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Strategies & Market Trends : MARKET INDEX TECHNICAL ANALYSIS - MITA -- Ignore unavailable to you. Want to Upgrade?

To: Terry Whitman who wrote (16130)	2/6/2003 12:33:23 PM
From: Henry J Costanzo	Respond to of 19219

<<Keep 'em comin>> Sorry I can't oblige............. I happen to be in the same boat WITH you.......:-)

To: Terry Whitman who wrote (16130)	2/6/2003 8:04:15 PM
From: Dan Duchardt	Read Replies (2) \| Respond to of 19219

Keep 'em comin. The more folks that think I'm an idiot for buying (or selling) the stronger the upcoming move should be. I did not call you an idiot for buying or for selling, and I made no judgement about which way or how far the market is going to move. I wrote a reply and then removed it after realizing somebody else had already pointed out that the statistics you relied on to support your position are flawed and irrelevant. Since you chose to reply, I'll give you a couple of examples. A basketball team has a record of 60 wins and 40 losses. Suppose they are to play a game with a team chosen at random from among those they played to build their record. What is the probability of them winning? Your statistics would show they had a 60% chance of winning, BEFORE the game begins. Now suppose they are down by 10 points with 2 minutes remaining. What are their chances of winning? Their 60/40 record at this point is meaningless. All that matters is their record in games where they have been about 10 points behind with about 2 minutes to play. Unless you have that data, in sufficient quantity to be statistically reliable, you can't make any prediction. Companies who write life insurance for 60 year olds know quite precisely the probability of somebody in the population dying before 60, or living longer. Do they care? Not in the least (for this set of people). All they care about is the life expectancy of people who have already reached age 60. They work very hard at analyzing the data that says when people die OVER THE AGE OF 60. These are both examples of conditional probability. The question is, given that event A has happened, what is the probability of future outcomes? The set of data that covers the case of event A not happening is totally irrelevant, as in the case of this market. The fact that most cycle lows occur in a lot less time than the minimum for this cycle was relevant at the beginning of the cycle. At this point it is totally irrelevant. Make all the arguments you want about how close we are to the bottom based on the economy, crowd psychology, threat of war, etc., etc. Expect to catch a little heat now and then when you invoke flawed mathematics to make your point.