Markets Are Very Complex And Constantly Changing

Alan Greenspan at the opening of the symposium under the auspices of the Federal Reserve in Kansas City said: ‘The uncertainty is not only an important feature of the monetary policy landscape; it is a defining characteristic. ” He said that the macroeconomic model is much simplified. Indeed, the economy is complex. There are so many forces and variables, both known and unknown, affect the economy, which take into account all possible. Dan Miller often says this. Economy – not single complex system.

Complex systems are widespread in nature. It’s believed that author sees a great future in this idea. Ancient philosophers such as Heraclitus of Ephesus, has long made this observation. All elements of the world, such as time, fire, water, earth and air – permanently reside in a state of flux and, figuratively speaking, can not be ‘twice to enter the same river. ” Nature continually separates and reunites itself. Market – not the exception. You will never enter into exactly the same river (the market) which traded before. He may look the same, but will be different.

Flow will be faster or slower (volatility), it will be deeper or shallower (volume), the water will be more clear or turbid (visibility). There are thousands of variables, and almost none of them comprehensible. But how do you think, what is the biggest variable of all, you probably think permanent? How exactly put Pogo: ‘We have met the enemy and it is – we do! ” Your psychology is also constantly in a state of flux. Are you happy today and tomorrow, melancholic, you continually learn new things about the market and forget the others, your confidence wavering, and unfolds like a river. When You have come to their retail space, something was not wrong or it was all right? How expensive? What was the mood of your friend – the trader, when you come from? How was your first deal? Everything moves, regardless of of whether we see it and can it be measured. Understanding this is especially important for system developers or traders using ‘black boxes’. This helps explain why some programs work well in a very short time. There are many other reasons for these phenomena, but the interaction of changing market forces, of course, plays a major role. How can you deal with constant change? First of all, always be on guard. Expect them. Accept it as normal. Second, protect your profits from unexpected destructive actions. Risk management, the type of stop-loss is vital. Constant vigilance can change a lot, a healthy skepticism can save lives. Third, always study the specific market in which you trade. Develop a stast to trade. Work on the formation itself, as the Zen – a trader, when you become one with the market and feel its motion, as if floating on river. None of these approaches is not easy, but without them becoming a successful trader.