Statistics for Traders
Statistics is one of the most misunderstood and abused subject in mathematics (and science). The reason is something we can all easily understand – statistics is something we can all sort of relating to but counter-intuitive when applied in event by event situations.
Our brains are wired that way so that our ancestors can survive in nature. Since human has not evolved into any better forms for quite some time, yet our civilization is advancing in such a pace that even our computers are outdated every year or two, our minds are not that cooperative when it comes to making decisions that are drastically different from the ones that our ancestors faced. The ability to adapt our minds in making proper trading decisions boils down to our ability in applying logical thinking and statistical analysis properly.
It all sounds so complicated but in reality all you have to do is to take time understanding some basic concepts in statistics, then utilize the distilled rules and concepts to make better trading decisions, as oppose to relying on our gut feelings.
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The Black Swan
The Black Swan: The Impact of the Highly Improbable written by Nassim Nicholas Taleb is an interesting book. One of the claims in the book talks about the return of the Dow Jones Industrial Average will be cut by half if a limited number of days (the ...
The Black Swan: The Impact of the Highly Improbable written by Nassim Nicholas Taleb is an interesting book. One of the claims in the book talks about the return of the Dow Jones Industrial Average will be cut by half if a limited number of days (the ...
The Extremely Uneven Distribution Behaviour In Emini S&P 500 Regular Trading Session
Following is a chart showing the net gains from long only models that trade only on a particular weekday. The results are very interesting. Notice the drastic difference in net gain for each weekday. I can guess that you have many questions in you ...
Following is a chart showing the net gains from long only models that trade only on a particular weekday. The results are very interesting. Notice the drastic difference in net gain for each weekday. I can guess that you have many questions in you ...
The One Bearish Setup Everyone Must Know Daytrading Emini S&P 
This trading setup is kind of complement pattern of the one presented in The One Bullish Setup Everyone Must Know Daytrading Emini S&P. It is short only, strictly day trade from open to close. It has been profitable all these years. Yet no one ev ...
This trading setup is kind of complement pattern of the one presented in The One Bullish Setup Everyone Must Know Daytrading Emini S&P. It is short only, strictly day trade from open to close. It has been profitable all these years. Yet no one ev ...
The One Bullish Setup Everyone Must Know Daytrading Emini S&P
If I am going to tell you that there is one simple day trading setup that works all these years you will probably think that I am kidding. What if I tell you that this setup is long only, strictly day trade from open to close? I must be joking, right ...
If I am going to tell you that there is one simple day trading setup that works all these years you will probably think that I am kidding. What if I tell you that this setup is long only, strictly day trade from open to close? I must be joking, right ...
The TRIN Bearish Bias Play
TRIN bearish bias is different from its bullish bias for the same reason that bull market behaviour is different from bear market. Short term overbought condition in TRIN has more requirements than its counterpart. First, net gain from day trading t ...
TRIN bearish bias is different from its bullish bias for the same reason that bull market behaviour is different from bear market. Short term overbought condition in TRIN has more requirements than its counterpart. First, net gain from day trading t ...
The TRIN Bullish Bias Play
TRIN is also called the Arms Index. It is often used as a swing term indicator. It can be used that way but it is a waste of the information provided by the index. First, net gain from day trading this TRIN bias. The Setup [DTBMember] ...
TRIN is also called the Arms Index. It is often used as a swing term indicator. It can be used that way but it is a waste of the information provided by the index. First, net gain from day trading this TRIN bias. The Setup [DTBMember] ...
The VIX Bearish Bias Play
The bearish property of VIX that no one talks about. If you need background information about the Volatility Index (VIX) please read The VIX Bullish Play. It has more background information about VIX that I do not want to repeat here. I am going to ...
The bearish property of VIX that no one talks about. If you need background information about the Volatility Index (VIX) please read The VIX Bullish Play. It has more background information about VIX that I do not want to repeat here. I am going to ...
Trading with Tick Index: Tick1K and its Divergence Signals
Someone asked what I mean by “custom tick divergence” in my real-time commentaries. Here are 5 charts (one day each) for the past week with Emini S&P, $Tick index and my DNO_Tick1K index. (You can expand them to full size for better viewing.) ...
Someone asked what I mean by “custom tick divergence” in my real-time commentaries. Here are 5 charts (one day each) for the past week with Emini S&P, $Tick index and my DNO_Tick1K index. (You can expand them to full size for better viewing.) ...
Understanding the Market in a Statistical Way
Have you ever spent time studying how the market you trade behave statistically? Here is an example showing some interesting behaviour that is ignored by many traders. Statistic Concept of Runs A Run in statistics means the repetition of th ...
Have you ever spent time studying how the market you trade behave statistically? Here is an example showing some interesting behaviour that is ignored by many traders. Statistic Concept of Runs A Run in statistics means the repetition of th ...
Weekly STOPD Pattern: S&P Bearish Continuation 1
There are quite a number of patterns that work around the weekly STOPD price levels giving us a solid edge. This one is a classic bearish continuation setup. Net gain chart below. The Setup [DTBMember] Low below previous week low by 25% of ...
There are quite a number of patterns that work around the weekly STOPD price levels giving us a solid edge. This one is a classic bearish continuation setup. Net gain chart below. The Setup [DTBMember] Low below previous week low by 25% of ...
