A Technical Approach To Trend Analysis: Practical Trade Timing for Enhanced Profits
by Michael C. Thomsett
Game Theory Applied to Trend Analysis
An element of statistics is associated closely with game theory, a science involving the mathematical and statistical decision-making process. It is “the study of mathematical models of conflict and cooperation between intelligent rational decision-makers.”7 The underlying assumption of game theory is that decisions are made in an intelligent and rational manner. Part of the culture of the market is based on the often irrational behavior of market participants at large versus the minority of contrarian investors.
Contrarians act as they do not just to go against the majority, but because their decisions are based on analysis and rational conclusions versus the impulsive and emotional approach used (unconsciously ...
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