Dave Floyd

A little harsh, but Ralph Vince wasn't wrong here. I think the “limited mental notions of how things should operate” is a particularly salient turn of phrase. You see a lot of anger and frustration when markets aren’t working “the way they’re supposed to” around here. Forget about how things “should” operate, start taking note of and adapting to how things “are” operating in reality. You’ll probably make a fair bit more money that way 🫡

Why don't stats like this appear in the marketing and performance material for actively managed ETF's? What a joke. ....participated in 192.77% of S&P 500 downside but only 170.74% of its upside. Enjoy your weekend.

Another very narrow range day thus far. No edge as of now. Sidelines offer a good view with zero capital exposure. Odd, given all the geopolitical headlines swirling around. Context first.

@KrisAbdelmessih Got tix for the PDX show of Angine de Poitrine on Aug 21st

Microtonal fest

The market is content to make you earn the read. There's a version of trading that tries to eliminate this part - to reduce the tape to inputs and outputs, to build a system that fires when conditions are met and sits on its hands when they aren't. There's merit in that. Discipline is hard to automate and harder to maintain, and a well-constructed system carries neither ego nor impatience. But what I was watching in that range - the character of those spike-and-recover sequences, the slight but meaningful stall in the VIX, the way the offers kept getting refreshed just overhead - these are things that resist quantification. Not because markets are mystical, but because the signal is in the texture, and texture is difficult to encode. You know it when you see it. That's not an excuse for vagueness. It's a description of where the edge lives.

@CliffordAsness Thanks for highlighting the beta vs. correlation distinction.

One of the dumber things you hear lately, from a lot of supposedly non-dumb people, is “stocks and bonds are now trading positively correlated so you now desperately need this other investment that’s way way more correlated with stocks than are bonds.” Those investments are the typical. Privates (which are just equity, so it’s “you need more equity to diversify your equity”), buffer funds (which are just equity + cash minus some number), and crypto (which increasingly trades like equity, and is, you know, mostly nonsense, but even if you love it it’s currently bringing more equity exposure than bonds). My colleagues latest explaining:

Love this comment about journalists (which very few are anymore): They’ve all become whores to the cheap shot.

You can choose to ignore market-generated information/signals and still press your view. Traders do. But you are then arguing with the tape, and the tape has a better track record than the argument.

$SPY $ES_F * And yes, this post was condensed from a 750-word audio capture I uploaded to Claude - my thoughts - just not my edits. * Opened at the top of the range. Dropped 35 points in minutes. Then something interesting happened. Three separate times the market spiked lower - sharp, fast, the kind of move that feels like the beginning of something. Each time, buyers came in immediately and bid it right back up. Not eventually. Immediately. That's information. A market that keeps rejecting its own breaks isn't a market that wants to go lower. It might get there. But it's telling you the buyers aren't done yet. So I didn't press the short, even with the market sitting right under resistance and the VIX refusing to cooperate. The structure was solid. The tape was balanced. Shorting into that without a real edge is just hoping out loud. Sometimes the best read is knowing what trade isn't there. My process. Not trading advice. Pending CTA.

PAPP = Price Action Ping-Pong. Price structure provides an edge - it helps identify those extreme edges - look at $ES_F 6595 & 6642 and $VIX at ~28 and 26.51 Not trading advice - my process. CTA pending.

Tricky AM for $ES_F, but if you are/were watching closely, downside action stalled right into key structure at 6590-6580. Sellers were persistent but could not crack lower. However, there was no rip higher either - just a few squiggles that could not be sustained. With 6616 the next structure and $VIX ping-ponging at 26.51 the edge is rather small and not worth it IMO. You have to 'read the room' so to speak. Levels alone are merely step #1. Not trading advice. CTA Pending. My process.

Quite the opening range today with ~20 point rips up and down. Tough to tag an entry that gives you any directional persistence. $ES_F Not trading advice. Just my observation. CTA pending.

Read an article yesterday by @arpitrage - Three Rules for AI in Finance - and one idea in particular has stayed with me. There's a concept from computer science called Amdahl's Law: the speed improvement you get from optimizing one part of a system is capped by how much time you actually spend there. If 80% of your process lives in the hard part, making the easy part ten times faster moves the overall needle by roughly twelve percent. AI is about to make trading signal generation essentially free. Faster screening, sentiment analysis at scale, pattern recognition across thousands of instruments simultaneously. These are real capabilities producing real value. But signal generation was never the hard part, and more of it doesn't change that. Markets have always produced more tradeable setups than any practitioner can act on intelligently. The binding constraint is execution in context - knowing which signals are valid given current market structure, where price sits relative to meaningful reference points, and whether this moment resembles the last hundred times you've seen this setup or the handful of times it didn't resolve the way it should have. That distinction lives in repetition, not computation. A signal without context is noise with better packaging. What AI cannot replicate is the judgment formed by watching the same instrument behave across multiple market cycles - the feel for when a level holds because it should, and when it holds simply because nobody has tested it yet. Those are different things. They look identical on a screen. The practitioners who extract real value from what's coming are those who've already solved the execution problem. They'll use AI to handle the commodity work faster and cheaper, freeing attention for the calls that remain stubbornly human. The ones who won't are mistaking cheaper inputs for a shortcut around the hardest part of the job. Amdahl's Law doesn't care how impressive your tools are. It only cares where your time actually goes.

$NKE sitting in no man's land below all the levels that matter. No support structure. No edge. Yeah, it could bounce - anything can. But that's not a thesis, that's just hoping. Sometimes the best trade is recognizing there isn't one. That's the difference between having a process and just taking shots.

@bonchieredstate The same clown who back in December whined about being tired after working for 49-hours in the wake of the murders at Brown University.

This is the mayor who demanded this mural come down.

Two structures in conflict - 6622 above, 6598–6602 below. The battle was real, but the edge belonged to the bulls. Bids didn't just hold, they refreshed. Upside moves were impulsive; downside moves weren't. That distinction matters. You don't have to trade intraday to use this. Context reads like that, sharpen entries regardless of timeframe. Most traders skip the exercise. That's why most traders get filled poorly. My process. Not trading advice.

$SPY A strong rally in S&P futures after the close has the overnight session pointing toward 636 in SPY - if those gains hold into the open. That's the first thing to watch tomorrow morning. Not as a SPY trade, although that's certainly an option. But rather as a read on whether the broader market has any room to give the stocks and ETFs you're actually trading. That's the point of this framework. SPY is the locomotive. Whatever you're holding - equities, sector ETFs, individual names - they're riding behind it. If the engine stalls, the car doesn't keep moving. Right now the engine is pointed at 636 as the immediate level, 631-632 as the floor. But the level that actually changes the picture is 649. That orange band is where the bulls either make a case or don't. Hold above it and there's room. Reject it and the structure is telling you something about every position in your book. Add the option levels at 630, 635, and 640 and you've got clear markers on both sides. Watch what the market does at those levels. That's not forecasting - that's just knowing where the decisions get made. 649 is the one that matters most tomorrow.

Pretty interesting 'fist fight' going on here at ~6420-6427 - clearly an aggressive buyer but being countered by a passive seller. If that seller slows down, we're poised for a rip to the upside. Observation - reading the tape - not a trade recommendation.

While the 'genie' may be out of the bottle, so to speak, one has to wonder if prediction markets ultimately don't run into some serious regulatory issues. This article about 'bettors' from prediction market sites threatening an Israeli journalist begins to cross lines that are just not tolerable. techdirt.com/2026/03/19/pre…

$SPY Level-to-level trading (BLUE highlight) remains the norm. The range between levels is wide enough for opportunities. Only a break above/below will offer up some range expansion.