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Strategies & Market Trends : DAYTRADING Fundamentals -- Ignore unavailable to you. Want to Upgrade?


To: Dotty who wrote (4147)9/17/1999 11:44:00 AM
From: TraderAlan  Read Replies (1) | Respond to of 18137
 
D.com,

Inefficient markets refers to the time lag between the sum of all current market knowledge and ability of price to respond to it. Buyers and sellers react to what is known and generate volatility in the form of price wave movement, seeking equilibrium. Of course, market knowledge is always very complex and always changing. The activity of market participants is akin to trying to hit a moving target.

Traders use this inefficiency to find opportunity, with the assumption that price will eventually reflect what is known.

Alan