This video is fantastic to understand clearly how machine learning works,
It’s perfectly understandable that the industry has called it “machine learning” instead of “continuous back-testing of scalable algorithms”.
How Machines Learn
Reply
Monthly Archives: January 2018
BTC Futures offered by CME group
I read this article and now I understand some of the things that are happening in the values of the crypto-currencies.
CME group is offering the possibility to trade with Futures of Bitcoins
CME group is owner of some of the largest and more relevant markets. It owns and operates large derivatives and futures exchanges in Chicago, New York City, and exchange facilities in London. It also owns the Dow Jones stock and financial indexes, and some other markets.
How the futures market operates (from the article)
In a futures market, if the price is $500/BTC, an investor needs to buy 50 futures contracts, each worth $10. If an investor wishes to open a positive position then he goes long with “buy” contracts, and if he decides to open a negative position, he goes short with “sell” contracts. An investor’s position can be either positive or negative for the same instrument.
Consequence
Before middle of December 2017 people were operating in one direction: market going-up.
Since middle of December 2017 there are people operating in both directions: some looking for the market to go-up some others looking to the market to go down.
You can see Bitcoin Futures quotes here.
Triggers, creating behavior that lasts
“Triggers” is the name of this book, which goal is:
- Enable you to create behavior that lasts.
- Help you to be the person you want to be.
I was reluctant
when I started to read this book, thinking about what it could offer to me.
Marshall Goldsmith does a direct clear introduction about what the book is about and it convinced to me about the idea.
I like the way he express the ideas, the stories and the tone of the book is very pleasant; somtimes you have the feeling he is coaching you while you are reading it and this interaction is funny too.
What I put in practice
There are several aspects about triggers that are described in the book. I have put some of them in practice:
1. Identification of triggers:
This analysis is very interesting to understand how they happen, how they evolve, and the consequence they produce. Once you have listed the triggers it’s interesting to put on the proposed diagram. The division of the trigger in: event, behavior, consequence; is also an important topic to understand how it works and what you have to change: the behavior.
2. Remove negative things from the environment:
The importance of the environment is something I was understimating. Now just with the analysis of it, and the identification how it influence on me, I pay more attention to this aspect.
3. Save time adding time:
I just added a table on a paper with things I should eliminate and how much time it takes per week. I have been able to earn 12 hours easily for activities that matters to me.
4. “21 days challenge”
As an exercise to promote the addition of good habits in my day to day. I plan to do a couple of these per cycle, increasing the complexity and attending the more important habits I want to incorporate.
5. Daily engaging questions:
I have started to do it, and it’s linked to the previous point of the 21 days. It turns the desire in habits and let me evaluate the situation.
6- The wheel of change:
I have done a list of things, then I have given them an unique number (basically the same list of identified triggers). Finally I have drawn the wheel.
I have added each point:
- in the place I think it’s today,
- and with an arrow, to the direction I want it to go. This is helping me to evaluate where I am and where I would like to be.
7. “1 hour questions check”:
This is useful to distress special situation where you know you can easily fall in the wrong behavior.
- Did I do my best to be happy?
- Did I do my best to find meaning?
- Did I do my best to build positive relationships?
- Did I do my best to be fully engaged?
8. List of depleting activities:
You do the list and then you define a strategy once you are in front of them: delegate, avoid, postpone, just do it… When you have to do then, change your attitude lowering the depleting impact.
9. Good enough attitude:
Avoid the conformist attitude in your personal live.
Be a professional, not an amateur.
Providing structure and timing
You will find a lot of tips as: do “this” 21 days and you will solve “that”, and some other tips without context. I collect these tips an I quickly relize they are not realistic, they make no sense on the context of the rest of my life, so they are useless without context.
The difference on “Triggers” book is that Marshall provides us 2 important things:
- Structure to work on each things you want to change.
- Specific activities and exercises with different timings:
- 1 hour question check.
- Daily questions.
- 21 days challenge.
So, if we plan different priorities, start adding them in the loop of changes, puting them in the right timing and driving the things in the right direction; then and only then we can really promote change in the way we behave.
Micro-districts
Taillin, Estonia, summer 2016,
we arrived to the city and did the traditional tourism walk in the historical center. Taking some information and reading about what our book say about the city, it was clear the URSS influence on the city in their history.
After that we went to the appartment we were going to stay. This was inside of a major district built during the URSS period. They are called micro-districs.
How does micro-districts work?
The person hosting in his home was a Russian citizen, he explained to us that the round shape of the district tried to influss the sense of community into the people living there.
All services where inside: stores, school, police station, a small health office… in your day to day you could spend the whole day there. As a child, to stay in the distric was very common.
For instance, in a building of flats, the older children had to pick-up the younger ones, so they would go with them to the school; in this way the mothers could work at home. There were other rules like that to reinforce the sense of belonging to the district. This small gesture was to promote the continuous collaboration between people.
Cupertino
Today I have seen a picture in the news about the evolution of the new Apple headquarters office. When I saw the picture I could not resist the comparisson to the URSS microdistricts.
What do you think?
Kraken
For my poor memory I will list some of the experiences I have had using Kraken.
Configuration, set-up and deposit
All work easily and quick
Stop-loss
They are deactivated since July or August of 2017, due to a overload of stop-loss was provoking that the triggers were not working.
Maintenance
Today I entered in the site and I found it. Today means:
- 11/01/2018 10:54 CET
- 12/01/2018 18:08 CET
***MAINTENANCE ANNOUNCEMENT***
Kraken is presently offline for maintenance.
While maintenance is underway, the website and API will not be reachable, and orders will not be able to be placed or canceled.
The Kraken Team
s
Hedonismo ilustrado
A partir de este artículo de Marcos me puse a leer más cosas sobre el estoicismo, y por ende también he leído algo más para enteder el hedonismo ilustrado; por ejemplo este otro:
The happiness advantage
Seven principles of positive psycology that fuels success and performance at work, by Shawn Anchor.
The Happiness Advantage
says that people who are happy have a psychological advantage over people who are unhappy. One way to test this is through studies over time.
- Meditate.
- Find something to look forward to. Anticipate future rewards lights up the pleasure centers (Pirineos)
- Commit conscious acts of kindness.
- Infuse positivity into your surroundings.
- Exercise.
- Spend money on activities.
- Exercise a signature strength (painting…)
The Fulcrum and the Lever
talks about the power of the mindset. The fulcrum is the mindset of the person; the length of the lever corresponds to the potential power and possibility that person believes s/he.
If someone moves the fulcrum in the right direction by adopting a more positive mindset, the lever of possibility lengthens, which leads, to an eventual positive outcome.
The more you believe in your ability to succeed, the more likely it is that you will (confidence).
Remind yourself the relevant skills you have, rather than those you lack.
More important still that believing in your own abilities is believing that you can improve these abilities. Instead of being a “fixed mindset” person, be a “growth mindset” one.
The Tetris Effect
talks about how to retrain your brain to spot patterns of possibility rather than patterns of failure.
The tetris effect stems from a very normal physical process that repeated playing triggersin their brains. They become stuck in something called a “cognitive afterimage”.
Scan the word with positive attitude: it increases creativity, decreases stress and increases our motivation to complete the goals. The result? happiness, gratitude and optimism.
Falling Up
How to find the mental path out of failure.
The Zorro Circle
In the face of overwhelming odds, how to fight off emotions and regain control by beginning with small manageable goals, and them make the circle bigger.
The 20-Second Rule
is about how to fight off the weakening willpower to be positive.
We are mere bundles of habits that we are able to automatically perform many of our daily tasks.
Willpower is not the way, the more you use it, the more worn out it gets. You have to workout your willpower. The need to train the habits (21 days).
Advertisers and marketers make their live on the path of least resistance. They easy the way they want you to act (basically as an illustrated hedonist).
Lower the activation energy for the habits you want to adopt, and raise it for the habits you want to avoid. To decrease the amount of choices also lower the activation energy to act.
Repeated actions is the key to create these habits, until te actions become ingrained in your brain’s neural chemistry. And the key to daily practice is to put your desire as close to the path of least resistance as humanly possible. Identification of the activation energy is a key step on all this.
Save time avoiding distractions and activities that are not a priority.
Set rules of engagement in advance, it free us from the constant use of willpower.
Social Investment
Some tips about how to invest in friends, peers and family members to move forward in challenging times. Some examples about how this influences in the individuals and the society.
They are your football offensive line that protects you from stress and adversity.
Paper trading
Paper trading is a stock market simulator. Tradingview enables you to work on paper trading in an easy way: it’s embeeded and you can launch the positions very easily.
I have started to use it as part of the tests I’m doing. It has pros and cons.
Pros
It’s very clear and it’s very intuitive to create the positions, move the stop-loss, etc.
Cons
- Mentally you do not have the pressure of the real money you are investing.
- You launch positions very quickly and they are executed very quickly. Real live does not work like this, and I still do not understand all that happens in the middle. To launch positions in Kraken is very different and the behavior of the market (offer and demand) is different as paper trading operates.
Paper trading is in any case a good tool for testing, and monetize the positions you perform and check if the strategy and the way to put it in place works.
Strategy to test: bb-rsi-cmf
The strategy I’m using is very popular and extended. So many people knows it and therea re thousand of variances to the main one. Surprisingly it still works.
The name I gave to this strategy is “bb-rsi-cmf” and comes from the 3 indicators I’m using to work on it.
These indicators are:
- Trend indicator = Bollinger bands.
- Momentum indicator = RSI.
- Volume indicator = Chaikin Money flow (confirm with japanese candles).
Configuration of the indicators in Trading View
The configuration of the Bollinger Bands in Tradingview can be adjusted, especially for the standard deviation that by default is 2. I have adjusted to 2.5 to increase accuracy.
From the Wikipedia about StdDev:
- For the normal distribution, this includes 68.27% of the numbers;
- 2 standard deviations from the mean include 95.45%;
- 3 standard deviations from the mean include 99.73%;
- 4 standard deviations from the mean include 99.994%.
The configuration of the Chaikin Money Flow (CMF) indicator just have a parameter: Lenght. It indicates the time period to be used in calculating Chaikin Money Flow (I keep the default value = 20).
The configuration of RSI have a couple of parameters:
- Length: The time period to be used in calculating the RSI. 14 days is the default.
- Source: Determines what data from each bar will be used in calculations. “Close” is the default.
Entry criteria:
- Wait for the candle to pass the low bollinger band. On this event,
- Check that RSI < 30%, or close to it.
- Check that Chaikin Money Flow has enough volume.
- If so, go to next step.
- Draw the resistances using the red candles taking the ones that are higher.
- Wait till the value cross the resistance line. It’s better when the cross is done by a green candle. Open the position at this point (this action requires you a quick reaction).
- Define the exit point and the stop loss.
Exit criteria
- Define the stop loss (1%).
- Define the exit point (2%).
- Close the position when some of the events happen.
During the position is opened
- Pay attention to the way the value is moving.
- Check the volume of activity in the table of prices.
- Check if RSI rises above 70%. This means the market is overboughting (good!).
- If the value goes up, move the stop-loss up, (ideally turn the stop-loss into a stop-win).
First try, Lose.
This picture below shows the first try I did on this strategy, the result: lose 1%.
Chaikin Money Flow behavior
When Chaikin Money Flow crosses the Zero Line, this can be an indication that there is an impending trend reversal.
- Bullish Crosses occur when Chaikin Money Flow crosses from below the Zero Line to above the Zero Line. Price then falls.
- Bearish Crosses occur when Chaikin Money Flow crosses from above the Zero Line to below the Zero Line. Price then rises.
It should be noted that brief crosses can occur resulting in false signals. The best way to avoid these false signals is by examining past performance for the particular security that is being analyzed and even adjusting the thresholds accordingly. For example, instead of a Zero Line Cross, a technical analyst may use two separate lines such as .05 and -.05.
Bolsa para Dummies
Un amigo me recomendó leerme este libro, en concreto la parte 3, que recorre un día de trading cualquiera, repasando hábitos y actividades en las cuales nos deberíamos centrar; y la parte 4, que repasa varias estrategias básicas: gap, bandas de bollinger, y cruce de medias. Me sirvió para confirmar algunas cosas que ya había aprendido y reforzar algunos hábitos.
El libro está escrito en un lenguaje muy directo y repite las cosas varias veces sin resultar demasiado espeso. Se lee rápido y encuadra los conceptos en base a un esquema que se respeta durante todo el libro.
