What IF?. One could bet on $TICK instead of price. One could create a synthetic instrument that moves like $TICK, but is tradable unlike $TICK. ...
This is a good example. Are we talking here Bayes prior statistics? Actually, it is not an esay bet. It is a high probability bet. Maybe playing with words here but it makes a difference. You have an unfair coin, heads is 0.05%. You see heads after a toss. Is it an easy bet? Actually, you can see heads a few more times and that can ruin you for good.
Actually it isn't exactly the same thing as the coin flips are not normally distributed. For the coke bottles you bet on the next bottle's content relative to the previous one. You can compute the exact expectancy relative to the content of the previous bottle and then develop your money management strategy on top of it. Beside if you're allowed to play strangles on the bottle contents you can have a very reliable betting strategy. Ninna
Still looking for that edge rather than learning how to read price huh And you think the RSI will help you with this Good luck with that.
If you would bother to read through the topic, you'd know he already has revealed some edges. There is more than one way to trade.
Why not do some research on RSI Reversals per Cardwell. RSI Positive Reversals and RSI Negative Reversals. Brown has the projection of the target for these in her book, so you have an actual point of reference for the signal and a target. Forget the whole overbought oversold thing and just try a study on the signals themselves. You also have Cardwell here to participate.
She has a reason...She is trying to make us all wealthy... Actually, is that a he or she? Isn't Ninna a Japanese name? I'm at a loss here?
Well, maybe they don't deserve it. I don't believe that concepts in themselves contain secrets, thus I allow myself to talk about them. However you'll never see me talk about implementing the concepts. Ninna
There are a few ways to accomplish this; go back and search some of Maestro's old threads. Secondly, there are some good ideas posited by nLepwa, but regarding reversion of fat tails.. be very careful about some assumptions. It can be shown that fat tails actually increase short term auto correlation, rather than revert as expected. Very important to remove the IID assumptions and look at the empirical data for what it is.