The Gold Standard in Stock
Market Education
Trade
Wisely,
Martha
Stokes CMT
TechniTrader technical analysis using a MetaStock chart, courtesy of Innovative Market Analysis, LLC dba MetaStock
Chartered Market Technician
Instructor & Developer of TechniTrader Stock and Option Courses
TechniTrader DVDs with every course.
This weekly stock discussion is sponsored by TechniTrader.com a MetaStock® Partner
©2016–2024 Decisions Unlimited, Inc. dba TechniTrader. All rights reserved.
TechniTrader is also a registered trademark of Decisions Unlimited, Inc.
Disclaimer: All statements are the opinions of TechniTrader, its instructors and/or employees, and are not to be construed as anything more than an opinion. TechniTrader is not a broker or an investment advisor; it is strictly an educational service. There is risk in trading financial assets and derivatives. Due diligence is required for any investment. It should not be assumed that the methods or techniques presented cannot result in losses. Examples presented are for educational purposes only.