TA self fullfilled prophecies... what a joke. | Page 3 | Forex Factory

Options

Go to
Permalinks
Print Thread

Similar Threads

To what extent do self-fulfilling prophecies move markets? 5 replies

Attachments: TA self fullfilled prophecies... what a joke.
Exit Attachments

TA self fullfilled prophecies... what a joke.

  • #41
  • Jan 3, 2009 8:32am Jan 3, 2009 8:32am
pffft who cares?

it's all semantics anyways. random or not, you're beating around the bush. the question is. are YOU making money?

does this prove/disprove market randomness? don't know, don'tcare. but im certianly not gonna make any assumptions about it
  • #42
  • Jan 3, 2009 10:05am Jan 3, 2009 10:05am
Quoting tdion
Solid proof? Did you say solid proof? It's pretty obvious that myself and others would welcome any sort of sensible evidence that that there is order. So, by all means, lay out away.
Awesome!
Now we can settle this debate once and for all. LOL
  • #43
  • Jan 3, 2009 10:19am Jan 3, 2009 10:19am
Quoting Bluehills
pffft who cares?

it's all semantics anyways. random or not, you're beating around the bush. the question is. are YOU making money?
Does he trade??
  • #44
  • Jan 3, 2009 10:20am Jan 3, 2009 10:20am
Quoting FXSurfer
Awesome!
Now we can settle this debate once and for all. LOL
I dont think the market is random. I just think the people who are not turning a profit are basing their decisions on Irrelevant information, therefore their trading is random.

Thats just an opinion,

Leon
Living the adventure in my head.
  • #45
  • Jan 3, 2009 11:45am Jan 3, 2009 11:45am
Quoting tdion
Solid proof? Did you say solid proof? It's pretty obvious that myself and others would welcome any sort of sensible evidence that that there is order. So, by all means, lay out away.
To ask for solid proof is to ask for someone to show you how they predict market movement on a regular basis. Such evidence would disprove randomness, as you cannot consistently predict the outcome of something random. So to ask this question is to ask for a successful trader's edge, their system, their reason for taking a trade to begin with. It is a cheap question. As I mentioned in my previous post in this thread, laws and concepts and theories and tests have been applied on the market to argue for or against randomness, but in reality the answer is simply found in the successful, as they out perform the odds that randomness cannot produce. Therefore the final argument you will encounter that has any weight on your perception of market randomness comes when (if) you finally achieve success on a long term level. At that point the answer is very clear.

I have already briefly described how I feel about randomness in a different thread not too long ago. But since this thread has ventured into that area then for the sake of discussion I will quote it here:
Quoting Gaston
In a generalized view, I believe that the markets are not random, but it can often appear that they are. Please follow my logic. Every time price moves up or down, even by one point, then someone just participated in the market for a reason. Reason opposes randomness, and as such discounts it. To anyone who was informed of who influenced the market to move that 1 pip, or better yet WHY they entered the market, the move was reasoned, not random. However, this same movement might be perceived as random by anyone who does not know why price just acted as it did. Someone a million miles away saw price go up 1 pip, had no idea why, and states, "The markets are random". The difference between the two observations is information, or knowledge. Therefore, randomness can be perceived through unawareness, ingnorance, or by any other means lack of knowledge.

So, my view is that markets are random if you do not know why price is behaving the way it is. This concept applies to other areas as well, take baseball for example. If I had never been exposed to the sport, never played it or watched it, and was taken to a game, I might make an assumption that the players are acting out of randomness. To me it would look like they are just throwing the ball for no reason, running in circles, and people are clapping all the time. I would not be able to make any predictions about future behavior of the players at this time. If, however, someone next to me explained the rules of the game and why people were behaving as they were, then it would make much more sense to me and no longer be random. It would be reasoned, and I could make assumptions on what players are going to do next, based on this reasoning.

So, to rationalize the market, it is my belief that you must know why price is moving, otherwise you are trading randomness. Is it possible to know why every pip moves the way it does? Of course not. But if you can understand even one reason why price will behave a certain way at a certain point or at a certain time, then you can profit from this, as it is no longer considered random.
Headline: USD drops due to news of USD dropping!
  • #46
  • Jan 3, 2009 12:05pm Jan 3, 2009 12:05pm
Quoting Leonlorenzo
I dont think the market is random. I just think the people who are not turning a profit are basing their decisions on Irrelevant information, therefore their trading is random.

Thats just an opinion,

Leon
I love this post. I would add one thing: There are random events that can change price for a while....but nobody can predict a terrorist attack, for example.

However, in general, price is not random. There are S/R lines for a reason.
  • #47
  • Jan 3, 2009 1:56pm Jan 3, 2009 1:56pm
Random or not, it consistently makes a fool of many.
Money Talks. Wealth Whispers. Charts Talk. Traders Whisper.
  • #48
  • Jan 3, 2009 1:59pm Jan 3, 2009 1:59pm
It is quite amazing to see that the majority of the people "believe" that the markets are not random.
If the opposite of random is predictable how comes that the same people don't have a system or indicator that can predict the market moves.

It means also that that majority of people believes that there is a system or indicator out there that can predict the market but that they still have not found it. It also means that they will spend (or waste) a lot more time to find that system or indicator.

It is also strange that those people don't realize that there are thousands of people over the years here on this forum and on moneytec and on trade2win and thousand of other forums in other countrys and forums that are interested in other markets such as the ER or ES or the YM or the BUND or the QM or stocks or options etc that have spend all together millions of hours to find such a system or indicator and did not find it.
But still they believe it exists or is somewhere out there.
Instead of using a little bit of common sence and use the opposite logic. Meaning that as long as they did not find that system or indicator, to accept that there is no system or indicator that can predict the markets.

And it is not because one has a trend following system that is highly profitable that one has a system that can predict the markets. That is because they use their MM in such a way (the size of the S/L and the size of the T/P) that one has a highly profitable system but again that is not the same as having a system that on itself can predict the market.

If you want to proof that you have a system or indicator that can predict the market moves or cycles then the only way to do this is with a system that has a hitrate that is clearly higher then 50% and a net T/P that is at least equal or bigger then the net S/L and on different markets and over longer periods of time.
I say net because there are systems out there that come very close on doing so but the moment you add the spread then the edge is completely gone. One can easely say that the spread that one has to pay is the same as the zero on a roulette table or the edge that casino's have, and makes it that the brokers always win. No matter that you have a losing or winning trade.

If you still don't have such a system but still going to look for it, I wish you lots of luck and even more patience on your quest.....
forexflash
  • #49
  • Jan 3, 2009 2:24pm Jan 3, 2009 2:24pm
Quoting FOREXflash
It is also strange that those people don't realize that there are thousands of people over the years here on this forum and on moneytec and on trade2win and thousand of other forums in other countrys and forums that are interested in other markets such as the ER or ES or the YM or the BUND or the QM or stocks or options etc that have spend all together millions of hours to find such a system or indicator and did not find it. But still they believe it exists or is somewhere out there.
Good post, history repeats over and over, nobody learns, everybody is right, everybody else is wrong. As I said before the basic randomness is easy to analyze with basic mathematical tools, yet everybody just ignores this 800lb Gorilla...sod this, I'm off to play Golf.
The breaking of a wave cannot explain the whole sea.
  • #50
  • Jan 3, 2009 2:27pm Jan 3, 2009 2:27pm
Quote
If the opposite of random is predictable how comes that the same people don't have a system or indicator that can predict the market moves.
Go here:
http://www.forexfactory.com/showthread.php?t=141866

There exist systems w/ positive expectancy.

My "9 or better" game works perfectly to explain this issue. It's basic conditional probability.

Quote
That is because they use their MM in such a way (the size of the S/L and the size of the T/P) that one has a highly profitable system but again that is not the same as having a system that on itself can predict the market.

MM provides no edge. Even the best MM in the world will not turn a negative expectancy system into a positive one. Altho there exist numerous psychological factors that can turn a positive expectancy into a negative one.

Quote
Good post, history repeats over and over, nobody learns, everybody is right, everybody else is wrong. As I said before the basic randomness is easy to analyze with basic mathematical tools, yet everybody just ignores this 800lb Gorilla...sod this, I'm off to play Golf.

Nod. Except for times when it isn't random... the market is. Sometimes there IS a higher probability of the next X ticks being up or down.
  • #51
  • Jan 3, 2009 2:32pm Jan 3, 2009 2:32pm
If someone would have said to me a couple of years ago that the markets move random, I would also not have accepted that. The main reason would have been that I was working with 3 software packages Metastock Professional, Amibroker and MT4. Looking to charts with a arsenal of more then 500 indicators after reading 20-30 books after spending tens of thousands of hours on develloping my own indicators and programming systems and learning how to trade for years, easely spotting support and resistance, trend channels, triangles H&S etc and then need to admit that my neighbour could just as reliable predict a move by flipping a coin...it would have made me feel very uncomfortable not to say stupid.
forexflash
  • #52
  • Jan 3, 2009 2:52pm Jan 3, 2009 2:52pm
Again and again, what drives the markets or the profits that one makes does not proof that the markets don't move random. Those are totaly different elements.
As in wikepedia is clearly explained that economist have historically accept the random walk theory. I believe that they will have done a serious and reliable and analitic amount of tests. Who are we to say that they are all wrong. Who are we to say that what we can read on wikipedia is a bunch of crap?....
http://en.wikipedia.org/wiki/Random_walk_hypothesis
http://en.wikipedia.org/wiki/Random_walk_theory
forexflash
  • #53
  • Jan 3, 2009 2:53pm Jan 3, 2009 2:53pm
I agree and your broker fully appreciates your business

Quoting HeikenAshi
someone will make money consistently
It's me...
  • #54
  • Jan 3, 2009 3:08pm Jan 3, 2009 3:08pm
Quote
If someone would have said to me a couple of years ago that the markets move random, I would also not have accepted that.

And you would have been right, too. Hehe.

"Random" means a 50% chance of it going up, and a 50% chance of it going down. Right? Simple definitions are best.

So all one needs to do is prove that there are times when there's a >50% chance of something happening. Naturally then if there's a <50% chance of something happening, then the opposite should have a >50%, right? So all you really need to prove is that at some point or time there's a non 50% chance of something happening.

Need more proof? Take a random 50/50 walk and collect data, determine the distribution of that data, the mean, the standard deviations, etc.

Now, take the market's data. Do the same. Compare the distributions, means and deviations. You'll find that the 2 do not match. Daily trend behavior skews the distribution away from random.

Quote
How does that make you feel? Keep searching, think outside of the screen hopefully you guys will find it.

Sentiment happens before price, price happens before indicators. Figure out market sentiment and find your edge. I don't see why this is so difficult.
  • #55
  • Jan 3, 2009 3:28pm Jan 3, 2009 3:28pm
I have a question about Fridays movement in EURUSD.... Why did EURUSD not move to 2.0000 on Friday? This is only six thousand pips away. Someone help me here. I think its a perfectly legitimate question.

Regards,

Scotty B
Attached Image (click to enlarge)
Click to Enlarge Name: ff21.gif Size: 19 KB
  • #56
  • Jan 3, 2009 3:31pm Jan 3, 2009 3:31pm
Quoting Scotty B
I have a question about Fridays movement in EURUSD.... Why did EURUSD not move to 2.0000 on Friday? This is only six thousand pips away. Someone help me here. I think its a perfectly legitimate question.

Regards,

Scotty B
It did in another universe!

Also, I think Schrodinger's cat got hit by a bus in that universe on the same day, while playing in a cardboard box.
  • #57
  • Jan 3, 2009 3:33pm Jan 3, 2009 3:33pm
To be more precise....in 7th dimension!
forexflash
  • #58
  • Jan 3, 2009 3:36pm Jan 3, 2009 3:36pm
But seriously, why in a market as random as the forex did this not happen? I am baffled by it.
  • #59
  • Jan 3, 2009 3:38pm Jan 3, 2009 3:38pm
Quoting Rabid
So randomness is like God? Hehe.
.
No, I would say "random" isnt, by definition. Although, one word that is thrown around a lot in these random discussions is "luck", which is the very definition of out of control, superstition, we arent in control of our own lives (meaning something else is, but who, where, why?) etc. By definition a person that leaves his house and doesnt know where he is going until later is technically "walking randomly". Thus it is easy to prove randomness in some senses. Not in the market though.

This is why I agree with Tdion that most of what we see IS random, not all of it though. If you stalk the person leaving his house and he turns West instead of East, although he is in fact walking randomly and doesnt himself know where he will end up, nor do you, being the persistent observer you may be able to make a fairly reliable guess as to where he ends up. The problem with these markets in comparison to this ... metaphor, is I always find myself trying to decide where the man will go the second he exits the home and doesnt even start walking, which often is the only way to make money. Or, I dont decide where the man is going until he is there, thus it is too late.

Quoting tdion
Solid proof? .
Does the HKMA thread I created equate to proof of non-randomness? Like I have said, it is random to us likely with 95% of its total movement. However, there are moments of non-randomness to simple people like you and I, thus I am one to believe those with more insight that have been doing things longer have lowered their perceptions of total market randomness. Or, perhaps even better, they dont care whether it is random or not because they can make money?
The market is my nation. Traders, my family. Hello, brothers and sisters!
  • #60
  • Edited Jan 4, 2009 6:25am Jan 3, 2009 3:38pm | Edited Jan 4, 2009 6:25am
It's not random after it's quantified into probabilities. Can we move on to more important things? Like shorting the GBPJPY this week.
Money Talks. Wealth Whispers. Charts Talk. Traders Whisper.
0 traders viewing now