General Topics
Technical Topics
Brokerage Firms
Community Lounge
Site Support

We could give an analogy of trading which is the coin toss.
When heads falls 10 times a in a row, it means the chance of tails falling has increased. Even when the probability has stayed the same 50%.
Traders should understand the consequences of probability in statistics.

I personally believe that it is better to understand the coin and how it is made, which have an affect on the result.

3. ### Gabfly1

Evidently, you are not one of those traders who understands "the consequences of probability in statistics."

As an aside, coin tosses are entirely independent of one another, assuming a fair coin and a fair toss. Price action, not so much. Also, there is really no such thing as a probability distribution for future price action, as there is for a coin toss. You are confusing uncertainty that may have a balance of probability, with an actual probability distribution.

If coin tosses are truly independent, there would be no 50% probability.

The longest streak of roulette is 55. If you have a set of 55, 56 is pure 100% win.

5. ### Gabfly1

You don't know what you are talking about. Have a nice day.

6. ### Smart Money

Please do not feed the trolls

P(56 heads) is not equal to P(the 56th coin toss result in head)

P(the 56th coin toss result in head) = 0.5

8. ### Trvlwanderer

Ummmm. This is completely false.

There is no argument.

Each toss is independent. The probability is based on number of possible outcomes, not a fixed data set.

Close thread to spare the inevitable flame war