Think of it like this: A trader who is consistent, knows his method, has a solid edge, and trades it in a disciplined fashion can generate positive results @ +/- 75% A trader who has everything above except for that outperformance edge can generate positive results @ +/- 50% A trader who has none of the things listed can generate positive results @ +/- 25% Depending on what you have to work with, you will define yourself in one of the three categories listed above.
As long as there sits a guy on the end of mouse feeling fear and greed the markets will remain non-random, as someone else stated : there is order in the apparent randomness, you just have to be willing to put in the relentless effort to see it. Indeed.
Ive been crunching numbers for a long time on FX markets... Come to the point where i think that the market is random and is not random. hard to explain but both sides are right markets are sometimes random and sometimes not.
Name one other endeavor undertaken by humans that's inherently random in it's workings and whose form doesn't adhere to any logical, intelligible or discernible behavior? Psychology? Group dynamics? Hierarchy? Communication? Non-verbal communication? History? Religion? War? Name one.
Really not random? Hmmm... Ok, let's just say I am an investor and did buy and hold? Wow, it would have been a rough decade. Let's say that you are a trader? Hmm... Until the crash you would have been hemeoraghing. Remember before the crash people said the best thing to do is buy and hold. Now they are saying you should trade. People might say that there is "order" because people are doing the trades (well not really machines are the bigger piece). Let's say that there is order, but because there are so many participants it does appear random. Though you might say there are patterns. Yes there are temporary patterns that come and go like the wind. The market is a stochastic process, which implies that for any given set of conditions there are multiple valid answers. Because if it were any other way we would have found a way to all be millionaires. With a stochastic process on the other hand sometimes you will win and sometimes you will loose. That's why it appears random. Though the only real way to make money in the market is to do the things that are contrarian. Buffet makes money because he takes on the trades that others are not willing to do. Many say that they are contrarians, but being on the opposite side of the fence is not contrarian. Being contrarian means being able to make the trades that very few are willing to make. For example, who was buying stocks in Jan, Feb, and March of this year? Not many people, because if they were the market would not have dropped. I was because I knew the market would bounce back. And indeed I made a killing this year. No technical analysis needed, no charts needed, just the stupidity of people who sell low, and buy high. I catch falling knifes and frankly I like it! AND that is why I know I will always win because people would rather be wrong in a group than right alone! Pure human nature... So yes the market has appearances of being random because of its stochastic nature.
Click:Whirrrrr Translation: "I failed. I could see what was required but I couldn't get the job done". Does it occur to you that the character trait which led you to this conclusion is the very character trait that prevented you from finding success in trading? Do you know what that trait is?