Jump to content
Sign in to follow this  

What's wrong with predictions?

Recommended Posts

So you've got a strong feeling you know where the market is going to go, commentators have called it, signal services have signaled it, paid for pickers have picked it and you have been shouting it from the roof tops.

It's a cert, what could possibly go wrong?

Well everything actually.

There's lots of talk about 'the smart money' banks, institutions, pension funds and the like but not much about the others side of the coin, 'the dumb money', why is that - it's because they just aren't influential to the market. The collective size of the dumb money is dwarfed by the big money to the point of being irrelevant.

The smart money employ their own analysts and indicators and keep them closely guarded, everything you find on the internet is directed at one group only and it's not the smart money. So no matter how correlated and confluenced everything you find on the internet may be the dumb money as a group are still unable to move the market.

So all the power lies with the smart money and they are only interested in battles amongst themselves and are certainly not listening to your commentators or signalers or your pickers or to you.

So why bother with any of it? Because you are needing guidance, why? Because you can't actually predict what the smart money is going to do.

The solution is obvious, don't even try to predict. Watch the smart money battle it out over a significant level, when the battle is over the loser will retreat back to the next significant level while the winner marches on to the same. Your job is to follow in their footsteps. Predictions have nothing to do with it.

Occasionally spontaneous battles will break out on new news, fine, the rules are the same, don't guess, wait and be ready to move once the winner becomes obvious.

On all dumb money forums (all forums) you will always find some making their predictions, listen at your own risk, when they are wrong 50% of the time you can be sure of excuses and disclaimers.


 


 

  • Like 1
  • Great! 1

Share this post


Link to post

Which is why that COT data you talk about a few times is so important. Really think there should be more talk about it and for traders to properly understand what is going on / whats shifting at the institutional level.

Great article and food for thought.

Share this post


Link to post

you are right @cryptotrader, the COT data is an excellent free weekly resource and very easy to interpret. Take a look every Sunday or Monday and see how the large speculators, who are the registered traders for institutions, banks, pension funds etc, have shifted their positions on a week by week basis. It usually takes them a lot longer than a week to complete the big moves so there is time to get in and follow or at least reconsider standing in their way.

For example looking at the audusd chart below, large speculators went net short in April and rode the market down adding to their shorts all the way into November when they started unwinding their positions though still remain net short as of the last report.

Aside note, unfortunately there has been no COT data due to the US gov partial shutdown since the end of December.

https://cotbase.com/ 

image.thumb.png.5a2cfeb88aa5de7f3f8834a07c515248.png

Share this post


Link to post
On 16/01/2019 at 15:36, Caseynotes said:

you are right @cryptotrader, the COT data is an excellent free weekly resource and very easy to interpret. Take a look every Sunday or Monday and see how the large speculators, who are the registered traders for institutions, banks, pension funds etc, have shifted their positions on a week by week basis. It usually takes them a lot longer than a week to complete the big moves so there is time to get in and follow or at least reconsider standing in their way.

For example looking at the audusd chart below, large speculators went net short in April and rode the market down adding to their shorts all the way into November when they started unwinding their positions though still remain net short as of the last report.

Aside note, unfortunately there has been no COT data due to the US gov partial shutdown since the end of December.

https://cotbase.com/ 

image.thumb.png.5a2cfeb88aa5de7f3f8834a07c515248.png

This is really great info, thanks for that!

Share this post


Link to post

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
Sign in to follow this  

  • Member Statistics

    • Total Topics
      13,137
    • Total Posts
      66,709
    • Total Members
      89,357
    Newest Member
    Firas
    Joined 29/11/20 02:08
  • Posts

    • The Covid Hoax continues. Everything centers on the PCR test and it's deliberate misuse. A PCR of 25 cycles identifies the infectious with a minimal amount of false positives, the more cycles you do the more false positives are included. Fauci himself has said 35 cycles and above most results are false positives for infectious material. Western countries are running the PCR test at 45 cycles which is mathematically known to give 90%+ false positives. Govt and health officials know this. Groups in Portugal have joined groups in Italy and the UK in starting legal action against the fraudulent misuse of the PCR test used to justify continuing lockdowns and social restrictions. Meanwhile new research from the US finds: “All of this points to no evidence that COVID-19 created any excess deaths. Total death numbers are not above normal death numbers. We found no evidence to the contrary,”  Just as has already been found in many other countries (see recent posts above for data from Sweden and Ireland).  https://web.archive.org/web/20201126223119/https://www.jhunewsletter.com/article/2020/11/a-closer-look-at-u-s-deaths-due-to-covid-19  
    • Doh! Maybe I should have thought it through a bit more aha. Not been having much luck instraday atm, so was going to try and take advantage of moves that last multible days, and so was wondering about overnight charges. But like you said, it's proably cheaper than the spread anyway. Cheers
    • SAT MORN 3AM NZ TIME MARGINS PUSHED WAY TOO HIGH CAUSING MARHIN CALL.. WHAT HAPPENED? 
×
×