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

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TA self fullfilled prophecies... what a joke.

  • #61
  • Jan 3, 2009 3:48pm Jan 3, 2009 3:48pm
Because their are Idiot traders like bluffers and manipulators with lots of money that pray on this type of behavior.

Just my 2 cents Rab

Quoting Rabid
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.
It's me...
  • #62
  • Jan 3, 2009 3:50pm Jan 3, 2009 3:50pm
Quoting StockKJay
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...
Doesn't the man know he is leaving home? Can he walk as far away from home as he wants. Where does he live?
  • #63
  • Edited 4:32pm Jan 3, 2009 4:18pm | Edited 4:32pm
You can go short GBPJPY all day long while we continue this discussion. Come back to the thread if you feel like it.

It is important to know whether the markets are random because otherwise your profits are just luck..... all your chatter about "ALL THAT MATTERS IS I'M MAKING MONEY" is moot when it can dry up at any time.... all because your trading method had you fooled by randomness (not that yours does, but in general)

By the way, in the PM you sent, you said Steinitz is a modified Heiken Ashi. Whether it is modified or not, it used pure Heiken Ashi candles. And what are Heiken Ashi candles in reality? Nothing more than deviations between moving averages. Theres nothing magical about that. If you believe MA crosses are predictive, then you drank that Koolaid.

Quoting HeikenAshi
It's not random, which allows it to be quantified into probabilities. Can we move on to more important things? Like shorting the GBPJPY this week.
  • #64
  • Jan 3, 2009 4:20pm Jan 3, 2009 4:20pm
I agree with Stockjay except for one thing.... the man is never at home! He is always walking..... price never stops ticking up and down..... there is no start and end point, it is a perpetual walk through eternity!

Quoting Scotty B
Doesn't the man know he is leaving home? Can he walk as far away from home as he wants. Where does he live?
  • #65
  • Jan 3, 2009 4:23pm Jan 3, 2009 4:23pm
And a lot of corporations changing their money to pay their workers. Speculative traders (like us) make up less than 5% of the market..... the rest are simply doing business, not trying to profit.

Quoting AgentFx
Because their are Idiot traders like bluffers and manipulators with lots of money that pray on this type of behavior.

Just my 2 cents Rab
  • #66
  • Jan 3, 2009 4:30pm Jan 3, 2009 4:30pm
HKMA thread? What does that stand for?

I have yet to see rabid or anyone else lay out any real plan for deriving probabilities. It is the same old junk science argument that trading is probability driven. I want to know how you quantify sentiment. How do you factor in market efficiency (the lack of time required for the market to equilize to fair market value) These are the REAL questions....

Quoting StockKJay
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?
  • #67
  • Jan 3, 2009 4:35pm Jan 3, 2009 4:35pm
So as I already asked..Why did EURUSD not go to 2.000 on Friday?
  • #68
  • Jan 3, 2009 4:43pm Jan 3, 2009 4:43pm
I see your point, and it is a genius way to shut me up

Let's just say that it COULD have gone to 2.00 on Friday, had there been drastic unexpected news. Remember Enron? It lost all of its value overnight.

If I tell you to draw the 2009 EURUSD chart today, you can't do it because you don't have enough information. So if you claim order exists, what do you need to start drawing your forecasts? This is the thing nobody seems to be able to answer.... exactly what their probabilistic "forecasts" are based on.

Quoting Scotty B
So as I already asked..Why did EURUSD not go to 2.000 on Friday?
  • #69
  • Jan 3, 2009 4:46pm Jan 3, 2009 4:46pm
Quoting tdion
I see your point, and it is a genius way to shut me up

Let's just say that it COULD have gone to 2.00 on Friday, had there been drastic unexpected news. Remember Enron? It lost all of its value overnight.

If I tell you to draw the 2009 EURUSD chart today, you can't do it because you don't have enough information. So if you claim order exists, what do you need to start drawing your forecasts? This is the thing nobody seems to be able to answer.... exactly what their probabilistic "forecasts" are based on.
It seems like you are mixing order in the present with fortune telling. Just because there is an order to something does not give rise to predictions of it's future.

Or

are you expanding your original post that started this thread and are you adding a new dimension to your argument?
  • #70
  • Jan 3, 2009 4:51pm Jan 3, 2009 4:51pm
Thatwasme...are you still using PCCI?
forexflash
  • #71
  • Jan 3, 2009 4:53pm Jan 3, 2009 4:53pm
Quoting tdion
I see your point, and it is a genius way to shut me up

Let's just say that it COULD have gone to 2.00 on Friday, had there been drastic unexpected news. Remember Enron? It lost all of its value overnight.

If I tell you to draw the 2009 EURUSD chart today, you can't do it because you don't have enough information. So if you claim order exists, what do you need to start drawing your forecasts? This is the thing nobody seems to be able to answer.... exactly what their probabilistic "forecasts" are based on.
what do you need to start drawing your forecasts?

An initial move and a pullback.
  • #72
  • Jan 3, 2009 4:54pm Jan 3, 2009 4:54pm
Quoting FOREXflash
Thatwasme...are you still using PCCI?
It is an interesting idea, based on digital signal processing, however, that has never been the way I trade. I trade from Accumulation and Distribution from non time frame specific data. I look for congestion areas.

I am always looking at other people's approaches though. I know only that I do not know.
  • #73
  • Jan 3, 2009 5:02pm Jan 3, 2009 5:02pm
First let me say, tdion, I always like your posts. You know how to get people going, more importantly though, you get people thinking.

You mentioned Enron. What a silly story it was. Yes it did fall over night.. But why? Was it's fall random, or was it the logical outworking of a problem of huge proportions.

The goal of my posts is to try and point out that there are rules that govern the universe. This includes price charts, logic, driving, walking talking ect...
Logic could not exist without the under-girding existence of order.
  • #74
  • Jan 3, 2009 5:08pm Jan 3, 2009 5:08pm
Quoting tdion
... one thing.... the man is never at home! He is always walking..... price never stops ticking up and down..... there is no start and end point, it is a perpetual walk through eternity!
Well, the man can take a rest. Some Holidays and most weekends the price just sits there. Hmmmm, is that random ?? I don't know,.... the randomness here is caused by buyers and sellers.
Just like at the Grocery Store. If I - all of a sudden - needed 2000 hamburgers, that would seem random to the Grocery Store. But not to me.
If some corporation - all of sudden - buys a few yards of Euros, that seems random to us. But not to them. They just found themselves in need of some hamburgers.
Now,... if the market is ranging,... that's all pretty random.
But, if the market breaks out, and the breakout trader snags 80 quick pips, is that random ?? This is a guy who waits for the breakout and takes it without fail according to a plan. A good win rate with "disciplines and trade managements". Consistent success like that isn't random.
Maybe there is method to it's madness.....
  • #75
  • Jan 3, 2009 5:17pm Jan 3, 2009 5:17pm
I just wanted to share a couple verses from the book of Romans that I believe take the principles we are speaking of to their final conclusions. Once we can admit that there is amazing order in our universe, what do we do with that information? Sure we can profit from price charts, but can we see past the grave that awaits us all? I submit to you all that it is worth the time and energy to pursue the order giver.

Romans 1:19-20

since what may be known about God is plain to them, because God has made it plain to them. For since the creation of the world God's invisible qualities—his eternal power and divine nature—have been clearly seen, being understood from what has been made, so that men are without excuse.
  • #76
  • Jan 3, 2009 5:38pm Jan 3, 2009 5:38pm
Quoting HeikenAshi
It's not random, which allows it to be quantified into probabilities. Can we move on to more important things? Like shorting the GBPJPY this week.
This misunderstanding is the principle reason why this thread is in place to begin with. Random events are the ONLY things that have probabilities. Sit down with a statistics book and it will all make sense.

Not the markets.. that takes years of study to "make sense". If you want your answer, tdion, you have to keep on doing what you've been doing.. watching and learning from the data. Your performance (the ability to gauge probabilities) does increase with experience, if you are bright (and I know you are). These threads are never going to teach you anything, including what I wrote here. And no, speculators are not 5% of ANY market. We wouldn't be in such deep shit as an economy if that were the case, would we? Every single equity management company in the country is a speculator of some sort. They just vary in how they speculate, and what the assets are.

Here's to good luck, and a profitable 2009.
Virtue finds and chooses the mean. Aristotle, Ethica Nichomachea
  • #77
  • Jan 3, 2009 6:31pm Jan 3, 2009 6:31pm
Quoting Scotty B

Romans 1:19-20

since what may be known about God is plain to them, because God has made it plain to them. For since the creation of the world God's invisible qualities—his eternal power and divine nature—have been clearly seen, being understood from what has been made, so that men are without excuse.
Sorry, I cannot accept this, because it is circular logic. A premise can never be evidence for a conclusion.
  • #78
  • Edited 7:19pm Jan 3, 2009 6:48pm | Edited 7:19pm
Yes, the point of the thread is that it is random to you and me. There is generally a reason for every price movement, but because we do not know what it is, it is perceived as randomness, and therefore we should accept it as random because we will never have all the answers.

Quoting Scotty B
Once we can admit that there is amazing order in our universe, what do we do with that information?
Hey Plutonite, I always enjoy your posts.... almost consider it an honor that you stopped by. You and I are both graduate level computer scientists, and as you can imagine, I have used extreme pattern recognition techniques in the EAs I write.

BUT

I am convinced that nobody really knows anything. Case and point: look at EURUSD the past month.... a 2000 pip move..... which has not been seen in over 8 years..... so any pattern recognition software should have a problem coping with an extreme phenomenon such as this (which it has not been trained to deal with.)

Supposing you rewrite your EA to profit from huge moves like in December, it will fail when the markets return back to their "traditional" waxing and waining.



Everybody here needs to understand that I am a trader. I have several thousand $$ of investment capital from 3rd parties that I am responsible for. And I always tell the investor "we will make money if the markets keep doing what they've always done historically." But they understand that this is a high risk game, and that any TA based trading robots have deadly weaknesses.
  • #79
  • Jan 3, 2009 7:03pm Jan 3, 2009 7:03pm
Quoting thatwasme
Sorry, I cannot accept this, because it is circular logic. A premise can never be evidence for a conclusion.
The problem of circular arguments lie within almost every "religion". Everyone either implicitly or explicitly uses some kind of circular argument when defending his or her ultimate authority or belief. For this is the nature of an absolute authority, who by nature is truth. Even if you say, "I believe there is NO ultimate authority because I do not know of any such ultimate authority", you are making a circular argument. Therefore, to have any belief, you must at some point accept a circular argument, even if you are claiming that you are the absolute authority for truth.

I have my own beliefs regarding the verse above etc, but that is both outside the context of this thread and this site in general, so I will leave that out.
Headline: USD drops due to news of USD dropping!
  • #80
  • Jan 3, 2009 8:16pm Jan 3, 2009 8:16pm
Quoting tdion
Yes, the point of the thread is that it is random to you and me. There is generally a reason for every price movement, but because we do not know what it is, it is perceived as randomness, and therefore we should accept it as random because we will never have all the answers.



Hey Plutonite, I always enjoy your posts.... almost consider it an honor that you stopped by. You and I are both graduate level computer scientists, and as you can imagine, I have used extreme pattern recognition techniques in the EAs I write.

BUT

I...
Tdion,
I don't understand you. Either you are real successful trader trying to confuse the enemy .. (the rest of us) or your a lousy trader trying to discourage others. Personally, I think there are only 2 reasons for the market to move. --- which is the basis and value of all moves. This can't be measured in statistical terms but there are close measures in the market that the trader can use to make themselves a lot of money. Only a fool would say you can build an ea off a backtest or elliot wave curve software and be successful. Ea's must be adaptive in nature and take what the market gives. Just because smart people say that can't be done...doesnt mean its not been done already.
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