Why Most Algos Die Young: A Manifesto
The market isn't a physics problem. It's a psychology problem. Why context, not just price, is the key to survival.
I remember the first time I turned a bot on. It felt like magic. I had written code that could print money while I slept. Then I experienced the first time a bot turned on me.
It was trading a mean-reversion strategy on ETH. It worked perfectly in the backtest. It worked perfectly for two weeks. Then, Elon Musk tweeted. The market didn't mean-revert. It trended. Hard. My bot, oblivious to the tweet, kept shorting the rip. It shorted, and shorted, and shorted, until there was nothing left to short with.
My bot died because it was a Black Box. It knew the price. But it didn't know the world.
Most algorithmic traders treat the market like a physics problem. They believe that if they just find the right combination of indicators—RSI < 30, MACD crossover, Bollinger Band squeeze—they can predict the future.
This is the Black Box Fallacy. It assumes that price is the only variable that matters. But price is just the shadow cast by the object. The object is Information.
- Price tells you what happened.
- Context tells you why.
Your algo died because it was trading a picture of the past, while the rest of the market was trading the future.
The next generation of alpha isn't about faster execution. It's about Smarter Context. It's about building systems that don't just see a candle, but understand the environment that created it.
A strategy that works in a low-interest-rate environment will get slaughtered in a high-rate environment. If your bot doesn't know the difference between a "Fed Day" and a "Holiday," it is flying blind.
Crypto is driven by narratives. "DeFi Summer." "NFT Mania." "AI Coins." These aren't mathematical constants. They are psychological waves. TickCatcher provides the metadata you need to quantify these waves. We don't just give you the price of an AI coin; we give you the volume dominance of the entire sector.
Is the market trending or ranging? Most bots have a "hard-coded" regime. They are always mean-reverting. A smart bot detects the regime first, and then selects the strategy.
"The market changes its mind. Your code must change with it."
We built TickCatcher not effectively to give you more candles. We built it to give you Vision.
We want you to build bots that are robust, not because they are complex, but because they are aware. Bots that know when to sit on their hands. Bots that know that when a stablecoin de-pegs, the RSI doesn't matter.
Stop building Black Boxes. Start building Glass Houses.
See the market clearly. Trade the truth.
