Too Much Information?
- Thread starter Mike805
- Start date
When has a mirror ever exaggerated anything ? A mirror is a perfect reflection is it not ? Secondly, in my opinion the world economy is primarily motivated by international trade, consumers and debt, as opposed to "misinformed market participants".
With regards to your system based upon reaction, it would appear on the surface that you have defined a potentially viable trading strategy and the only remaining variable that requires your focus is the timing of your entry and exit.
Some people, when they look in the mirror, do not see themselves as they actually appear in reality. Depending on one's mood and self-confidence a mirror will reflect what that person wants to see rather than what is actually the case.
Such is also the case with global markets. Investment is a belief about the future. While some may have an optimistic view of the future based on the factors you describe, very few actually have an accurate, reality based assessment. It is human nature to embellish and overlook certain details when formulating a concept about future market prices, hence one's confidence is usually the determining factor.
Where did I mention any specific system? You and Redneck seem to be on a kick about some system... I did not start this thread to share trading methods/system ideas.
The point is we are experiencing a fundamental change in the way markets are reacting to the recent onslaught of information.
Some people, when they look in the mirror, do not see themselves as they actually appear in reality. Depending on one's mood and self-confidence a mirror will reflect what that person wants to see rather than what is actually the case.
response = By your responses to my posts â quite obvious in your case
Such is also the case with global markets. Investment is a belief about the future. While some may have an optimistic view of the future based on the factors you describe, very few actually have an accurate, reality based assessment. It is human nature to embellish and overlook certain details when formulating a concept about future market prices, hence one's confidence is usually the determining factor.
response = Again by your responses to my posts â quite obvious in your case (you seem to like to assume quite a bit)
Where did I mention any specific system? You and Redneck seem to be on a kick about some system... I did not start this thread to share trading methods/system ideas.
response = I would ask any other member (other than you that is) to point out where I mentioned a âsystemâ of any kind in this thread
The point is we are experiencing a fundamental change in the way markets are reacting to the recent onslaught of information.
response = And this matter how..../ why would/ should it affect how a trader - trades⦠which btw WAS the point of my original post to you
My commentary
Reality must be a real pain for you
Good luck â Iâm out of this one
Redneck
eta
I'll do you one better - we've stated .... "Everything you need to know is right there in front of you " .... to trade successfully
I would ask any other trader to post and show how/ where - we're wrong with this statement
Maybe this will help with reality
response = By your responses to my posts â quite obvious in your case
Such is also the case with global markets. Investment is a belief about the future. While some may have an optimistic view of the future based on the factors you describe, very few actually have an accurate, reality based assessment. It is human nature to embellish and overlook certain details when formulating a concept about future market prices, hence one's confidence is usually the determining factor.
response = Again by your responses to my posts â quite obvious in your case (you seem to like to assume quite a bit)
Where did I mention any specific system? You and Redneck seem to be on a kick about some system... I did not start this thread to share trading methods/system ideas.
response = I would ask any other member (other than you that is) to point out where I mentioned a âsystemâ of any kind in this thread
The point is we are experiencing a fundamental change in the way markets are reacting to the recent onslaught of information.
response = And this matter how..../ why would/ should it affect how a trader - trades⦠which btw WAS the point of my original post to you
My commentary
Reality must be a real pain for you
Good luck â Iâm out of this one
Redneck
eta
I'll do you one better - we've stated .... "Everything you need to know is right there in front of you " .... to trade successfully
I would ask any other trader to post and show how/ where - we're wrong with this statement
Maybe this will help with reality
Translate this statement into a trading situation... How is a trader going to form any level of confidence or sustained profit taking from the market if they believe that the information they are observing is distorted and not based in "reality"? If the said person see's what they want to see, then they are either some kind of miracle worker who can mentally create a price chart that conforms to their personal desire at will, or they are completely out of touch with the fundamental state that the majority of successful traders exist within, which is ofcourse objectivity.
What do you believe is going to happen this week on the indices? What do you believe will occur next week, and the week after that? How do you reduce your "belief" into a working system that you can trade day in day out to generate a consistent profit? If all you have is belief, then you have no idea, no structure, no plan, and basically absolutely nothing, unless ofcourse you have the midas touch.
Where is your evidence that the majority of market participants are using this "onslaught of information" you describe to form trading decisions?
More importantly, can you describe this fundamental change in the way modern markets are reacting relative to a historical chart? Provide us with some concrete evidence to support your claim in the form of two charts, one from when the markets reacted the way you think they did, and another from the point when the market began to display these fundamental differences that you speak of. If you are unable to do so then I'm afraid I don't have any further input that could be considered relative to whatever your thread is attempting to delineate.
Mike, You just made a series of well written, well thought out posts. Kudos. I like this line in particular:
"The fact that more people are acting on the same misinformation than ever before will, in my opinion, create more efficient *and* at the same time, more irrational markets. This is neither good nor bad from my perspective, but, it does raise the question of the marketâs fundamental purpose â price discovery."
I don't know if there's more good information or more worse information but clearly info is disseminated quicker than ever and it's effect on prices is with the immediacy of a mouse click. I'm not quite sure if that phenomena ultimately changes the price discovery model. Certainly there's less "dumb money" to pick off after reports but IMO the revaluation process is the same whether it's traders responding to news on-line or by smoke signals. It matters little if it's one seller or a million sellers who offer a market down to fair value after new information becomes available. Keep in mind some of the biggest recent moves we've seen weren't on immediate "news" events as much as traders shifting on perceived macro analysis. In relative dark ages periods like Oct/07, Oct/29 and Oct/87 the market made moves even bigger than now with information much more exclusively held.
"The fact that more people are acting on the same misinformation than ever before will, in my opinion, create more efficient *and* at the same time, more irrational markets. This is neither good nor bad from my perspective, but, it does raise the question of the marketâs fundamental purpose â price discovery."
I don't know if there's more good information or more worse information but clearly info is disseminated quicker than ever and it's effect on prices is with the immediacy of a mouse click. I'm not quite sure if that phenomena ultimately changes the price discovery model. Certainly there's less "dumb money" to pick off after reports but IMO the revaluation process is the same whether it's traders responding to news on-line or by smoke signals. It matters little if it's one seller or a million sellers who offer a market down to fair value after new information becomes available. Keep in mind some of the biggest recent moves we've seen weren't on immediate "news" events as much as traders shifting on perceived macro analysis. In relative dark ages periods like Oct/07, Oct/29 and Oct/87 the market made moves even bigger than now with information much more exclusively held.
Hey, around ET all one needs to do is not sound like a blubbering idiot and I say kudos. For "incredible and groundbreaking analysis" I'm forced to stand in front of a mirror.....
