Do you believe this market is random? | Page 32 | Forex Factory

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Do you believe this market is random?

  • #621
  • May 31, 2014 7:19am May 31, 2014 7:19am
If the market is random, ALL of the following must be true:

1) Support and Resistance do not exist
2) Trends do not exist
3) Cycles do not exist
4) Nothing that happens ever has an effect on anything else that happens

That's it guys. If you believe all that, WHY ARE YOU HERE?????

Please. No more nonsense about the market being random. It is silly.
  • #622
  • May 31, 2014 7:33am May 31, 2014 7:33am
Quoting Fractalist
If the market is random, ALL of the following must be true: 1) Support and Resistance do not exist 2) Trends do not exist 3) Cycles do not exist 4) Nothing that happens ever has an effect on anything else that happens That's it guys. If you believe all that, WHY ARE YOU HERE????? Please. No more nonsense about the market being random. It is silly.
Why do you make those conclusions. For example, I can flip a coin and plot a random walk from it, and there may indeed be a large upward trend on the plot.
  • #623
  • May 31, 2014 7:39am May 31, 2014 7:39am
This discussion has became chaotic and irrational ,you are still re-discussing the same fact that we discussed 20 pages ago and already came to a conclusion.

You guys are starting to talk BS.

Unsubbed.
"There's a sucker born every minute" - P.T. Barnum
  • #624
  • May 31, 2014 7:42am May 31, 2014 7:42am
These threads are funny, they go around and around seemingly in circles. But at the end of the day they are metaphors for the market itself. Everyone offering their own perspective of things and taking a "position". (The Forum owners take the spread.. The Traffic =P)

A profitable trader tares his hair out listening (reading).

What's clear in all of it though are peoples obsession with the need to define and reason everything, one way or the other.

The market works on different levels at anyone time. As humans we've been geared from day one to view and define things in a logical and digestible fashion. What's right whats wrong whats big whats small whats cold whats hot whats ugly whats beautiful..... What's Bull whats Bear

That's where rookies spend their education, slowly realizing that although the market may go from A-B and whoever bought at A and Sold at B is "Correct" and made money. The Market in this process actually went back to A twice before running to C and down to -A the back to A and a half.. When you add the combinations or as many like to call "random walk" the market took from A to B you start to realize that ... I can't be bothered finishing this post
like totally failure brah
  • #625
  • May 31, 2014 7:47am May 31, 2014 7:47am
Quoting simonb
These threads are funny, they go around and around seemingly in circles. But at the end of the day they are metaphors for the market itself. Everyone offering their own perspective of things and taking a "position". (The Forum owners take the spread.. The Traffic =P) A profitable trader tares his hair out listening (reading). What's clear in all of it though are peoples obsession with the need to define and reason everything, one way or the other. The market works on different levels at anyone time. As humans we've been geared from day one to view...
lol, a good post.
  • #626
  • May 31, 2014 7:48am May 31, 2014 7:48am
Quoting SupraSense
{quote} lol, a good post.
glad you got a boner
like totally failure brah
  • #627
  • May 31, 2014 7:57am May 31, 2014 7:57am
Quoting simonb
{quote} glad you got a boner
It wasn't that good. Maybe you could include a pic of Mila Kunis next time to make the post even better
  • #628
  • May 31, 2014 8:30am May 31, 2014 8:30am
Quoting SupraSense
{quote} Depends what you mean by pattern. There are underlying patterns which occur again and again and which lead to greater than 50% probability of a win, but they're not patterns like a pinbar or a doji (liek you say, these are a bit like 50-50 in the long run). There's something much deeper there, and perhaps you haven't found it yet. Then again, entries is less important than how you manage the trade to exit, yet everyone is looking for a pattern for their entry rather than a pattern for exit.
oh please stop with this bull..."theres something deeper there" you're believing an illusion to allow you to trade.... ok, here's your chance, give me this pattern, deep or otherwise that you have found and that I "haven't found yet" - any one, and what it's hit rate?.... you wont be able too, you will have some excellent excuse how this 'pattern' deep or otherwise, that you have found, can not be written down....

The reason I haven't found the pattern is because I know you don't need a pattern. The reason everyone is looking for an entry pattern, why do you think that is? because it exists? or because they need to believe it exists?
tradewith60
  • #629
  • May 31, 2014 8:30am May 31, 2014 8:30am
Quoting SupraSense
{quote} It wasn't that good. Maybe you could include a pic of Mila Kunis next time to make the post even better
lol
like totally failure brah
  • #630
  • May 31, 2014 8:33am May 31, 2014 8:33am
Quoting Proximus
This discussion has became chaotic and irrational ,you are still re-discussing the same fact that we discussed 20 pages ago and already came to a conclusion. You guys are starting to talk BS. Unsubbed.
this discussion is not chaotic it is random
tradewith60
  • #631
  • May 31, 2014 8:51am May 31, 2014 8:51am
Quoting 60minuteman
{quote} oh please stop with this bull..."theres something deeper there" you're believing an illusion to allow you to trade.... ok, here's your chance, give me this pattern, deep or otherwise that you have found and that I "haven't found yet" - any one, and what it's hit rate?.... you wont be able too, you will have some excellent excuse how this 'pattern' deep or otherwise, that you have found, can not be written down.... The reason I haven't found the pattern is because I know you don't need a pattern. The reason everyone is looking for an entry...
Do you think things are bull just because you don't understand them?

As I stated, it depends on what you call a pattern. If you're referring to trade the pin bar above the moving average when stochastics has crossed (and all that nonsense) then no, there is no pattern, at least not one that lasts. If you allow a more general pattern, that is less rigid, then yes they exist and they last.

Lets try this question. Do you think there is something pattern like about market bubbles? Consider the internet bubble, a housing bubble, tulipmania, bitcoin, whatever. Isn't there a pattern there? Some sort of similarity between them. Doesn't repeat exactly the same way every time, but there is something deeper underlying it, something hard to put your finger on, but it's there, wouldn't you agree? This is not the only pattern of course, there are lots.

If you don't see any pattern there, then I can't help.

As for needing a pattern, no I don't see why you must need a pattern. If you can trade successfully and it's a method that survive the test of time, that's all that matters.
  • #632
  • May 31, 2014 8:56am May 31, 2014 8:56am
Quoting SupraSense
{quote} Do you think things are bull just because you don't understand them? As I stated, it depends on what you call a pattern. If you're referring to trade the pin bar above the moving average when stochastics has crossed (and all that nonsense) then no, there is no pattern, at least not one that lasts. If you allow a more general pattern, that is less rigid, then yes they exist and they last. Lets try this question. Do you think there is something pattern like about market bubbles? Consider the internet bubble, a housing bubble, tulipmania,...
Very good man, 60 agrees as well, he's just too good for himself to admit it.!
like totally failure brah
  • #633
  • May 31, 2014 10:44am May 31, 2014 10:44am
Quoting SupraSense
{quote} Why do you make those conclusions. For example, I can flip a coin and plot a random walk from it, and there may indeed be a large upward trend on the plot.
A "Trend" is a hypothesis of persistence. If you say that a trend is underway, you are saying that it is more likely that the current price direction will continue than for it to reverse. But a true random system has neither persistence nor antipersistence. It's Hurst value is 0.5 and so you cannot make any conclusions about the future, nor can you say that any memory process is active.

Go ahead and plot true random data and compare to real market data. They do not even look similar. Measure the Rescaled Range / Hurst Statistic on both and see what you find. Random is around 0.5 and a real market is not. Stocks have been shown to be around 0.72 (persistent) and currencies are around 0.4 (antipersistent). Futures vary, but most markets show persistence and are nowhere near random. Read Mandelbrot and Peters to see these kind of results.

On that random walk data, if it comes up heads 10 times in a row are you willing to bet it all on tails next time? Why not? Because there is no expectation that tails is going to be favored. That is NOT what happens in a real market trend. You CAN bet with the trend and be right far more often than not, and even so including the time you lose when the trend ends. There is a real persistence effect going on that can be used, and it can be measured with statistical tools.

In currencies, you can bet that the trend is going to reverse and be right more often than not.

Random is a very specific hypothesis that requires strong evidence. I see no evidence offered that had been proven to be correct. The hypothesis that makes more sense is to assume Complexity, not Randomness.

Randomness is also a very nihilistic assumption. "It is all unknowable".
  • #634
  • May 31, 2014 10:49am May 31, 2014 10:49am
Quoting Fractalist
{quote} A "Trend" is a hypothesis of persistence. If you say that a trend is underway, you are saying that it is more likely that the current price direction will continue.
I don't think so.. I think you are saying that something has happened in some kind of common and defined fashion. Nothing more, nothing less. A range trends between the walls of it's confinement... A trend is a trend.

A "trend" to a contrarian nullifies your statement about what a trend apparently is.

-1 for you sir
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  • #635
  • May 31, 2014 10:56am May 31, 2014 10:56am
Quoting Fractalist
{quote} A "Trend" is a hypothesis of persistence. If you say that a trend is underway, you are saying that it is more likely that the current price direction will continue than for it to reverse. But a true random system has neither persistence nor antipersistence. It's Hurst value is 0.5 and so you cannot make any conclusions about the future, nor can you say that any memory process is active. Go ahead and plot true random data and compare to real market data. They do not even look similar. Measure the Rescaled Range / Hurst Statistic on both and...
I disagree. A trend doesn't really exist at all. It's a measurement between two points in time and it is up or down over that time period. THe assumption that it will persist is up to the trader, but is not something that comes from the data. You may hypothesise that it will continue and take a trade, but it's not the case that it definitely will continue. So it's purely a past data tendency.

If I plot random data, and I have, then I find lots of trends. Sometimes they persist, sometimes they don't.

Random data does look very similar to real data until you know what you're looking for. But experiments have been done, and quite a large % of people cannot tell the difference between random data and real market data. Some can, which is interesting, but lets not pretend they are so wildly different. If you want I can pu up 10 charts, some real and some randomly generated. Are you really sure you can tell which is which at 100%? Wanna try?

I agree with many of your points, but purely arguing that the conclusion you made is not so straightforward. Just because something is random doesn't mean it won't exhibit trends and patterns.
  • #636
  • May 31, 2014 11:01am May 31, 2014 11:01am
Truth be told from where I am sitting and with the information that can be gotten from forex, a "trend' doesn't really matter much in the grand scheme of things. It's just a big imbalance in buying vs Selling that's all it is. The same rules apply everywhere, and a trend can end very quick or it can go on forever, so what separates a trend from a range? not much actually, just the balance of the scale is a tipped a little more on one side that is all. Thank God I don't rely on those things anymore.
Being a trader is lonely, but being a great trader is lonelier still
  • #637
  • May 31, 2014 11:01am May 31, 2014 11:01am
Quoting SupraSense
{quote} Do you think things are bull just because you don't understand them? As I stated, it depends on what you call a pattern. If you're referring to trade the pin bar above the moving average when stochastics has crossed (and all that nonsense) then no, there is no pattern, at least not one that lasts. If you allow a more general pattern, that is less rigid, then yes they exist and they last. Lets try this question. Do you think there is something pattern like about market bubbles? Consider the internet bubble, a housing bubble, tulipmania, bitcoin,...
like I said, you believe in something you can not give a clear example of - so what is it you're believing in? and you say I can't see it..."something hard to put your finger on" - so your trading is based on something you can not even explain? is that wise?As for your example, like I said, the only patterns that do exist are from fundamentals, like changes to interest rates, increases in unemployment etc etc
tradewith60
  • #638
  • Edited 11:24am May 31, 2014 11:04am | Edited 11:24am
Quoting 60minuteman
{quote} like I said, you believe in something you can not give a clear example of - so what is it you're believing in? and you say I can't see it..."something hard to put your finger on" - so your trading is based on something you can not even explain? is that wise?As for your example, like I said, the only patterns that do exist are from fundamentals, like changes to interest rates, increases in unemployment etc etc
I can give an example and gave you several. There are bubbles. Even the media can see that there is some underlying patterns, that's why they term them bubbles and not 'an increase'. Can't you see that? Even Johnny Journalist can see there is some pattern with bubbles.

What you want is for me to tell you how to apply this sort of thing to the markets, right? How rather than just be aware of this sort of thing in a vague way, you can actually put your finger directly on it and recognise what it is, right?
  • #639
  • Edited 11:47am May 31, 2014 11:17am | Edited 11:47am
Quoting 60minuteman
{quote} like I said, you believe in something you can not give a clear example of - so what is it you're believing in? and you say I can't see it..."something hard to put your finger on" - so your trading is based on something you can not even explain? is that wise?As for your example, like I said, the only patterns that do exist are from fundamentals, like changes to interest rates, increases in unemployment etc etc

This is a real pattern that makes money, not a chart pattern a money moving pattern. If 3 currencies are being bought this period more than the last period, at a higher rate than what they were being bought than before against the USD which is also being sold at the same rate or more, and if the JPY is one of those currencies, you can bet the house that the strongest currency is going to give some good pips. Go with the flow, anything else would be like trying to ice skate up hill.
Being a trader is lonely, but being a great trader is lonelier still
  • #640
  • May 31, 2014 11:42am May 31, 2014 11:42am
How can you talk about a market being truly random and talk about pairs that have positive and negative correlations at the same time? In a random market, there would be no correlation between two pairs.

Look at friday's trace of the eur/usd, the eur/aud the eur/cad, (for that matter the chf/jpy, the gbp/jpy, and the gbp/aud).

Don't they resemble a pod of dolphins swimming together? If that is your idea of random than you must be using the word quite differently than do I.

Yes some of the other patterns don't seem to show coherent patterns.

So don't trade them until they do!

All the money I made yesterday came from the dolphins. I didn't trade the others: too much noise.
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