1. Human desire .... to know the future .... in all aspects of life .... and markets.
Point 1 above is ingrained in us. When it comes to financial markets, the debate will always be about predicting the future. It becomes and ego trip. Sometime or shall I say most of time the fastest route to disaster at Holland.
2. Energy, Force and Water will always flow and move in the direction of the weakest point or lowest resistance path. It does not mean friction-less or no resistance. There will be friction and resistance in the opposite direction but not sufficient to change anything.
The same applies to financial price trends irrespective of the different instruments or products, the price will move in the path that is easiest irrespective of whatever news hit the market.
We will encounter where good positive news will not change a falling trend and bad news can't stop a rising price.
PRICE trend is "independent" ... the news are like spectators jeering and booing from the stadium. Price will move on it's own agenda the path of least resistance irrespective of the news until it is time to change and the last passenger is on board.
3. Prediction and forecasting will not be correct 100%. There has to be allowance for errors and time to materialize.
We are dealing with emotional "markets" and moving "orderly erratic" forward in a non-smooth or non-linear state.
4.Indicators sometime work perfectly and accurately on time to predict price trend reversal. Sometime the price trend reversal is delayed or prolonged despite the indicators changing ahead. Sometimes the price trend reverse abruptly before the indicators can react.
The ultimate trend change is PRICE confirmation.
5. Every trend will come to completion and change direction. It is just a matter of time when this happen and where it happen at which price level.
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