If markets were random why then does volatiliy spike at certains of the day (illustration inside)

[Heydrrich]

Then that is something that is NOT random.

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source:
http://oanda.autochartist.com/aclit...F081DFC64CB91C8C22#PowerStatsPlace:powerstats

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[murray t turtle]

Then that is something that is NOT random.

View attachment 235348

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source:
http://oanda.autochartist.com/aclit...F081DFC64CB91C8C22#PowerStatsPlace:powerstats

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Exactly. But something looks like your data is right but off on the timing;
12 noon being the middle of your chart= fine But . !st + last hours tend to move largest/not random price/not random volume.

 

[wrbtrader]

Then that is something that is NOT random.

View attachment 235348

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source:
http://oanda.autochartist.com/aclit...F081DFC64CB91C8C22#PowerStatsPlace:powerstats

)

I think when someone states that markets are random...

That person is not stating that markets are random every second of the trading day. Thus, there's plenty of price action that's not random.

wrbtrader

 

[easymon1]

ut off on the timing;

agree, something looks funky there, why is 9:30 hour not one of the largest ranges? What time zone is that bad boy quoted in?

 

[tiddlywinks]

"why then does volatiliy spike at certains of the day"

ETH (extended (and overnight) trading hours) and RTH (regular trading hours) are significantly different in terms of number of participants and volume. A 5yo can see the volume difference on most any instrument that's active 24/5.

As for random... Mark Fisher has already shown that random walk does not exist.

 

[Heydrrich]

agree, something looks funky there, why is 9:30 hour not one of the largest ranges? What time zone is that bad boy quoted in?

Yes this is the timezone

 

[Laissez Faire]

Markets are not random.

But just because they're not random does not mean they're (easily) predictable either.

In order to make valid predictions you need to assemble and gather the relevant data. This is your starting point.

 

[Real Money]

Markets are not random (I've taken classes on advanced probability).

It would be more accurate to say some things are more or less difficult to predict. And some instrument combinations exhibit more or less empirical variance to modeled distributions.

This leads many participants to limit their participation. Risk controls also weigh into those decisions.

For example, many large trading firms will not take outright index exposure, instead trading the spot/forward or index spread due to the risks being substantially reduced. In the treasury market, the same thing happens where the biggest players are trading the deliverable/forward, roll/forward, and duration spreads.

Quants will talk about 'return distributions' and make useful assumptions about them. These assumptions are required for risk models and this in some ways contributes to the statements about markets being random. Also, the benefit of diversification assumes things about return distributions that could be construed as saying that markets are random.

 

[themickey]

Markets are not random (I've taken classes on advanced probability)......

Is the large movements of swarming insects, birds, animals, fish random?
The answer is yes and no.
The swarming is a natural effect, they follow a pattern, it happens regularly.
But it has a random component where the next move could go in any direction.

 

[VEGASDESERT]

vol spiking at certain time may not be random but it doesn't
mean its tradeable in an of itself.

day tops and bottoms get put in the first 90 minutes of the day about 85% of the
time (not random) but it doesn't mean I can profit from that knowledge alone.

its price that random heads talk about not certain market structural dynamics.