I’ve gone over the babypips school, but I’m questioning how reliable technical analysis markers are.
For example, Fibonacci numbers …so the markets apparently move in accordance with in a certain sequence that resonates with the universe??? I read that they’re self-fulfilling - they work because everyone is looking at them. But if the market can work this way, what stops a group of people from just getting together and inflating demand by buying a currency, and then selling it off at higher prices?
And stochastic, boilinger bands, and moving averages don’t really “predict” movement on their own do they? I’d say they signal when the market starts to move in a different direction - as distinguished from just normal fluctuation. Is this correct?
I think when you say “markers”, you’re probably asking about what most of us call “indicators”?
Personally I have, overall, a pretty low opinion of them, and trade without them. But [U]all[/U] my trading is technical analysis based. It’s essential to appreciate that TA and indicators are two different things.
People believe all sorts of things, don’t they?
Countless millions believe in astrology.
Some people trade according to phases of the moon.
It would take a huge number of people with huge accounts. It takes an enormous amount of buying/selling pressure to move prices significantly.
No; certainly not.
Yes - quite correct (though that can be a worthwhile thing for some people to have displayed, according to how they trade).
[B]As a probability function[/B], yes: never with anything approaching certainty in any individual case.
Every time I put on a trade, I don’t know what its outcome will be. But I know to within a percentage point or two or three what the [U]collective[/U] outcomes of my next 500 trades will be. And that’s what I need to know, to make a living. (That and a whole lot of other things, too, anyway - such as using appropriate position-sizing for the “collective degree of certainty” I have.)
“Predict” is a difficult word, in forum conversations.
The reality is that its usage often covers up the hugely significant distinction between “[U]individual[/U] and [U]collective[/U] predictability”.
