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Forex is random

  • #201
  • Apr 5, 2020 12:03am Apr 5, 2020 12:03am
Quoting RickM
{quote} There was a reason for that spike and the one on the previous day as well but you need to trade with a historical mindset. We are trading on an old battlefield that is scarred from previous price action, one that has two major hidden gaps. I suggest you revisit February 1999 and March 2003 to see what happen. A gap can be visible or hidden and can be filled with ease but a vacuum zone is a gap that may never be filled - The Algorithm isn't smart enough to know the difference. {image}
Newzealand is a currency used by big market makers to do readjustments.
New zealand is one person Central bank . It is not a committee running the central bank.
Sterling Pound flash crash and many other minor crashes are caused by NZ currency without any basis.
If you keep this in mind, you will understand .
Only two currencies can't be moved by NZ flash crashes. Euro and Yen. Rest are vunerable to NZ flash crashes.
Practice makes a person perfect
  • #202
  • Apr 5, 2020 12:41am Apr 5, 2020 12:41am
Quoting Rennaissance
A spike is a non random action we all agree. The problem is how to develop a method to take advantage of it consistently. They certainly don't repeat in a similar fashion. Even if it is an inefficiency, it's a one time thing.
You are not allowed to use historical data since you assume price is random.

You are not allowed to use any form of math since math is based on historical data which according to your assumption is random.

Your assumptions created your problem.

The more assumptions the bigger the problem.
Know what you trade
  • #203
  • Apr 5, 2020 4:53am Apr 5, 2020 4:53am
Random has two components.

1. Future price is independent of past prices, and

2. Future price is unbiased.

If future price is biased long or short then Forex price cannot be random.

Future price is biased and independent of past price. That's the nature of Forex.
Know what you trade
  • #204
  • Apr 5, 2020 6:26am Apr 5, 2020 6:26am
The whole "Forex is random because random numbers generated on a chart looks similar" thing is a logical fallacy.

Just because random numbers generated on a chart creates a similar looking chart to an actual market, for example EUR dollar vs USD, does not mean that the market movements of a particular financial instrument is random. The market is a real thing, with real buyers and sellers entering the market at different prices. You need to understand why the market moves, who makes it move, and the different players to see that it is not a "random walk". The market movements occur due to supply and demand. This is how and why all markets move, it is literally that simple...

A random number generated chart does not work this way, it only appears to be similar because it is plotted on a similar chart, but the reason for the movements are not the same.

The question of whether or not you personally can extract profits from trading is not due to the market being random, it has to do with yourself and your own limitations of knowledge, experience, and risk tolerance.

Look at what is going on with the stock market right now due to the coronavirus, or what recently happened to OIL due to supply and demand, and competition with an emerging market in electric energy...These things are not random. This is a logical fallacy and people need to stop comparing the two.

It is not a conspiracy, the market is a real living breathing thing with real buyers and sellers. It's just that most of the buyers and sellers in Forex are not doing it to make a profit, they are simply exchanging currency in order to use it.
  • #205
  • Apr 5, 2020 7:17am Apr 5, 2020 7:17am
Quoting viptrading
The whole "Forex is random because random numbers generated on a chart looks similar" thing is a logical fallacy. Just because random numbers generated on a chart creates a similar looking chart to an actual market, for example EUR dollar vs USD, does not mean that the market movements of a particular financial instrument is random. The market is a real thing, with real buyers and sellers entering the market at different prices. You need to understand why the market moves, who makes it move, and the different players to see that it is not a "random...

If the forex market was a living breathing entity based on supply and demand wouldn’t the ability to reverse a market after three years exactly to the pip be a massive coincidence. Smaller coincidences happen continuously whereby targets are taken out by fractions of a pip, or missed by fractions of a pip.
Each to their own and that’s the reality of a forum but I just don’t buy into supply and demand, fundies or its news driven...I really do think that it’s an Algo that has been programmed to ‘appear’ to react to news, fundies etc..my best guess is that it has a requirement to ‘behave’ for a preplanned percentage of time, where it can appear to be a natural market, but for brief periods it’s allowed to max out...’spike’ as long as it’s bought back into a predefined range within an agreed period of time, otherwise the markets could have a ‘runaway effect’ like a nuclear reactor if they weren’t closely monitored and controlled.
Just my thoughts and observations, not out to step on toes or change anyone’s opinion.
  • #206
  • Apr 5, 2020 7:47am Apr 5, 2020 7:47am
Quoting moodybot
{quote} If the forex market was a living breathing entity based on supply and demand wouldn’t the ability to reverse a market after three years exactly to the pip be a massive coincidence. Smaller coincidences happen continuously whereby targets are taken out by fractions of a pip, or missed by fractions of a pip. Each to their own and that’s the reality of a forum but I just don’t buy into supply and demand, fundies or its news driven...I really do think that it’s an Algo that has been programmed to ‘appear’ to react to news, fundies etc..my best...
I don't think what you are talking about has anything to do with what I am talking about. If you believe that the market moves based on some algo then you should probably provide some evidence for that.

Supply and demand is not a belief, it is a fact. It is literally what is taught in schools across the world and how people have been trading and valuing things for all of human history. The only difference here is that you can plot it on a chart and trade it.

What you view as coincidence is your personal interpretation and you are drawing conclusions from this. If there are times that price reversed to the same area e/g stops taken out there are also times that price may hit your tp and reverse right after, it is just a coincidence. There probably is some truth to Forex being manipulated by brokers and banks, but mostly on smaller time frames, if you use tight stops, this is why I do not use stop losses.

Even though markets are manipulated they still have to move based on supply and demand eventually, so after stops are taken out this is why the price will eventually go where it needs too. Based on orders that real people make, big players, and institutional traders. Its the small fish that get stopped out and fucked over, but that problem really only exists in Forex, and not in other markets such as Futures which are much more centralized.

Also, the type of behavior you are talking about is immoral and not legal in most countries, but sadly it still happens. You must understand this manipulation and take account for it when making trading decisions.

At the end of the day though, your point about market manipulation has nothing to do with supply and demand, they are both real things, but one is an actual fundamental of markets, where as the other is manufactured and used to take peoples money, usually those with smaller account balances who do not use proper risk management, e.g small fish in order to fill their pockets.
  • #207
  • Apr 5, 2020 8:09am Apr 5, 2020 8:09am
Quoting viptrading
{quote} I don't think what you are talking about has anything to do with what I am talking about. If you believe that the market moves based on some algo then you should probably provide some evidence for that. Supply and demand is not a belief, it is a fact. It is literally what is taught in schools across the world and how people have been trading and valuing things for all of human history. The only difference here is that you can plot it on a chart and trade it. What you view as coincidence is your personal interpretation and you are drawing...

If you can prove to me that the chart I attached to post 146 was the result of supply and demand then I’ll reconsider but at the moment after 10 years with all of this, I just see targets with the Algo first setting up then systematically searching them out. For every target taken out, a fresh target will be left.
Thanks for taking the time to reply
  • #208
  • Apr 5, 2020 8:36am Apr 5, 2020 8:36am
Quoting moodybot
{quote} The difference between your random charts and a real chart.......this perhaps may go someway in showing the difference. A gap on the EURUSD around 21st April 2017 price 1.07776............ Almost 3 years later, the gap was finally closed on 20th February 2020 and price stopped and reversed 700 pips, the price........1.07776 To exactly close a 3 year gap, reverse 700+ pips would be an incredible coincidence if it was a randomly generated chart. I take the view that we are dealing with a highly controlled Algo.. It's job is to entice traders,...
Again, just because the price reversed at this point does not mean it is due to some top secret algo of the invisible market maker lol. This move is most likely a result of orders being filled due to supply and demand at that similar price, pending orders, possibly a very large order at that price that caused the market to to reverse at that price, possibly a TP was triggered for a very large order, who knows. That is most likely what happened, and why the price reversed at that area to the pip, if you look you will see that that area is an area of support where buyers seemed to come in multiple times at the past, and that is the same reason why the gap occurred in the first place, because of traders entering the market and buying in at that price.

Also, this was post number #161 not 146, and it is on page 9, for anyone else who wants to see what we are discussing I believe that is the one you were referring to.
  • #209
  • Apr 5, 2020 9:37am Apr 5, 2020 9:37am
Quoting moodybot
{quote} If you can prove to me that the chart I attached to post 146 was the result of supply and demand then I’ll reconsider but at the moment after 10 years with all of this, I just see targets with the Algo first setting up then systematically searching them out. For every target taken out, a fresh target will be left. Thanks for taking the time to reply
markets behaved basically the same 100 years ago, when there were no Algos
  • #210
  • Apr 5, 2020 9:41am Apr 5, 2020 9:41am
Quoting viptrading
{quote} Again, just because the price reversed at this point does not mean it is due to some top secret algo of the invisible market maker lol. This move is most likely a result of orders being filled due to supply and demand at that similar price, pending orders, possibly a very large order at that price that caused the market to to reverse at that price, possibly a TP was triggered for a very large order, who knows. That is most likely what happened, and why the price reversed at that area to the pip, if you look you will see that that area is...
I don't believe we are talking about a top secret Algorithm that has a special code planted by a market maker to hunt down targets hundreds of pips away, but rather a Auction Algorithm that's coded to entice traders into grouping passive orders together into tight clusters before running their stops. It does appear however to have a basic flaw. In grouping these orders into pools, it creates space and areas of thin liquidity on either side of these clusters.
This is the problem because it can't regulate its speed.

When speed increases 2-4 times like it does in micro space, it normally forces a change of direction as seen in a pullback (wide ranging candle as another example)
When speed increases 5-12 times within a major gap like Moody was talking about, it normally changes the whole direction of the market.
The market makers do not move the market or change direction of the market, they just add liquidity.
Demand and supply are just fancy names for a pool of orders each side of current price.

Somehow, the Algorithm seems to sense where these major gaps lay even from hundreds of pips away. My trading buddy thinks its voodoo when I nail trade after trade to the pip trading these gaps. It does feel like the Algo is hunting these gaps down like a dog by taking small steps at a time until the target is hit.

The proof can be seen on any chart where a major gap lays just like Moody laid out.
Trading thin liquidity at the boundary of the charts
  • #211
  • Apr 5, 2020 9:47am Apr 5, 2020 9:47am
Quoting karuner
{quote} markets behaved basically the same 100 years ago, when there were no Algos
No it doesn't, you have not opened your eyes.
Trading thin liquidity at the boundary of the charts
  • #212
  • Apr 5, 2020 9:50am Apr 5, 2020 9:50am
Quoting RickM
{quote} I don't believe we are talking about a top secret Algorithm that has a special code planted by a market maker to hunt down targets hundreds of pips away, but rather a Auction Algorithm that's coded to entice traders into grouping passive orders together into tight clusters before running their stops. It does appear however to have a basic flaw. In grouping these orders into pools, it creates space and areas of thin liquidity on either side of these clusters. This is the problem because it can't regulate its speed. When speed increases 2-4...
Are you talking about the GAPS somewhat like MESCH method?

Inserted Video
Since Frank Sinatra sings in his own way, my chart sing... I did it, my way
  • #213
  • Apr 5, 2020 9:50am Apr 5, 2020 9:50am
Quoting RickM
{quote} No it doesn't, you have not opened your eyes.
Everyone tells the other guy your eyes have not opened yet. This is weird.

Nobody is going to post proof of this and that. Stop asking for proof.

Trade whatever narrative that suits you.
Waste time try to convince the other guy.
We all know what we know.
Nobody will reveal it on forum.

We all agree that market is not random.
That's good enough.
Know what you trade
  • #214
  • Apr 5, 2020 9:55am Apr 5, 2020 9:55am
Quoting karuner
markets behaved basically the same 100 years ago, when there were no Algos
As long there's a market it remains the same forever.

Losers say market has changed.
Know what you trade
  • #215
  • Apr 5, 2020 10:01am Apr 5, 2020 10:01am
Quoting viptrading
{quote} Again, just because the price reversed at this point does not mean it is due to some top secret algo of the invisible market maker lol. This move is most likely a result of orders being filled due to supply and demand at that similar price, pending orders, possibly a very large order at that price that caused the market to to reverse at that price, possibly a TP was triggered for a very large order, who knows. That is most likely what happened, and why the price reversed at that area to the pip, if you look you will see that that area is...
My thoughts on supply and demand: the more buy orders come in the market the more price will go down to hunt their stops. And vice versa.

Should at some point some sellers are in profit, the price will go for their stops, but in such a manner that will keep the buyers in a loss, b/e or maybe a small profit. So as they are not able to close their positions.

After they finish the business with buyers they will restart the cycle in the other direction.
On ignore list of scammers, deceivers and low IQ individuals. Exclusively
  • #216
  • Apr 5, 2020 10:01am Apr 5, 2020 10:01am
Quoting RickM
{quote} I don't believe we are talking about a top secret Algorithm that has a special code planted by a market maker to hunt down targets hundreds of pips away, but rather a Auction Algorithm that's coded to entice traders into grouping passive orders together into tight clusters before running their stops. It does appear however to have a basic flaw. In grouping these orders into pools, it creates space and areas of thin liquidity on either side of these clusters. This is the problem because it can't regulate its speed. When speed increases 2-4...
If you choose to believe that this is what makes the Forex market move to be honest I do not care. The fact is there is no proof for such claims other than "its in the charts bro look". So, whatever. But, at the end of the day the point is that markets are not the same as a random walk. That's the only real point here. The market moves based on buyers, and sellers, big players, and small players alike contribute to these fluctuations in price, economic events etc. If you want to believe in conspiracy theories then that is fine but at the end of the day it doesn't even really matter.
  • #217
  • Apr 5, 2020 10:07am Apr 5, 2020 10:07am
Quoting bfx17
{quote} My thoughts on supply and demand: the more buy orders come in the market the more price will go down to hunt their stops. And vice versa. Should at some point some sellers are in profit, the price will go for their stops, but in such a manner that will keep the buyers in a loss, b/e or maybe a small profit. So as they are not able to close their positions. After they finish the business with buyers they will restart the cycle in the other direction.
No, that is not how it works. I am pretty sure stop hunting is not a thing, and if it ever does happen its illegal activity that probably happens on a very small scale with bucket shop brokers. But, even if it is a real thing, the solution is just don't use stoploss. There are many ways to trade, and you do not need to use a stoploss in order to protect your money, but that is another topic.

Honestly I feel like this is just an excuse people make when they cannot succeed in trading, just like people in real life who make excuses for not being successful, and blame it on "the man". Even if it is true, there is always a way around anything in this world if you put your mind to it.
  • #218
  • Apr 5, 2020 10:10am Apr 5, 2020 10:10am
Quoting viptrading
{quote} No, that is not how it works. I am pretty sure stop hunting is not a thing, and if it ever does happen its illegal activity that probably happens on a very small scale with bucket shop brokers. But, even if it is a real thing, the solution is just don't use stoploss. There are many ways to trade, and you do not need to use a stoploss in order to protect your money, but that is another topic. Honestly I feel like this is just an excuse people make when they cannot succeed in trading, just like people in real life who make excuses for not...
Sure man. We can agree to disagree...i think it is fair
Cheers,
B
On ignore list of scammers, deceivers and low IQ individuals. Exclusively
  • #219
  • Apr 5, 2020 10:42am Apr 5, 2020 10:42am
Quoting RickM
{quote} No it doesn't, you have not opened your eyes.
what an argument. here's my retort:
you can't see the forest for the trees.
  • #220
  • Apr 5, 2020 10:50am Apr 5, 2020 10:50am
  •  Ekim7
  • | Joined Nov 2019 | Status: Having the time of my life | 70 Posts
Life is random, the universe favors laws of entropy. Why would Forex be any different?
Just try to pick realistic battles, and I'm sure you'll see success through persistence.
You should really listen to what Davit says
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