First sacred cow: "If the trend started, it will continue" - page 10
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Now a word or two about the predictability of a trend start. Here is an axiom in logic that traders should pay attention to: you cannot predict the existence of object A with object A. You cannot predict long-term price movement based on price. You need other data. We would be much more effective at predicting future price movement based on non-price indicators.
It is better to use non-price indicators, they are much more useful.
No question - fundamental analysis. In the old days, trading stock spot, I very quickly substituted that it is much slower to lose if you flip a coin. As they say on RBC "it takes a chart and you'll find an explanation".
There is no forum without lovers of interpreting price as a random variable and I'm glad you specifically are not a supporter of this idea, which only does harm in the sense that there is a dead end ahead.
But I'm also a proponent of the idea that a price chart of just one pair, without involving information from other pairs, is almost entirely random (for those in the tank, it's almost-martingale). That's what you spend a lot of precious time on, trying to grab the martingale by the tail.
And in general I don't like it when people say something is random without specifying how random it is.
Hm, I'll share some more - there are only a few pairs, the rest I can just figure out ... :)
Please name these pairs - because I noticed that EURJPY has become more "technical" than USDJPY (my opinion)
What pairs, it's all clear: for example, all involving the quid. In principle, when playing on not quite small TFs it will work.
and here I am starting to like all pairs with the euro - what about it - where is the guarantee that the quid is the driver?
And I don't care which drivers and which drivers don't. The courses are agreed anyway, arbitration is almost impossible for us.
And in general, I don't like it when they say something is accidental without specifying how accidental it is.
Well, here we are. You have to forget that price is random, if it is random, then it is a dead end.
When a trend develops, the behaviour of the crowd is not random. I really like the concept of self-affirming and self-destructing charts. I wrote earlier on this forum in another thread.
As soon as the most advanced part of the crowd suspects the beginning of a trend, it enters the market from the cache. The demand exceeds the supply and the demand begins to equalize with the supply at the expense of the price. Less advanced part of the crowd sees the beginning of the trend and also starts to enter the market. The trend starts to confirm itself. It starts to develop just because it is marked on the chart! This is the main information upon which the most unadvanced part of the crowd makes a decision. That is why it is written that the trend is more likely to continue than to end. How long will the trend continue? The answer is until the instrument is overbought (oversold). Please note that besides the notions of "pattern" and "fractal" (according to chaos) I also introduce the notion of "oversold/oversold" into the trend concept. In fact, the trend is not a function of one "variable" - a pattern, but of a large number, and not of three.
Again on the subject of randomness. There is mass service theory, one of many theories built on the concept of random variable. It calculates perfectly the length of the queue and the waiting time in a queue of people, for example, in the underground. There are people in the underground and there are people in Forex. In the underground people generate a normal law, but not on Forex, because in the underground all the comers act independently of each other, according to their own plan, while in Forex they don't. The whole crowd, always divided into parts: up, down or seen from the outside.
In order to know which way the trend will start after a flat wandering, you need to know which saturation zone it was in...the sell zone or the buy zone...
2 Vita, joo:
So you both think it's not trader's wisdom (which I naively think it is myself), but a meaningless tautology. Right?
Lately very interesting ideas have occurred to me, when I try to comprehend just such platitudes and tautologies... The most important and first question here is: from what kind of life do they come, these tautologies, in general?
In the sense of profit, yes, it's a meaningless tautology. This tautology emerges from the experience of all those involved. Imagine an experiment. A man has to take a step forward. After he takes it, a coin is flipped. If it's heads, the step counts; if it's tails, the penalty is a step back. And so on and on. What congenial thought will the participants and observers have after a while about walking ten steps forward? That one must walk with an eagle. It is very easy, in hindsight, to see that the successful subjects walked ten steps forward under the eagle. And you can already hand out advice - to walk ten steps, you must walk with an eagle. For those successful ones, the eagle started and generally continued up to the tenth step. It is only necessary to correctly determine when the eagle stream starts, i.e. the trend. - Isn't that what the advice from gurus, researchers, semi-knowledgeable people, etc. sounds like? No one, in fact, says anything specific. Because there is no specificity. Everyone says that every type has its own way and its own system - this is because again no one knows in advance who and how lucky they will be, but once the lucky ones have been identified, you can adjust anything to their luck.
In any case, I find it almost useless to explain that there is no profit in trends, zigzags, forecasts, waves, pivot points, levels and almost anything else. Look at Matemat on grasn. On the one hand he seems to know and understand everything. And he says exactly: the reason is greed and there are no trends. On the other hand he has a rationalisation that allows him to "You can only profit from a good prediction" and "Look at my model - in fact I only predict the average." I don't want to lead your thread away, so I won't ask him anything else. What interests me is fixed - he is trying to predict the market and let's say that trends in the conventional sense have nothing to do with it, but only true averages indicating the direction of trading, still no profit there, no matter what you call it. Such examples, when a person in the abstract and applied to others is aware of greed, but in application to himself - turns a blind eye, are the fundamental basis of one more reality - in general everyone is losing on the market.
Greed is the strongest, virtually uncontrollable motivator. Greed is not a bad habit to get rid of, it is not an annoying fly to swat away, and it is not even a vice that can be cured. It is not in vain that it has been classified as a mortal sin - its consequences are inevitable and cruel, bringing sorrow and suffering to its bearer and to those close to him. As a motivator, greed uses all human knowledge to put it at its service. Hence the army of leakers in the market where they know for sure there is no profit. Hence such moments when a person says that others are greedy and do not understand that there are no trends, while I predict the future by the power of my mind. It is almost impossible to admit to oneself that it is greed that has subordinated all the power of one's mind to profit where there is none. That requires a will. If people had the will, there would be paradise, but as it is, all we have is leakers.
This is the irony, Matemat, when no one is stupid, when everyone is educated, everyone can easily argue what I wrote above, and there is no synergy. Greed, envy, etc. do not allow people to unite. In general, nothing new has been invented under these heavens, and modern alchemists are squeezing gold out of copper, even though evidence-based science says that a miracle is required. Actually, getting back to the market tautology, for me personally the phrases "you just need to select the right parameters", "if you open in time", "if you improve the closing condition", "I will soon optimize", "it will increase profitability" and the like.etc. they only emphasize more strongly that there is no definite profit, but only magic profit under magic circumstances, i.e. "if you catch a trend...".