Successful Trading

[Magna]

Originally posted by Babak
The coin has no idea how many times it has been flipped nor does it know how many times it has come up heads or tails. It is a coin.

I agree completely.

The same can be said for the market. The market also does not care how many times it has gone down or up.

I disagree. As the sum total of all the participants the market clearly has a collective "memory", unlike a coin. Otherwise trendlines, moving averages, Elliot waves, fibonacci retracements, price support/resistance, etc. etc. would never come into play. But they obviously do, time and time again.

 

[Commisso]

Originally posted by Magna
I agree completely.I disagree. As the sum total of all the participants the market clearly has a collective "memory", unlike a coin. Otherwise trendlines, moving averages, Elliot waves, fibonacci retracements, price support/resistance, etc. etc. would never come into play. But they obviously do, time and time again.

Well see this is like applying classical Newtonian physics and Quantum physics... Sure the market has a collective memory hence support/resitance but in the micro-view what can tell you if this set-up, of the same exact nature of last, is going to play out according to the expectation of the method...

IMO the results of each and every trade on a micro level comes down to pure chance...In other words the market has a collective memory but the method itself does not... wait now i am confused... probably best to disregard the whole post

PEACE and good trading,
Commisso

 

[Babak]

Magna, the reason the market has memory is that we give it our own. Trendlines, S/R, etc. are important because we deem them to be important.

 

[AAAintheBeltway]

rs7,

Very valuable advice. I like to think in terms of having to justify positions to an imaginary partner. Tends to prevent the loss of all discipline type mistake that cna really put a hurt on your account.

 

[Commisso]

Originally posted by Babak
Magna, the reason the market has memory is that we give it our own. Trendlines, S/R, etc. are important because we deem them to be important.

But Babak aren't we all as a collective whole the market???

Commisso

 

[Magna]

Originally posted by Babak
Magna, the reason the market has memory is that we give it our own. Trendlines, S/R, etc. are important because we deem them to be important.

Babak, I agree, it's solely because we deem them to be important. But ultimately "intrinsic importance" and the reasons why don't matter, all that matters is that the collective participants have memories and deem them to be important.

 

[Magna]

Originally posted by Commisso
IMO the results of each and every trade on a micro level comes down to pure chance...In other words the market has a collective memory but the method itself does not

I agree, but like in the casino where each roll of the dice, each deal of the cards, each spin of the wheel is random.....the overall outcome can be predicted since the casino has a clearly definable edge.

 

[Commisso]

Originally posted by Magna
I agree, but like in the casino where each roll of the dice, each deal of the cards, each spin of the wheel is random.....the overall outcome can be predicted since the casino has a clearly definable edge.

Yes absolutely! Micro=chance Macro=probabilistic certainty... very much like quantum physics

PEACE and good trading,
Commisso

 

[rs7]

Originally posted by Commisso
I would treat this flip independently from all others... With a coin flip the saying "when your hot you are hot" does not apply at all... It is an illusion and can be proven mathematicaly...

Of course you are right....I agree that mathematically it can be proven to be 50/50. Pretty basic stuff. My point was simply that trends do exist. Not necessarily with any rational explanation.

Why are some poker players unbeatable? What makes a superior baseball manager defy the odds at just the right times?

Anyway, it is such a small part of what I meant to get across. You KNOW from the previous post we took to extremes that I am not a "superstitious" type. I only contend that when something happens more than it "should" (on the surface), you need to recognize that, and take advantage if possible.

Does this make any sense? Or am I losing my mind (which is a distinct possibility)

 

[Commisso]

Yes it makes sense Rs7 as I tried to explain in my post... but imo the coinflips are poor analogy because like I said there is no causality over mind/matter... In trading, poker, etc. you internally have an effect on the external reults (if you are discretionary trader ofcourse)

but i do totaly agree with the point