Are trends just self fulfilling propecy?

[mute9003]

If everyone is trained to recognize same patterns then everyone react to them same.
But since its a learning curve it becomes more complex where people recognize only patterns they have learned

So the peak of tradership would be to recornize people's reactions to the learned patterns. Which is counterintuitive.

 

[maxinger]

If everyone is trained to recognize same patterns then everyone react to them same.
But since its a learning curve it becomes more complex where people recognize only patterns they have learned

So the peak of tradership would be to recornize people's reactions to the learned patterns. Which is counterintuitive.

YES AND NO.

Some people trade with the trend.

Some people do counter-trend trading.

Some people trade even when the market is trendless.

There are also traps embedded in the chart.

Look at the NVDA thread. Nvda is on the uptrend.
BUT!

 

[vanzandt]

If everyone is trained to recognize same patterns then everyone react to them same.
But since its a learning curve it becomes more complex where people recognize only patterns they have learned

So the peak of tradership would be to recornize people's reactions to the learned patterns. Which is counterintuitive.

You're on the right path at least.

"So the peak of tradership would be to recornize people's reactions to the learned patterns."

~Brilliant.

Jessie L. couldn't have said it better himself.

 

[themickey]

If everyone is trained to recognize same patterns then everyone react to them same.
But since its a learning curve it becomes more complex where people recognize only patterns they have learned

So the peak of tradership would be to recornize people's reactions to the learned patterns. Which is counterintuitive.

A slight problem with that theory.
Think of trading as a world of good guys and bad guys, both teams striving against each other.
One team for example wanting to ride a trend, the other team wanting to rug pull.
Depending on the weather which team is stronger?
Depends. Like wind, it'll blow in any sort of direction, always changing at any moment.
There are little clues though, eg Friday day traders usually bail, Monday they wanna enter.
After a long bar, short termers bail, after a short bar they may enter etc etc.

 

[vanzandt]

A slight problem with that theory.
Think of trading as a world of good guys and bad guys, both teams striving against each other.
One team for example wanting to ride a trend, the other team wanting to rug pull.
Depending on the weather which team is stronger?
Depends. Like wind, it'll blow in any sort of direction, always changing at any moment.
There are little clues though, eg Friday day traders usually bail, Monday they wanna enter.
After a long bar, short termers bail, after a short bar they may enter etc etc.

That's when you step back, and take it all in.

 

[Pricechange]

If everyone is trained to recognize same patterns then everyone react to them same.
But since its a learning curve it becomes more complex where people recognize only patterns they have learned

So the peak of tradership would be to recognize people's reactions to the learned patterns. Which is counterintuitive.

The entire notion of AI is to more quickly and efficiently analyze the established learning curve. Trading AI would deeply ingrain established pattern recognition and resulting feedback loops...thus funneling the bulk of all trades into a very small group of heavily weighted investments (the ultimate bubble) and repeat this as the learning curve became ingrained. A kind of optimized brain washed analytical system.

 

[wxytrader]

If everyone is trained to recognize same patterns then everyone react to them same.
But since its a learning curve it becomes more complex where people recognize only patterns they have learned

So the peak of tradership would be to recornize people's reactions to the learned patterns. Which is counterintuitive.

The market is determined...it does no move freely or randomly, and is not reactive to external factors.

 

[Handle123]

A slight problem with that theory.
Think of trading as a world of good guys and bad guys, both teams striving against each other.
One team for example wanting to ride a trend, the other team wanting to rug pull.
Depending on the weather which team is stronger?
Depends. Like wind, it'll blow in any sort of direction, always changing at any moment.
There are little clues though, eg Friday day traders usually bail, Monday they wanna enter.
After a long bar, short termers bail, after a short bar they may enter etc etc.

I think of myself as the bad guy, I like being the bad guy, I have studied what happens when retail trades, they on average lose but they offer light volume. Volume dictates direction, which means it often starts as countertrend patterns, patterns that are never written in books or talked about. When retail stops are forced to be hit, more volume comes in. It is a game played hundreds of times in 24 hour day.

 

[mute9003]

so "hypothetically speaking" if say bunch of hedgefunds would promote literature about "how to trade in stock market" regardless of how the trends originated in the distant past.
wouldnt those "market makers" and other big institutions benefit from lets say the hurd of retail traders who read same books and respond to same stimuli on the chart like an ascending triangle for example.
so all the institutions have to do is to load up the shares, then create the pattern where people would roll in and play out the pattern as close as they can to what they saw in the book while the institution unloads the shares into those buyers.

which would mean that the trading legends of the past are basically the people who found an inconsistency in the market and exploited that until it became widely known and absorbed by general market and did not work anymore.

 

[themickey]

Volume dictates direction, which means it often starts as countertrend patterns, patterns that are never written in books or talked about. When retail stops are forced to be hit, more volume comes in. It is a game played hundreds of times in 24 hour day.

Any chance you can draw a picture?
I don't grasp how volume starts as a countertrend pattern.
Who is creating that (whatever it is) - the dumb money or institutions?