Thursday, March 17, 2011

can stockmarket movements be predicted?

when i read statements like

"trading is the one area of life
where there's no guarantee
that hard work will ever pay off"

or when i come across a brilliant observation
from someone as brilliant as jesse livermore
like
"the family of trading mistakes is infinitely large"

i am forced to ask myself again and agsin

are stock market movements
based on some logic
or are these illogical?

if these are based on some clear cut logic
then these can definitely be tamed with a method.
if these movements are beyond logic
then there is little hope
not only for retail traders
but also for sophisticated expensive trading software!

also,
are stock market movements
predictable
or are these unpredictable?

if these are predictable
then these can be anticipated!
otherwise
all this is only witch-hunting!

so, what is the reality?

--

it is my experience
and my understanding
that
the reality is somewhere
in the middle!

not just that
the reality is kept
constantly swinging
like a pendulum
between the two edges
to suit the games being played!

--

till the operators intervene
the market price movements
are both logical and predictable,

but a little nasty helping "nudge"
of these tactful operators
is enough

to prick all balloons
of logic and expectations!

--

so, what can and should
a trader do about this?

simple,

do the logical
skip the illogical

and learn to know the difference!

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