A variant of the proof of the first axiom of Dow - page 3
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It is not the past values that are sufficient, but the past values depending on supply and demand!:)
...If an axiom can be proved, then it is already a theorem, not an axiom, and is mistakenly accepted as such due to lack of proof at the time it is accepted under pressure of available facts. Believe me, the fact that it became a theorem only benefited Doe's conjecture. 2+2=4 is not an axiom, but follows from the definition of "addition of numbers", the same about the line and 2 points, and the fact that parallel lines do not intersect also follows from the definition of "parallels". An axiom is something else, namely, a proposition or postulate accepted without proof at the time of its acceptance. If there is a proof, an axiom ceases to be an axiom and becomes a stronger concept like a theorem.
I've never heard anything like that. However, I am not a mathematician. Perhaps it is common for mathematicians to prove axioms in order to "strengthen" them, and turn them into theorems. Outlandish, of course, but maybe it's possible).
Still, why don't you want to accept the fact that the raw data for analysis determines the quality of the prediction. That is, the more and more diverse the data we have, the more "support" we have for serious conclusions?
Axiom (Greek ἀξίωμα, statement, position), postulate: a statement of a theory that is accepted by the theory as true without requiring proof and is used in proving other statements, which are in turn called theorems.
More precisely: accepted within the framework of this theoryas true due to the lack of proof at the moment of acceptance.
Did you add the correction yourself, or is it from an authoritative source? (I'm just asking.)
There's a big difference, isn't there?
"true without the requirement of proof" and"true due to lack of proof at the time of acceptance".
So, according to this logic, it is possible to accept as true something that has no proof at the current moment?
Or rather: accepted within a given theoryas true due to lack of evidence at the time of acceptance.
I've never heard anything like that. However, I am not a mathematician. Perhaps it is common for mathematicians to prove axioms in order to "strengthen" them, and turn them into theorems. Outlandish, of course, but maybe it's possible)
Still, why don't you want to accept the fact that the input data for analysis determine the quality of the prediction. That is, the more and more diverse the data we have, the more "support" we have for serious conclusions?
1. Only obvious axioms do not require proof, while Dow's statement is not obvious at all - it is his supposition and anyone is free to disagree with him. An axiom is when, forced to postulate due to impossibility to prove, it does not follow that, it does not have to be proved. It used to be accepted as an axiom that the earth is flat and everyone believed that statement. Time comes and the axioms fall apart. Now it is accepted as an axiom by physicists that the universe is expanding as a result of a big bang of a single point, as the contrary cannot be proved yet, by the available arsenal of knowledge.
2. When and where I did not accept this fact?
Did you add the correction yourself, or is it from an authoritative source? (I'm just asking.)
There's a big difference, isn't there?
"True without the requirement of proof" and"true due to lack of proof at the time of acceptance".
So, by this logic, it turns out that it is possible to accept as true something that has no proof at the moment?
2) It is an axiom before proof. It is a truth that is forced to be accepted without proof.
1. Only obvious axioms do not require proof, and Doe's statement is not obvious at all - it is his supposition and anyone is free to disagree with him. An axiom is when, forced to postulate due to impossibility to prove and it does not follow that, it does not need to be proven. It used to be accepted as an axiom that the earth is flat and everyone believed that statement. Time comes and the axioms fall apart. Now it is accepted as an axiom by physicists that the universe is expanding as a result of a big bang of a single point, as the contrary cannot be proved, so far, by the available arsenal of knowledge.
2. When and where did I not accept this fact?
2. It's not that you "don't accept" officially, it's just that you are leading us to accept the paucity of data and settle for one price. This follows from the first post of this thread. This quote for example:
Forum on trading, automated trading systems and testing trading strategies
Variant of the Proof of the First Axiom of Dow
Yousufkhodja Sultonov, 2017.09.09 02:30
Which states, "The market price takes into account all factors affecting it according to the law of supply and demand, and it is necessary and sufficient to have data on its change over time in order to predict it" (Rhea, Robert. Dow Theory,- New York; Barrons, 1932. and Greiner, P. and H. C. Whitcomb: Dow Theory, - New York: Investor's Intelligence, 1969. and other sources).
The authority of Dow does not let us doubt the validity of this axiom, and most market researchers use this fact and direct their efforts on studying the price behavior. But it would be useful to prove this axiom to give it more credibility and warn some people against searching too hard for other factors such as volumes, OM, news and others that influence the price and thereby, in their subconscious, question the globality of Dow's conclusion.
1. An axiom, as opposed to a theory or theorem, is an absolutely demonstrable thing. The big bang theory, is not an axiom, but a theory. An axiom is that a triangle can only have 3 angles. An axiom does not require proof, but a theory (theorem in the mathematical sense) does. Axioms are used as a basis for proving theorems, which cannot even be proved without axioms. So if we have doubts about an axiom we cannot prove any theorem. So - all geometry is rubbish...
2. It's not that you "don't accept" officially, it's just that you're leading us to accept the paucity of data and settle for one price. This follows from the first post of this thread. This quote for example:
Which states: "The market price takes into account all the factors affecting it according to the law of supply and demand, and in order to forecast it it is necessary and sufficient to have data on its change over time" (Rhea, Robert. Dow Theory,- New York; Barrons, 1932. and Greiner, P. and H. C. Whitcomb: Dow Theory, - New York: Investor's Intelligence, 1969. and other sources).
The authority of Dow does not let us doubt the validity of this axiom, and most market researchers use this fact and direct their efforts on studying the price behavior. But it would be useful to prove this axiom, to give it more confidence and warn some people from overzealous search of other factors such as volumes, OM, news and other factors influencing the price, and thereby, in their subconscious, questioning the globality of the Dow's conclusion.
We would like to present you one of the possible variants for proving this axiom, which is based on analysis of profit of commercial structures on real competitive market of goods and services, because the main goal of any commercial structure is profit and I think that Forex does not go far from the real market of goods and services.
It is known that, the most obvious, simple, radical, reliable and indisputable way of defining profit (P) is its representation in the form of the difference between income (E) and all kinds of expenses (P):
P = E - P
Expenses (P) are variable (Pper), which depends on income (E), and constant (Ppos), which does not depend on income:
P = Pper + Ppos
Therefore, the profit formula is usually represented as
P = E - Pper - Ppos
Using the definition of variable costs as Pper = K*D, we obtain, where K is the coefficient of proportionality, we write
P = (1-K)*D - Rpos
Expressing Revenue (E) as the product of volume/quantity of goods (V) by its selling price C, we obtain the following formula for determining profit in the traditional way
P = (1-K)*V*C - Ppost (1)
Any person looking at this formula (1) will exclaim: the profit depends on both the volume and the selling price of the commodity! And he would be right.
But, the articlehttps://www.mql5.com/ru/articles/1825 shows how to derive an alternative formula for profit taking into account the provisions of the law of supply and demand, which coincides exactly with the traditional formula (1):
P = A*(Ts^2 - 2*Cp*C + Tsopt^2)/C (2)
Here, A, Tsr and Tsopt are constant coefficients calculated experimentally on the basis of actual trade data within selected data sample, where A>0 for monopolistic and A<0 for competitive markets, Tsr is market price and Tsopt is optimal sales price providing maximum profit.
Based on the absolute equality of the formulas (1) and (2) we conclude that the Dow prophecy in the form of the first axiom can be a proven theorem as it contains no other variables besides the price and traders and market researchers can safely rely on the price analysis in their market research without being distracted by other market parameters.
Here is what I wanted to inform you briefly. Your opinions. Regards.
In any theory, simplifications are important. If you create a perfect horse in a vacuum)) then you can assume that
1) Each player's transaction is negligibly small to the total volume
2) News and all important information is available to all at the same time
then maybe yes)) But the devil is in the details. Let's say that all banks are forced to close positions by the end of their business day. This creates opportunities for frontrunning. But it will be possible to reliably recognise this in the price much later, when it is repeated many times. Let's assume that it was recognised and started to be used. And then the rule is abolished. We will notice it a little later by depo drawdown)) I.e. any earning theme is a prediction of what others will do and price is a lagging indicator.