Have Markets Really Changed ?

Fundlord

Fundlord

Quotes from Jesse Livermore:

"There is nothing new on Wall Street or in stock speculation. What has happened in the past will happen again, and again, and again. This is because human nature does not change, and it is human emotion, solidly build into human nature, that always gets in the way of human intelligence. Of this I am sure.

"All through time, people have basically acted the same way in the market as a result of greed, fear, ignorance, and hope. This is why the numerical formations and patterns recur on a constant basis."

"I absolutely believe that price movement patterns are being repeated. They are recurring patterns that appear over and over, with slight variations. This is because markets are driven by humans — and human nature never changes."


Which begs the question should we all be studying past price data from earlier months/years/decades to make us better traders ?

Maybe it can improve our gut decisions/intuition by having a sense of what has gone on in the past we can have a feel for what will happen.

Disclaimer: I am not a fully technical trader/pattern trader, I base a large number of my trades on how markets react to new fundamental data and correlations between various markets.
 
I've never been able to relate to people who claim that the markets have changed. I've analyzed price charts from at least a century ago and those charts still follow the same drivers of price action. You can view charts that have nothing to do with trading and see the same action occurring.
 
Money Trust said:
I've never been able to relate to people who claim that the markets have changed. I've analyzed price charts from at least a century ago and those charts still follow the same drivers of price action. You can view charts that have nothing to do with trading and see the same action occurring.
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Would you consider yourself a price action/pattern trader ?

Do you think looking at a centuries worth of data has had a meaningful benefit to you as a trader ?
 
whatever has gone up will keep going up. Or at least, that is what I bet on. Most of the time it makes you feel like you are losing your mind. But sometimes it makes you a lot of money.
 
Fundlord said:
Would you consider yourself a price action/pattern trader ?

Do you think looking at a centuries worth of data has had a meaningful benefit to you as a trader ?
More...
Yeah, I trade strictly by price.

I don't know if looking at centuries of data helped me in the sense of improving my strategy but it did help to validate my strategy.
 
Have Markets Really Changed ?


Buying and selling make up the mkt..., and have remain a constant since the advent of a / the mkt

What has change is the speed - with which buying / selling occur..., with which information is transferred / broadcasted / disseminated

Get a handle on the the speed - the rest is..., as its always been

RN
 
I think the markets continually changes and goes through periods with varying levels of volatility, trendiness/choppiness.

Certainly a lot has changed since Livermore traded, namely the SEC.

I think there are several studies that currencies no longer trend like they did pre-2000, when many of the great trend followers made their hay. That's not to say that they won't eventually trend again.
 
Volatility changed, the number of listed companies changed, technology changed and almost closed the gap of information between institutional and retail traders/investors. As for price patterns, trends, human psychology, emotions.....that remains the same with a few modifications and adjustments here and there.
 
Jesse lived and traded through the 1907 panic, WWI bull market, a long sideways stretch, the most famous bull market ever and the great depression. Looking into the depths of hell brings about an awareness. Born in a cross fire, Baptized by fire, etc etc.. He lost a million when a million was wow. None of us come close to that kind of learning model.

Did Jesse study past prices? Naw. He just got to know the psychology of the pack and either front ran it or took the contrarian side. He started trading at 14. In 1900 he was 23. In 1907 (almost 20 years of exp) he saw the panic and took the other side of the trade instinctively. In the 1920s WWI was over and every was happy. They were buying the hell out of the market and he rode it too. By 1929 he had already made through the 1907 panic and knew a top when he saw one. He obviously knew psychology and emotions and he saw greed and fear correctly as contrarian opportunities...but mostly he had years of exp starting from the street level. Study prices...not so much

I am not even sure they printed that many stock graphs in the 1900. He pro did study volume, momentum, gaps, percentages of price change over time..butb patterns may not have been readily avail to him
 
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Pricechange said:
Jesse lived and traded through the 1907 panic, WWI bull market, a long sideways stretch, the most famous bull market ever and the great depression. Looking into the depths of hell brings about an awareness. Born in a cross fire, Baptized by fire, etc etc.. He lost a million when a million was wow. None of us come close to that kind of learning model.

Did Jesse study past prices? Naw. He just got to know the psychology of the pack and either front ran it or took the contrarian side. He started trading at 14. In 1900 he was 23. In 1907 (almost 20 years of exp) he saw the panic and took the other side of the trade instinctively. In the 1920s WWI was over and every was happy. They were buying the hell out of the market and he rode it too. By 1929 he had already made through the 1907 panic and knew a top when he saw one. He obviously knew psychology and emotions and he saw greed and fear correctly as contrarian opportunities...but mostly he had years of exp starting from the street level. Study prices...not so much

I am not even sure they printed that many stock graphs in the 1900. He pro did study volume, momentum, gaps, percentages of price change over time..butb patterns may not have been readily avail to him
More...
what ever happened to good old Jesse?
 
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