Unlocking the Subconscious
Using audio and other clues
I was doing some non-trading work on my trading computer one day at around 13:45 EST and had the charts hidden in the back ground. I have some audible alarms which let me know when the market is up to something and triggers me to switch to the charts to see what is going on.
(One of these alarms in the Pit Simulator which audibly alerts me when volume picks up in the market and the other is TimerA1 which tells me when the NYSE TICK is hitting extremes.)
I heard a couple of unusual sounds that meant that something was moving in the market and before I switched to the charts I already knew that the noise was telling methat it was the tail-end of an up move. When I switched to the charts I discovered that I was right - it was exactly as I had imagined it. I think that I have now been listening to these sounds for long enough that I can recognize (at least my subconscious can recognize) the sound signature (audio pattern) that certain market moves make.
This is not very useful so far because it is after-the-fact. Audibly I was able to tell what the chart looked like by listening to a sound pattern. Remember that the two audio alarms that I listen to do not distinguish between up and down moves, they only tell me if there is (1) unusual activity in volume or (2) an extreme is being experienced. The up or down extreme is not distinguished by different sounds although this would be a trivial modification to make. I just don't feel that this modification is necessary or useful. The question is, how did my subconscious know that it was an up move?
Training the subconscious
I am now considering the possibility of trying to train my subconscious to recognize audio market activity which leads to a market move which I can then take advantage of. This is a noble concept and may be possible. At the moment, I'm still trying to work out where I would start a project like this. While thinking about this I realized some important facts.
The audio alerts that are being produced on my computer are very simple and could easily be mathematically and programmatically recorded and analyzed. In fact you could skip the audio part altogether and just take the parameters in the indicators and generate a table of "signals" that produce each sound (there are only two different sounds) and then try and work out which pattern produces what type of move. Essential you are just turning each sound alert into an indicator which can then be plotted on a chart or back tested.
So why don't I do this? Well, as I mentioned above, I have not worked out (my subconscious has not worked out) a sound pattern that leads to a market move. It has only managed to distinguish a sound pattern that signals the end of a move. However, that may have some use as well. A pattern that signals the end of a move would let you know when to take profits and exit a position. I also face the problem that it is my subconscious that has figured this out and not my conscious so I cannot quantify what my subconscious has figured out.
There is another inherent problem with using the subconscious to pick up audio alerts that may signal the start of a move. Your state-of-mind changes significantly when you are flat and when you have a position on. Say your subconscious starts recognizing an audio pattern that precedes a down move. Let's also say that you had a position on each time this happened so your mind was at a state of heightened alert. Now let's also say that your mind also processed that same sound pattern the same number of times but when you were flat and each time under this scenario the market moved up. I am speculating here, but I believe that the positive/negative feedback loop to your brain and subconscious will be stronger for the times when you had a position on. So although this sound pattern has a 50/50 outcome for predicting a market move in either direction your subconscious has it tied with a down move.
Thinking out alound
You have probably realized by now that I am just vomiting my thoughts onto the keyboard at the moment in order to capture and share them with you in order to provoke some dialogue. I believe that the subconscious' ability to process pattern recognition is enormous and if we can tap into it could produce huge results. In fact I believe that the subconscious is responsible for a lot of 'paranormal ESP' so called predictive-ness. For example, the phone rings and your subconscious tells you that it is going to be so-and-so on the line and it is. How did your subconscious knowthis? It could knowthis because it has processed a pattern of past behavior. This person calls at regular intervals or at the same time of day. This person always calls shortly after a certain event (sports, anniversary etc.) has happened.
The subconscious could also pick out visual patterns from a chart but I believe that this is far more difficult because the patterns very rarely repeat themselves with enough regularity for this association to happen. You may also have the chart reader suppressing the subconscious (unintentionally) while reading the charts. The absorption of sounds while watching chart patterns develop is not a conscious effort and so association can be left to the subconscious.
Article Originally Published: 8 June 2006 (Updates to article are made when more information becomes available and if errors are found.)
(I re-read this article on 10 June 2006 (two days after writing it) and realized that it is not that well written so I will try and rewrite it or rephrase it or continue it in a more coherent matter at some point in the future. However, I believe that most people reading this material are not interested in pretty pose but want to get trade ideas and methods to increase their profitability and I hope that this material will help some of you. It is unlikely to be of immediate help to you but will allow you to keep your senses open to trading opportunities and perhaps develop another sense that will make you more profitable.)