Internet Markets

As the technical indicators are rigorous mathematical description as a formula, they are easily programmed and therefore form the basis of automatic Internet trading systems. Technical indicators are a very serious drawback – it is their persistence. The indicator shows the point of entry and exit points with some delay, when the market has already “gone” of these points at some distance. Trader is not able to affect the value of these distances and is forced to rely solely on the fact that, thanks to the use of indicators, after a certain number of Transaction total income will generally be greater than the final loss. The inertia of the technical indicators inevitably causes the so-called “subsidence of the deposit” (reduced deposit), ie situation when, after implement a number of transactions resulting loss exceeds the bottom line.

It is obvious that the trading using technical analysis has similarities with the game of roulette, if you bet on red or black. In the first case to make a choice of two financial transactions: buy or sell in the second case – the two colors. However, unlike roulette, where the probability of winning 50-50 and depends on the case, then the probability of the final profits in trading using technical indicators in general, higher than the probability of the final loss. 3. Empirical analysis of financial markets An empirical analysis based on the study and comparison values of financial markets by visual observation. The subject of study in this case is to map the movement of the market as a graph. Empirical trading is based on the ability to schedule “draw” certain kind of “graphic shapes, which characterize the behavior of the market and allow some degree of probability to predict its future behavior.

These figures almost defy mathematical description, it is virtually impossible to program, they can only identify visually. Therefore, in contrast to technical analysis, empirical analysis of financial markets provides a direct part trader in the process. Here comes to the forefront a concept of “quality figures.” What is “quality” figure, the smaller “flaws” it has, the more it approaches the “standard”, the more likely the anticipated market direction. Since the quality of the figure is almost impossible to describe mathematically, quality assessment figure depends entirely on the skill trader. The higher the qualification of the trader, the higher effectiveness of the empirical analysis and, consequently, higher profitability of trading. Thus, the trading using technical indicators – a “game” in financial markets since the indicators provide a quantitative analysis of markets, rather than qualitative, with the indicators should increase the likelihood of profitable transactions with respect to loss-making transactions. Trading with the use of graphic shapes – it’s “work” in the financial markets, ” because the graphical shapes give a qualitative rather than quantitative analysis of the markets. What is “quality” figure, the less they poyavlyayutya, respectively, the lower the number of transactions, but they are all profitable.