Okay, my first posting…

What are the odds that tomorrow close in the same direction as today, and what will the day after do?

#days—occurences-------cumulative

2--------1055-----25%----25.10%

3--------471------45%----11.20%

4--------204------43%-----4.90%

5--------96-------47%-----2.30%

6--------48-------50%-----1.10%

7--------22-------46%-----0.50%

8--------13-------59%-----0.30%

9---------5-------38%-----0.10%

10--------3-------60%-----0.10%

11--------0--------0%-----0%

Data: ALPARI - EURUSD Daily January 12, 1993 � February 25, 2009

Explanation:

Tested what the odds are that consecutive days close in the same direction. No distinction made between higher or lowers, I may do that later on.

The third column tells us what the odds are that the next day will close in the same direction as the day(s) before. The first line tells us that there is a 25% change that the second day in row closes in the same direction as the first day. The second line tells us that there is a 45% change that the third day closes in the same directions as the second day. And so on.

So what are the odds that tomorrow closes in the same direction and the day after as well. There is an 11% change that that will happen (25% * 45%). Well, in theory that is…

The forth column tells us how often it occurs that such a sequence occurs. So in theory it happens 50 times a year that tomorrow will close in the same directions. It happens 18 times a year that three days in a row will close in the same directions. Once every 5 years there will be a sequence of 10 days.

So it depends on how you look at it. I thought this may be of interest for you to informs you of the correlation between today�s and tomorrows close, or maybe more interesting, the lack there of.

Do what you like with this information, but don�t trade on it. It is just to provide you some statistical information so that you know what your odds are and is meant purely educational.

Toekan