Replying to Avatar Fiat Shenanigans 🤡🌎

The human brain is a pattern recognition machine, but it generates false positives from randomness. That's why day trading is so hard.
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MrShroom🍄 2y ago

I thought it's hard because nearly all trading traffic comes from a bots that are behaving accordingly to their algorithmic strategy, not getting carried away on fear/greed like humans.

Also it's hard because whales are doing their own game creating those fear and greed traps with good ol pump and dump.

And this thing you are mentioning is also valid and even have it's own name: pareidolia.

Entire technical analysis sorcery is just about trying to find patterns where there aren't any.

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Fiat Shenanigans 🤡🌎 2y ago

Most TA is hoodoo voodoo nonsense. I draw 1 trendline if I can, because there is only ever one trend, and I mark support/resistance levels. Support/resistance is just the assumption that if somebody showed up before to sell at a certain level, they (or somebody else) might do it again if price advertises that level again. You can see from this chart that price action reacted to the levels I marked more often than not.