Gobigfx, I think you are one of the guys here who are experienced enough to understand the market.

Many traders failed to notice or understand that the market is mostly random by nature. I am not sure how many percentage of randomness the market is,

but very likely to be around 90% or so.

Of course there are some directional biases mainly due to speculations, however, in overall, the market is random.

If you flip a coin a thousand times, plot a graph, you will notice that it represents the financial markets chart.

Then what about trends?

In randomness patterns, there are trends, Google for a coin flip chart, or create a chart using an excel sheet. You will see trends.

Why are there trends?

Assuming upward movement is 1 and downward movement is 0. 101010111100111000011001100111100010

Theoretically, the zeros and ones have a 50-50 chance of occurring. Then after a few cycles of 1 and 0 alternatively, there will be a consecutive 1s or 0s.

This makes a trend.

Have a look at this example:

1010 - 1st sequence

1110 - 2nd sequence - trend started to build

1010 - 3rd sequence - trend continues - because the probability of 000 occurrence is low

0011 - 4th

1001 - 5th

0001 - 6th - back to the starting point - it takes time to revert back to the original point due to randomness and probability.

Beating the market is not easy. You have to find the edge. There are many ways to do it, but certainly not easy. An MA crossover is one of the methods that I found to be profitable.

Many traders failed to notice or understand that the market is mostly random by nature. I am not sure how many percentage of randomness the market is,

but very likely to be around 90% or so.

Of course there are some directional biases mainly due to speculations, however, in overall, the market is random.

If you flip a coin a thousand times, plot a graph, you will notice that it represents the financial markets chart.

Then what about trends?

In randomness patterns, there are trends, Google for a coin flip chart, or create a chart using an excel sheet. You will see trends.

Why are there trends?

Assuming upward movement is 1 and downward movement is 0. 101010111100111000011001100111100010

Theoretically, the zeros and ones have a 50-50 chance of occurring. Then after a few cycles of 1 and 0 alternatively, there will be a consecutive 1s or 0s.

This makes a trend.

Have a look at this example:

1010 - 1st sequence

1110 - 2nd sequence - trend started to build

1010 - 3rd sequence - trend continues - because the probability of 000 occurrence is low

0011 - 4th

1001 - 5th

0001 - 6th - back to the starting point - it takes time to revert back to the original point due to randomness and probability.

Beating the market is not easy. You have to find the edge. There are many ways to do it, but certainly not easy. An MA crossover is one of the methods that I found to be profitable.