Predicting randomness
- Thread starter oddiduro
- Start date
You can interpret it as you want, that's more philosophy than real maths. Usually axioms are set AFTER having developed or experienced a theory, whatever in maths or physics. They correspond to a comon observation of certain facts. But you can take whatever axiom you want and develop a theory on it. Perhaps one day your theory could be useful.
As an example, take euclidian geometry. Its axioms concerning parallels are not the same as the axioms of Minkovsky's geometry, but both geometries are very useful, even if Minkovsky's geometry is not something we experience everyday.
i think its got nothing to do with predicting, but just applying a few simple theorys to your trading. time is money -> the more the time -> the more the money. if your avg holding time for your winners is longer than your avg holding time for your losses there is opportunity. price can only go so far in 5 minutes/days so keep your losses in this timeframe, price can go a lot further in 30 minutes/days so keep your winners in this timeframe.
when i make an entry its not because ive predicted it to go up, its because if it 'does' go up, there is a better than random chance it wont go down 'xyz' amount and i have to get out before it trends upwards.
a trader just has to find his 'grub' points for these windows of opportunity to open.
when i make an entry its not because ive predicted it to go up, its because if it 'does' go up, there is a better than random chance it wont go down 'xyz' amount and i have to get out before it trends upwards.
a trader just has to find his 'grub' points for these windows of opportunity to open.
oddi, I think it is you who is fooled by Randomness
Here is why...Let's say that 90% of the time in any time frame there is random movement. Whatever system you trade in that time, you will get random results. Even if you don't have a system, you may get the same results. So you may conclude that the market is moving randomly. Moreover, if you don't apply strict money management in this 90% of the time, you will most likely lose your nerve and give up on your system.
How about the other 10% of the time... This is the time when almost everyone gets trapped on the same side of the market because they are exposed to the same outside influences and their instincts take over and dictate them do the same thing... That thing happens to be a mistake. And that is your opportunity (you don't know that at the time !!!) to make up for all your previous random results, when everyone was cautious, under control, thinking critically and successfully hiding their intentions thus generating only false signals and noise. If in these rare situations, you manage to follow your system of trading rules, which are based on the analysis of such situations in the past and are designed to capture what is most likely to develop, then your big gain will come and you will come up slightly ahead of the others. This is all you need to get to consistent profitability, no matter that the market is an unpredictable beast
From a behavioral point of view, you are simply trying to anticipate human actions, which when they are playing the game of money, will be very difficult to decipher, but not impossible when they lose their nerve
From a statistical point of view, you will just observe some technical setups, which when played in a certain way, may generate enough gains to compensate for all the losses when they don't turn out well.
And you are right about one thing - you may blow out tomorrow on some bad sequence of trades, but the probability of that is pretty slim or even impossible to calculate because there are endless bad scenarios and only a handful of positive ones but you just have to take the risk and do the best you can... and that is to try to stay on top of your game and beat the next guy
OH SO TRUE!!!!!!!!!!!!!!!!!!!!!
It is so laughable to me how little the RANDOM WALKERS understand about developing or setting up an accurate study of market information.
Sometime, when I get the time, I will write a book (with my market formula(s) that will dispel the myths.
In the mean time I'll just keep taking their MONEY!!!!!!!!!!!
Never do that. You would ruin my nestegg.
Quote from oddiduro:
My trading is just as random as yours
But how do I, or you, really know? Maybe it just works right now. Maybe I will blow up today, especially if I bet the farm on that test of support on lower volume that I know is coming today...or is it higher volume
that's why you never bet the farm
Quote from neutrino:
oddi, I think it is you who is fooled by Randomness
Let's say that 90% of the time in any time frame there is random movement. Whatever system you trade in that time, you will get random results. Even if you don't have a system, you may get the same results. So you may conclude that the market is moving randomly. Moreover, if you don't apply strict money management in this 90% of the time, you will most likely lose your nerve and give up on your system.
How about the other 10% of the time... This is the time when almost everyone gets trapped on the same side of the market because they are exposed to the same outside influences and their instincts take over and dictate them do the same thing... That thing happens to be a mistake. And that is your opportunity (you don't know that at the time !!!) to make up for all your previous random results, when everyone was cautious, under control, thinking critically and successfully hiding their intentions thus generating only false signals and noise. If in these rare situations, you manage to follow your system of trading rules, which are based on the analysis of such situations in the past and are designed to capture what is most likely to develop, then your big gain will come and you will come up slightly ahead of the others. This is all you need to get to consistent profitability, no matter that the market is an unpredictable beast
From a behavioral point of view, you are simply trying to anticipate human actions, which when they are playing the game of money, will be very difficult to decipher, but not impossible when they lose their nerve
From a statistical point of view, you will just observe some technical setups, which when played in a certain way, may generate enough gains to compensate for all the losses when they don't turn out well.
And you are right about one thing - you may blow out tomorrow on some bad sequence of trades, but the probability of that is pretty slim or even impossible to calculate because there are endless bad scenarios and only a handful of positive ones but you just have to take the risk and do the best you can... and that is to try to stay on top of your game and beat the next guy
Have you not just describe randomness under a different milieu?