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Brian Massey wrote:
>
> Chuck,
>
> Your statements are interesting. I've read this several times (that
> markets behave more randomly than not) over the years but could never fully
> validate it. For example, I would look at a chart and see the market
> stopping at specific points (support/resistance) time after time. I mean,
> to the tick! How could you call this random behavior?
Brian, stopping at specific points may not be random but your statement is
irrelevent. Can you write a rule or describe a system that makes $$$ from, what you
are calling, the non-random behavior of support/resistance points?
> It didn't matter if
> the market was sideways or trending, real time or daily. Support and
> resistance points give me clear points to trade off of that more times than
> not resulted in winning trades.
May or may not be true. Anyway, having more winning than losing trades doesn't mean
you have a profit. On the contrary, many systems I've seen have more winners than
losers but lose money.
> Trading these points tipped the odds in my
> favor becase more often than not the balance of buyers and sellers becomes
> skewed. Buyers are less willing to buy through resistance and sellers are
> less likely to sell through support clearing the way for the other side to
> take over. This is well known and gives the trader more than a 50/50
> chance. This kind of predictability
Prove it...
>flies in the face of the idea that
> markets behave randomly. If they did then support/resistance would fail as
> much as it held and it would have no meaning in technical analysis. Yet,
> we know this is far from the case. Also, price patterns that resulted in
> follow through more than 50% of the time would not exist. Yet we (I) know
> they do.
>
> There are patterns in the market that have a high degree of predictability
> because people are creatures of habit.
People are creatures of habit. I agree. But show me a pattern (anything) that has a
"high degree of predictability". Again, prove it. Post some code.
>Habitual creatures behave in
> predictable ways and will exploit markets in the same way as long as it
> works. This, in my mind, is far from random behavior.
>
> Also, the self-fufilling nature of markets tend to reduce the element of
> randomness too.
>
> Brian.
> ....
> big snip of prev msg
> Chuck LeBeau
Regards,
Bill Vedder
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