Glitches for Riches: Part II

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I hope you all found my introduction to glitch trading helpful. If you haven’t read it yet, I recommend doing so before diving into this, part 2 of Glitches for Riches.

Now, let’s jump into part 2 and my guide to finding glitch strategies.

The Right Mindset

Becoming a glitch hunter starts with a radical shift in how you view the markets. The efficient market theory is dismissed, and while technical and fundamental analysis aren’t ignored, they take a secondary role. Instead of focusing on complex technical patterns or dissecting earnings reports, the glitch hunter zeros in on flaws in the market’s structure—arbitrage opportunities, inefficiencies, and repeating patterns. A glitch trader is best described as a scavenger, thriving on the overlooked scraps left behind by larger players.

Observation and perseverance form the backbone of glitch hunting. It demands countless hours scrutinizing market maker boxes, scanning charts for peculiar candle wicks, and searching for arbitrage opportunities. This pursuit requires a hacker’s mindset—always looking for what's broken.

Once you uncover a glitch, act swiftly and exploit it thoroughly. Glitches are inherently short-lived, and it’s only a matter of time before they’re discovered by others—whether savvy traders or lightning-fast algorithms. To stay ahead, remain vigilant, decisive, and adaptable, always prepared for the moment the game changes.

The Right Friends

In 2008, as the global financial system unraveled, it unleashed a torrent of market volatility—the kind traders live for. What followed was some of the most exhilarating and profitable trading of my career. Yet, the massive profits my colleagues and I reaped didn’t come from obvious plays like shorting bank stocks or other force-fed traditional strategies. Instead, our success stemmed from glitch strategies, with the lion’s share of our gains coming from exploiting a hidden flaw in the mechanics of closing market auctions—a structural glitch buried deep within the system.

What made this even more remarkable was the source of the discovery. It wasn’t a seasoned pro who uncovered this goldmine, but a green rookie fresh to the trading floor. Whether out of extraordinary generosity or sheer naivety, he chose to share his findings with the team. What followed was a feeding frenzy as we collectively capitalized on this edge-laden glitch, turning it into an eight-figure windfall in just a few months!

The purpose of this story isn’t just to highlight the profit potential of a glitch—it’s to emphasize that the best way to uncover these golden strategies is often to have them handed to you (or, perhaps, to "borrow" or "steal" them). In trading, there are no rewards for originality. One of the greatest advantages of working in a team of traders is the ability to share ideas and strategies. Of course, not everyone is as generous as the trader I mentioned earlier; many keep their secrets close for good reason—most strategies aren’t scalable. Nonetheless, by collaborating and sharing insights, you place yourself in a position to benefit from the discoveries of others, while also contributing your own findings.

It’s not just a friend who might hand you an incredible glitch strategy—I once stumbled upon one buried deep in the depths of YouTube. Now, I’m not saying you should solely rely on YouTube or social media as your primary source for trading education or strategies, but if you can sift through the noise and separate the gold from the garbage, you might just uncover a hidden gem every now and then.

The Right Markets

Of course, you can’t wait around for the moment that someone hands you a winning lottery ticket. Good traders actively search for their own glitches. While this path is challenging, the process of discovering and refining a winning strategy can be one of the most fulfilling parts of trading. Creativity is crucial here—it’s refreshing to inject some imagination into a field that often penalizes overthinking.

To craft your own glitch strategy, begin by examining markets that are known for inefficiency, fragmentation, and high volatility. These chaotic environments are filled with untapped opportunities. Additionally, focus on markets where automated trading has not yet fully taken over. While finding a market that meets all of these criteria can be challenging, or even nearly impossible, the crypto markets come close. Despite the growing presence of trading bots, the sector remains fragmented, inefficient, and volatile—making it an ideal playground for glitch hunters.

While crypto might be the prime hunting ground right now, it’s far from the only option. Equity markets, for instance, have been a goldmine for glitch strategies. In fact, most of my own profits—and those of many equity traders I know—have come from these opportunities. Futures markets, too, are ripe with glitch-based strategies, where traders have consistently turned inefficiencies into gains. As I highlighted in part one, through the painful story of being caught on the wrong side of a computer monitor glitch trade, glitches aren’t exclusive to financial markets either—they can also be found in online marketplaces.

And here’s a little secret: my attention has recently turned to Polymarket, a prediction exchange. This market, still in its infancy, is highly inefficient and largely untouched by bots. Staying ahead means always scouting for the next big thing. Early entrants into crypto trading five to ten years ago found some of the glitchiest—and most rewarding—markets I’ve ever seen. Upcoming markets, such as Polymarket, might just hold similar potential.

The Right Tools

To develop an effective glitch strategy, you need the right tools. The magical glitch strategy from back in 2008, for example, was only made possible because we had access to a relatively unknown data feed. The successful glitch hunter is equipped with high-quality trading hardware, software, and data feeds. Without a clear view of the market’s inner workings and order flow, you're essentially flying blind. Key tools such as market-depth data (Level 2 in stocks), auction data, market filters, and fast, reliable execution are all crucial for spotting and exploiting glitches. Finding the right resources to uncover these inefficiencies is a vital part of the journey, as many valuable software and tools are available depending on the market you trade in.

The Right Time

Timing is crucial in the art of glitch hunting. While it may take months or even years to develop a solid glitch strategy, persistence alone isn't enough—success also depends on identifying the optimal times to trade.

For me, the sweet spot lies in striking when most bots and traders are offline. Almost all of my trading activity—and the bulk of my profits—occurs during the glitchy U.S. equity premarket session. This premarket window starts at 10 a.m. European time, making it an ideal opportunity for European traders to engage. In the U.S., however, this translates to trading between 1 a.m. and 4 a.m., when only the most dedicated and elite traders are awake to take advantage of the rich, glitchy opportunities these hours provide. I also know equity traders who consider the U.S. after-hours session to be “glitch-friendly,” and I've heard of glitch-hunting futures traders who operate during very peculiar hours to capture similar opportunities.

As illustrated by the story of the rookie trader who generously shared his strategy, volatility is a glitch hunter's greatest ally. When volatility spikes, the market structure often bends and breaks, creating a wealth of glitches. As a result, volatile periods and markets are typically the most lucrative times to search for glitches, leading to the largest profits. In fact, my profit-and-loss curve closely mirrors market volatility—most of my gains have been concentrated in just a few of the hundreds of months I’ve spent trading.

The Right Event

Many glitch strategies revolve around what I refer to as “trading events.” These are unique opportunities, such as index rebalances, IPOs or ICOs, market opens, or market halts—essentially anything outside the normal rhythm of market activity that exploits inefficiencies in the market structure. A standout example I’ve highlighted before is the remarkable profitability of market auctions over the years.

I vividly remember my time at an old office in Texas, where, a handful of times each year, the usually quiet space would suddenly come alive. For about 30 minutes at the close of the markets on key days for closing auctions, traders I hadn’t seen in months would show up and rake in five or six figures in mere minutes. 

This again highlights the critical importance of timing in glitch trading. A skilled glitch trader knows exactly when these golden opportunities are likely to emerge. It also underscores the power of these strategies—when you uncover a glitch, just a few minutes of effort can yield four, five, six, or even seven-figure profits. I’ve seen it happen.

Conclusion

I’m not the type you find online promising to hand you a magical trade. Instead, my goal is to teach you the mindset that will provide the easiest path to trading success and empower you to find or build your own plans and strategies. As the saying goes, “Give a man a fish and feed him for a day; teach him how to fish and feed him for a lifetime.”  And trust me, a skilled glitch trader doesn’t just eat—they feast.

I will finish with what I wrote in part 1: Glitch trading may not interest you, or you may feel you are not suited to this style, and that's fine, but I want to point out how the majority of successful traders I know make a big portion of their profits, and the type of strategies that we found offer the greatest edge. Even if you prefer other forms of trading, the aim of the game is to make as much money as possible. My advice would be to follow the path that would give you the best chance of achieving that goal, especially as the luxury of consistently making money from your preferred style of trading is rarely afforded.