We chat with Dan Ushman from TrendSpider. A new automated charting tool that helps technical analysis stock traders. Here's Dan!
Can you tell us a little about your back story and how you ended up with the idea for TrendSpider?
I’ve been an entrepreneur for over 15 years, and I have a passion for starting technology-based businesses that solve problems through automation, and I’ve been an on/off active swing trader since 2008, and absolutely love the complexity and efficiency of the financial markets. TrendSpider is an exciting opportunity for me to combine my two passions into one project and solve a real problem with technology, help a lot of traders like myself, and build a business in the process.
The idea is simple: On days when I traded before TrendSpider, I would find myself spending more time preparing to trade than trading.
My day started at 5am by making a watch list using a screener like FinViz, then an hour of flipping through charts looking for setups that I liked. When I saw a chart that looked interesting, it would spend another half hour digging into it, switching timeframes, drawing trendlines, and deciding if I wanted to trade it. I also spent a lot of time second guessing my analysis, which I found frustrating. Eyeballing charts ain’t easy!
When I finally found something that looked solid, I would then annotate the chart, open it up and stare at it until the trade setup. This sometimes meant paying attention to a chart for hours or days until price approached my buy zone. It was tedious, as you probably know. And after all that effort, I still sometimes lost money when the trade would go against me and hit my stop.
In my other businesses, I always looked for something that people had to do by hand, and found a way to automate it. I decided to explore attempting to do the same for chart analysis. I pulled a team together, we built an MVP and started recruiting beta testers and trading with it ourselves. We found that not only did it save us a ton of time, but it improved our timing, helped us be honest about trades, removed bias, and more. Our beta users became very active and passionate, and with that encouragement, we decided to commercialize it and launch it to the public.
After a year of development, we opened our doors in early March 2018. So far almost 2,500 traders have signed up, and we are working on the next version of the tool. It’s been a great ride so far, can’t wait to show the world what’s next :)
Tell us about TrendSpider, how is it different from other charting tools?
TrendSpider is a fully automated, real-time chart analysis system for active traders. It supports stocks, cryptos, ETFs, forex, and a number of other assets. And it is VERY different than anything else out there - it is the first and only system of its kind.
From a high level, it’s designed to assist traders with technical analysis & to be simple and easy to use. When a user inputs a symbol into TrendSpider, it automatically downloads 320 candlesticks of data for the symbol on 10 different timeframes (from 1 minute candlesticks all the way up to 1 week candlesticks). Then, its algorithms simultaneously analyze each timeframe individually, attempting to identify every single possible trendline on the chart.
Our thesis is simple: because there are 10,000s of traders playing with every tradable security out there, and they all use different trading software, different styles of analysis, different timeframes, different chart styles, etc. it is very likely that most of them see different patterns, setups, key price levels, etc. Ask 100 traders about any chart, and it is likely you’ll get 75 different answers.
At the same time, there are lots of traders holding bags or stalking entries who missed their opportunity to get in or get out on any particular stock, so they are sitting, waiting for their next chance. If they missed their exit at $10, they’ll sell at $9.90 next time just to get out. If they missed out on their entry at $5, they’ll buy at $5.50 just to get in if it ever dips back down that low. Others will chase. It’s very chaotic when you think about all of this happening at the same time. And it is this dichotomy that makes automated analysis so powerful because by finding ALL possible trendlines, and then applying a mathematical scoring system (that the user can customize) to filter out the weakest lines, we can find trends that most traders miss that are the sum of all their behavior. This makes trendlines detected by TrendSpider very useful in a number of ways. Finally, since we believe in helping traders, not replacing traders, the user can then “fine tune” the analysis by “locking” trendlines that were hidden by the algorithms.
Another part of our thesis is that long term trends are far more likely to be ‘respected’ by short term price action than short term trends are. And since TrendSpider analyzed 10 timeframes from the get go, trendlines from one timeframe can be plotted on the chart of anther. This is called “Multi-Timeframe Analysis” and by using it, you can trade the Weekly moving averages or trendlines on the 5 minute chart. We like to describe this as the ability to see the forest AND the trees, at the same time. It’s unbelievably powerful, and nothing else out there does it.
TrendSpider doesn’t stop at just trendlines, It can also automatically identifies candlestick formations, finds breakouts, measures fibonacci retracements, and much, much more. All in seconds, so you don’t have to do it by hand.
Once you see a setup you like, you can TrendSpider can watch the chart for you, dynamically. That means if your plan is to buy XYZ when it bounces off the 50 day SMA, you can have TrendSpider alert you when a 5 minute candlestick touches it. The alert will stick with the indicator (or trendline) no matter where its wave and slope takes it. You’ll never have to adjust a price alert again.
It’s this combination of features that makes TrendSpider unique. As far as I know, there is nothing else out there that even comes close. And I’ve looked :)
As a long-time member, how is Hashtag Investing different from other stock investing chats, forums, and/or communities?
In researching this project, I dove into the online trader community. I signed up for dozens of trading chat rooms, alert services, communities, forums, and got to know what other traders pains are.
I learned that there are a lot of people taking advantage of new traders, I discovered that there is a lot of “following” behavior and junk being thrown around. There are chat rooms that exist solely to take advantage of the people who pay to access them. It’s a crazy, wild, Wild West part of the world.
My goal with TrendSpider was to build an honest, customizable, easy, powerful system to help traders. I felt a lot of these services did the opposite.
So when I came across Hashtag Investing, it immediately stood out. First, there was a conspicuous lack of bullshit… pardon my French :) There were a lot of active traders, different styles, all in one place, and there wasn’t the same follow-the-leader mentality that you find in a lot of other places. Everyone was sharing ideas and discussing trades openly, there was meaningful and thoughtful debate, you could chat about whatever you needed to chat about, and no one was blindly buying or selling what someone posted into the room. I thought that was unique and it created an interesting atmosphere where traders actually shared ideas with each other in real time. It’s a place where traders can learn from each other. That was unique and I felt it aligned with what we’re trying to do at TrendSpider. It’s not about offering trading tips or alerts, it’s about offering real value to traders.
During your early phases for TrendSpider, you used Hashtag Investing as a resource to help get feedback. How was that experience for you and how did it benefit you?
We wanted to build a tool that traders would actually want to use, so we reached out to Harvi and asked if he would be willing to invite his members to beta test TrendSpider. He agreed and dozens joined. The feedback we received was exceptional, and the community was not just warm and welcoming, but excited about the concept and interested in actually using it.
Through feedback from the community, we came up with some amazing features that we implemented - and that’s a big deal to us because we’re traders too and we really want our platform to be the only technical analysis tool a trader would ever need. We can’t do that on our own - feedback from users is critical.
What is your vision for TrendSpider? What's coming up in terms of new functionality and features?
The vision is to build the best damn technical analysis platform we can. Something that we want to use ourselves as we trade every day. Something that blows traders minds when they first try it out. We think we’re close, but know there is a lot more we can do. One of those things is expanding our dynamic alerts to cover more chart scenarios.
Currently, alerts can be set on any trendline or indicator, and can notify you when a candlestick on any timeframe bounces, touches or breaches. We want to expand that so you can get indicator cross alerts, lower indicator divergence alerts, alerts when a particular chart forms a hammer candlestick on the daily timeframe, etc.
We are planning to expand alerts from single symbols to entire watch lists, so the system can alert you the moment the XX period moving average crosses a Weekly trendline on any symbol in your list. Or when any symbol on your list forms a hammer candlestick formation on the 1 hour timeframe. Whatever you could dream up.
Once we perfect our analysis capabilities, we will build a mobile app so users can use TrendSpider on the go, and potentially expand into other markets around the world.