Replies to post #60 on Larry's Market Comments at Critical Points

[TREND1]

MM you wrote
The way you defined 2 and 4 shouldn't they be the same?

2)Independent = net change in price of stock from one day to another day.
(4)Dependent = price of stock today vs price of stock tomorrow

answer:
(2) and (4) ARE NOT THE SAME
This is a FACTOID= 100% fact

Let me try to explain:
............................................................
(2)If you plot the "change" in prices over say a year, you will get a log normal distribution.
Translation: An almost normal distribution curve, but it has
a long tail to the right.

This is where the random market theory comes from.
......................................................
(4)If you plot the closing prices on a stock over say year,
you get that zig zag line, which "looks radom", but is far
from random. Why? Because today's closing QQQ price has a
memory of yesterday's closing price built into it.
And if you take say the last 4 days and start to predict tomorrow's price, there is more memory(dependency)to the
calculations.
..........................................................

This is the best I can do using the language of English.
The language of "math" allows better transfer of facts.



Larry' BABBLE #board-1468
http://www.geocities.com/larrydudash2004/index.html