Forex market physical characteristics

Hello everyone, I don't know if this kind of topic has been existed before or not, so if i made double post of the same kind of topic please point/guide me to the existed one.

Okay, the topic I want to know / discuss is just like this thread's title, The physical characteristics about market, you guys may also put in any other markets, but the only points are about objectivities of the market. Please note that subjectivities (the things you guys seeing from your goggle/judgment) are supposed to not be included. And because I put this thread in the Discussion subforum so this thread will not be a one man show, I want you the experienced traders or new traders all give some entries because I just like any other new unexperienced trader, I knew so little about this Giant ocean markets, and also what I know are what I got from other member's thread, so I will give credits for those members as I quoted not so precisely from them. And here you may also deny what is written if you can proof that it's wrong or don't work all the time


Here we go, what I know for now :
1. Price will either move above or below any single reference point in some periods of times (any single price value) [credit for esuffw, sorry if I am spelling your nick wrong]

2. 95% of the time Price will close above or below it's opening value, and less of 5% of the time price will close at it's opening price [credit for CrucialPoint]

3. what is going up will be going down and vice versa (credit for Nanningbob]

4. Price is moving because of orders, market orders or pending orders

5. there is no one way move periods in all time frames altogether, even in strong trending days like 2008, there will be corrections in smaller time frames

6. There will be no exact / absolute highest or lowest price in any market (except 0)

7. When price move up at any period of time, it is because there are more buying orders that are willing to be placed at the given price than selling orders at the moment, and vice versa.

That's all I've got for now, will add more later if find other new, please share yours

Problem with market characteristics mentioned here is that its not critical information.

"1. Price will either move above or below any single reference point in some periods of times (any single price value) [credit for esuffw, sorry if I am spelling your nick wrong]"

How about stating that the market have only two directions. This is a fact that many traders can't/refuse (to) believe.

"2. 95% of the time Price will close above or below it's opening value, and less of 5% of the time price will close at it's opening price"

Doesn't help you. What is more interesting is that most currency-pairs have 70% probability to fill its daily average range.

Thanks for the input sir, the essences of these characteristics depends on what strategy can people design to trade based on these characteristics. When it is obvious, anybody can get rich based on this stuff right?

So, what I got from your post is " 70% of the times, most currencies pair are likely to reach its Daily average range "

I may have your permission to put that line at the first post with some adjustment.

Your input is much appreciated

continue...

9. Price fall much quicker than it rise

10. Trading via any brokerage is a minus sum game

11. There is no way to know for sure whether a S/R level will hold

what?

where are you getting this info from? it's understandable that perhaps stocks might fall quicker than they rise, but where do you get the idea that forex moves quicker on bearish moves? there's no reason for that to be true that i'm aware of. if you have a link to some research on this that'd be interesting to read.

trading is not a negative sum game. you and your account will experience a negative sum game when opening and closing orders, but trading as a whole is not negative sum. all money comes in and out and goes somewhere. none is magically created or lost. stuff like this is just asking for reams of pages of people arguing semantics.

Technically, they are correct about #10. Trading with a broker is a negative sum game because as you said, "no money is magically created or lost" and the broker does charge a spread/commission. This is not to be confused with the possibility that one can profit. It only means that not everyone can breakeven. It also means when someone wins, someone else along the line lost (true for zero sum as well).

Hello sir, I have no valid research that being based upon. What I stated is purely based on my observation on price movements from 2006 in major pairs, and because I am very new in this business that's why I open this thread so we can discuss, share, conclude, approve or reject any idea given, it is fine if you didn't get me right, as I am here to learn from others, especially other experienced traders, and by this post I may also learning from you

Anyway, why can't it be understood that price falls quicker than it rises? any reason except I am enclosing no valid research?

About the minus sum games, you or I may get it right/wrong anytime soon

there just isn't any reason i can think of at this time as to why a currency pair would fall faster than rise. over a certain timeframe a currency pair might be more bearish than bullish. i think in this case you are simply biased in your perception of the charts. it's natural to look at anything as falling faster than rising since we base our experience in gravity which draws everything towards the ground, so when you look at a chart you perceive downward movements to be of greater force and speed than upward movements which you naturally expect to immediately decelerate.

if you took your charts and flipped them upside down you would probably still come to the same conclusion that the downwards movements are faster than the upwards movements... and if this is true then what does that say about the presumption of faster bearish movements in general? it means it's not true and is purely perception playing tricks.

i'm not saying i'm right. i'm just saying it doesn't make sense as a statement on it's own without something to back it up. there's no mechanics in play that i can think of to make this statement in any way true.

it's not like stock trading where most people base their perceptions on a buy then sell process and have an aversion to bear rallies, and where it's less common for participants to short sell or naked short sell stocks. if most participants have a natural desire to only go long then bull bubbles will surely burst hard and cause crashes as everyone scrambles to exit a failing long position. or perhaps that's just my own assumptions and perceptions.

Markets move in trends. Trends move in waves. Waves are Impulsive and Corrective. Trade the impulsive moves.

Here's what the $1.2 Trillion money manager had to say in his April 2011 outlook:

I sit before you as a representative of a $1.2 Trillion money manager, historically bond oriented, that has been selling Treasuries because they have little value within the context of a $75 Trillion total debt burden. Unless entitlements are substantially reformed, I am confident that this country will default on its debt; not in conventional ways, but by picking the pocket of savers via a combination of less observable, yet historically verifiable policies - inflation, currency devaluation and low to negative real interest rates. - Bill Gross, Head of PIMCO

http://seekingalpha.com/article/2700...le-dip-happens

Figure out about why prices will fall quicker than it rise, think about its changes in percentage terms, for example :

product A initial prices was 10.000, say that in a year, the price went up 20%, so the final price will be 12.000, means that it was moving 2.000 pips up in a year, then, in the next year, the price fall 20% to 9.600 (for this down move, 2.400 pips in a year), this example may show you that in a same percentage rising or falling it is obvious that it moves quicker when falling than raising. Think about that!