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Irae Ragwan
Posted - 2010.09.26 02:44:00 - [151]
 

Originally by: Vaerah Vahrokha
Originally by: Irae Ragwan
Slightly off-topic, though I have enjoyed the free education:

Related to threadnaughts like this and those posted by other market heavyweights such as Akita T, how much do you wager they influence the markets? I've been casually trading on my alt for years now and kept abreast of things in this very forum. Most every trader I know is at least a lurker here if not a fan of someone. My supposition is, with a large portion of the traders (at minimum those who trade in meaningful volumes) tuned into this forum on a regular basis: do you patently expect to generate market flux with your posts or is that something you see as an unavoidable side-effect of market discussion with real, rather than hypothetical, units?


There are several noticeable differences. Akita T is an older player, performs a lot of fundamental analysis, has the cash to be a market maker and so on. Plus is playing the markets the "old, proven way".
I don't have a reason to get "rich" in EvE as I am a newer player who came too late in this MMO and with my limited available game time I don't have any hope to ever be relevant in "heavy weight" things. But I have done some RL trading and like to do innovative things in MMOs so I am implementing these techniques in EvE.


I wasn't attempting to accuse you of market manipulation as the aim of your posts, but rather asking if you'd noticed trends based on the press they get here. I've actualy noticed marked benefits from riding forum-induced swells from time to time; however, I was never completely sure that it wasn't just a natural spike with slight distortion or what.

Alain Kinsella
Minmatar
Posted - 2010.09.26 04:08:00 - [152]
 

Originally by: Irae Ragwan

I wasn't attempting to accuse you of market manipulation as the aim of your posts, but rather asking if you'd noticed trends based on the press they get here. I've actualy noticed marked benefits from riding forum-induced swells from time to time; however, I was never completely sure that it wasn't just a natural spike with slight distortion or what.


Curious about that too, but my own take is that it's (overall) unlikely. As you said, there are many who quietly follow here, so trying to find proof of these posts being used to help manipulate markets is hard - both sides will point to examples (possibly the same ones).

In Eve's Market - just as in RL - the final responsibility rests on the person punching in that order. Individuals such as Akita and VV are useful (in their own ways) in educating the 'common' Eve trader, but in the end its your call (and your ISK).


For VV - In following the thread, it feels like some of what's discussed here can be simplified by using the 'Turtle' ruleset/mindset (either the original method from Dennis, or a modified form). I may have this backward; the 'main' books on the subject tend to be somewhat hazy on specific execution (for obvious reasons).

Either way, I appreciate what's discussed here, both for Eve and (eventual) RL application. Thank you.

Vaerah Vahrokha
Minmatar
Vahrokh Consulting
Posted - 2010.09.26 10:08:00 - [153]
 

Edited by: Vaerah Vahrokha on 26/09/2010 10:39:16
Originally by: Irae Ragwan

I wasn't attempting to accuse you of market manipulation as the aim of your posts, but rather asking if you'd noticed trends based on the press they get here. I've actualy noticed marked benefits from riding forum-induced swells from time to time; however, I was never completely sure that it wasn't just a natural spike with slight distortion or what.


I don't think I am going to impact on markets on the short term, I am using examples of items that either would not be steered a lot anyway (ie Robotics, Technetium) due to the large capitalization behind them or that are didactic but are not "strategic" enough to have people bother beyond curiosity (IE Starbase Charters, Multifrequency M etc.)



Originally by: Alain Kinsella

Curious about that too, but my own take is that it's (overall) unlikely. As you said, there are many who quietly follow here, so trying to find proof of these posts being used to help manipulate markets is hard - both sides will point to examples (possibly the same ones).

In Eve's Market - just as in RL - the final responsibility rests on the person punching in that order. Individuals such as Akita and VV are useful (in their own ways) in educating the 'common' Eve trader, but in the end its your call (and your ISK).


For VV - In following the thread, it feels like some of what's discussed here can be simplified by using the 'Turtle' ruleset/mindset (either the original method from Dennis, or a modified form). I may have this backward; the 'main' books on the subject tend to be somewhat hazy on specific execution (for obvious reasons).

Either way, I appreciate what's discussed here, both for Eve and (eventual) RL application. Thank you.



Turtle Trading is quite dead in these days, RL markets are as a PvP game as EvE is (actually, vastly harsher than EvE) therefore when a winner strategy is found, the markets adapt and counter it in few months / years so it loses its edge. This happens because:

- large market makers don't like "small fries" to win, at all, therefore they watch and destroy the ones who are imprudent enough to apply a certain predictable strategy.

- institutional bots are easy to be patched to counter predictable strategies like Turtle Trading.

- once found such a strategy, everyone and their dog jump onto the bus and make it useless in short time.

- modern markets are engineered to be choppy, whipsawing, irregular, unpredictable much more than in the past. This exactly to screw "tranquil" strategies like that.

Vaerah Vahrokha
Minmatar
Vahrokh Consulting
Posted - 2010.09.27 08:12:00 - [154]
 

Edited by: Vaerah Vahrokha on 27/09/2010 08:13:28
Illiquid / choppy / niche ranging markets part 2


Let's see another ranging market, taken at Amarr.
Since in part 1 we have seen a very simple example, we'll look for a slightly more technical market this time.

In the following graph, it's possible to see at first sight that this market is choppier and shows a different density at its middle compared to the outer parts.
In fact, ignoring manipulations (the tall volume spikes), price seems concentrated in the 2.2k to 3.8k range but there are also several instances of price at 2.0k - 2.2k and 3.8k - 4k (RNs and BRNs as usual).


Picture linkage


Now let's work on the graph a bit.
We get something like the following picture:


Picture linkage


Why did I only highlight the inner range (in blue)? Because the outer bands should be used as bonus opportunity but not relied upon and they are far from being risk free.

I.e. while you could buy at 2.2 and sell at 3.8k with clockwork execution, the outer levels are slower and riskier instead.

If you happened to look at the market at August, you'd be good to buy at 2k but it'd be risky because nothing would indicate that price wouldn't keep dropping never to recover again (just think about the impact of PI on this item).
On the other side, if you happened to try and sell at above 3.8k you'd see how this happens but it's a rarer chance and therefore you have to stay in the market (and money tied) for much longer waiting for the opportunity.

Buying and selling inside the range at appropriate pivot lines (I marked the 7 prominent ones) is just safer and quicker.

Finally, notice how ranging markets in EvE look more asymmetric in the upper vs lower halves of the range than RL markets. This is due to the lack of short selling at the upper levels.

prostuclasei
Posted - 2010.10.03 11:09:00 - [155]
 

which indicator did you use to look at this? By the way, I'm curious as to which indicator would be best to use in eve. Fibonacci retracement?

Vaerah Vahrokha
Minmatar
Vahrokh Consulting
Posted - 2010.10.03 12:28:00 - [156]
 

Originally by: prostuclasei
which indicator did you use to look at this? By the way, I'm curious as to which indicator would be best to use in eve. Fibonacci retracement?


I used the best indicator, the one sitting between the ears.

I'll use Fibonaccis when a trend shows retracements but the above are not cases of such situation.

Vaerah Vahrokha
Minmatar
Vahrokh Consulting
Posted - 2010.10.03 12:30:00 - [157]
 

More on pivot lines, trend lines, BRNs

We have covered what these entities are and how they affect the market.
I am just going to show more of their effects and applications and how they are related.
Notice that the whole terminology and examples are adapted to EvE, they don't match RL terms at 100%.


Big Round Numbers aka BRNs

These are psychological price hot spots, a technical analyst will use them very often.
BRNs are round numbers, usually with four or more zeroes (i.e. 1,000 but also 1.000). Akin to BRNs are the RNs or "Round Numbers". The latter have much less importance and have 2 or 3 zeroes.
While BRNs could mark important turning points, RNs usually act as little "notches" or bumps in the market flow.

Traders, expecially the big "market makers" (MMs) like to place their orders at easy to type / remember levels. BRNs are just their choice represented on a graph, nothing fancy.
This is also why people asks me why TA is supposed to work and I have no difficulty pointing them at these so "natural" things that just happen.


Pivot lines

Pivot lines are horizontal lines drawn on a chart.
They may have several originating factors. Traders love to place their orders at BRNs. If an item has lots of "action" centered around 10k ISK across several months, that 10k is a BRN that originates a pivot line, i.e. a simple line connecting the "dots".
Prices don't come "just" with yellow dots though, but also have "shadows" - little dark orange-ish lines that may exist above and below the dot. They represent where price ranged thru the day, from a minimum to a maximum. Some Lines and pivot lines will touch those maximums or minimums as well.
Therefore even if the price won't exactly lie on a line connecting many dots, it's probable its daily minimum or maximum will.

Some other times, pivot lines come off simple demand and offer, bulls and bears figthing for price. Every day price will float around the equilibrium between these forces. When price won't end up coinciding with a BRN, it will sit in some intermediate position. When the same equilibrium is reached for 2-3 or more times, it's possible to connect those prices with lines and see if this behavior keeps going on.


Trend lines

Many times the resulting line will be horizontal (so, still a pivot line) other times joining the dots will draw a diagonal line aka trend line.
These lines are useful because they tell where price is going and they also act as dynamic barriers / pivots to price, like the horizontal ones do.

Knowing that trends tend to last for a while and that price is sitting on a dynamic support / resistance is a valuable knowledge.

Vaerah Vahrokha
Minmatar
Vahrokh Consulting
Posted - 2010.10.03 13:10:00 - [158]
 

Example

Follows an example of the various bits snapping together: Nocxium.

This is how the raw graph appears as of yesterday:


Picture linkage


And this is how it appears after some paint work:


Picture linkage


Notice how this is a textboox example of the previous article about pivot lines etc.

The long rising blue line 1) is a trend line: some points sit on it and it's quite immediate to see how price really follows that line.

The red sequence of arrows 2) shows the typical zig zag motion that markets have. By looking at how that motion interacts with the above line, it's possible to detect important change points that are shown all to the right.

The cyan horizontal upper line 3) is a pivot line formed by maximums (first part) and price dots (second part). This line is why in another thread I cautioned Block Ukx against buying. The line is strong (price is being rejected down) and is also right below BRN 300.00, another strong resistance source. Notice how continued testing of this line weakens it, if price keeps pushing for some days it'll eventually break.

The green curve is the SMA 20. It has been prolonged into the future to show how price could interact with it.



Putting the above together

Price is going to hit the cyan resistance line. It may hold or it may not. If it won't, price will break it and jump up, probably above 300.00 (since buy orders will be put at 300).
This is NOT a signal to buy yet, though. The signal to buy would be: price going slightly above 300, then a retracement down to 300 and the buy would happen as price rises right above the price before the dip to 300.

If price won't manage to break the resistance line, it will possibly bounce down to the first support, the green SMA 20 (acting as dynamic support). Then it could bounce up to the blue trend line which now will play as dynamic resistance in place of the cyan line. It'll drop down again, probably trespassing the green line (this would be a sell signal) and bumping on the 250.00 BRN before diving down.


Of course this whole scenario has to be updated every day since it's adaptive and "heuristic" and not written in stone. It's i.e. possible that price would not bounce at the green SMA due to volume or whatever, these are just "common price patterns".

Vaerah Vahrokha
Minmatar
Vahrokh Consulting
Posted - 2010.10.05 10:12:00 - [159]
 

Edited by: Vaerah Vahrokha on 05/10/2010 10:13:22
Spotlight on Nitrogen Isotopes


This item has been negatively affected by PI and lost a lot of "fair value", about 27%.
Now, there are some new factors that could make this item temporarily interesting again.

- Robotics stopped skyrocketing and is forming a double top or an oscillation.

- Other PI fuels tanked or are in a down swing, which makes POS operation cheaper again.

- It's October, i.e. when demand starts to rise for the Christmas time / next patch and there have been actually sizable purchase transactions right in the last days.

- The other years, there have been an head and shoulders forming around Christmas time.


Depending on how Robotics (coolant etc, but Robotics are the "though nut" since the others cost less and tanked) will fare the next days, isotopes could react and rise.


Let's see Robotics first:


Picture linkage


There are 3 possible scenarios for the next days.

1) If price rises to the little green bar to the right, we are going to face an upswing with a new retest of the 35k BRN (too early to say what will happen next, due to the Christmas vacations it could be pulled / kept up till half Jan).

2) If price falls to the red bar pointing at the SMA20 (acting as dynamic resistance), price will hit the low of a swing @31k. It could bounce up and form an upswing like scenario 1 or break it and go to scenario 3.

3) If price falls below to the purple bar indicating BRN 30k, price could tank fast or swap 30k as new resistance and then go downwards at the next swing.



Now let's look at the Nitrogen Isotopes graph:


Picture linkage

In the last days something relevant enough happened that made price oscillate. Be it a change in demand vs offer balance or just a manipulation, the news are that someone Market Maker turned his attention to this market, that is he / they considered it worth considering.
This is a change of focus compared to the quite monotonous downward drift.


Possible signals for the next days:

- In case Robotics scenario 1) happens, there's probably not a lot to do.

- In case scenario 2) or 3) happen, it's possible to see the following:

a) Price breaks the SMA20 (green) downwards: it was a manipulation and price will keep going down till a retest of RN 270. Since there were previous tests of that price level, it's entirely possible RN 270 will break downwards as well.

b) Price rebounds and tests RN 290 from the downside. Recently this pivot line has been easily broken and therefore I'd be ready to see a jump above 290 in few days and then scenario c).

c) Price returns above 290 or bounces below 290 and then goes beyond 290: price will go and test BRN 300 pretty fast.


This time I'd really love to hear opinions, expecially off the Fundamental Analysts out there like Akita T or AnakieNine.

Gamarabi
Sweeper Group
Posted - 2010.10.05 10:30:00 - [160]
 

I am really starting to like this little project. I am swing/day trader at a uni so I can't help but find this intersting, although techincal analysis tends to bore me a bit at times.


Considering there is usually a major change to the gameplay and as such the economy, I'm fairly certain you won't find to many items where you will find a retracement.


Vaerah Vahrokha
Minmatar
Vahrokh Consulting
Posted - 2010.10.05 21:00:00 - [161]
 

Quote:

Considering there is usually a major change to the gameplay and as such the economy, I'm fairly certain you won't find to many items where you will find a retracement.



There are some differences that I believe are due to two important factors:

- in EvE there's no leverage. This kills medium investors and speculators who don't have the weight to impact on a market enough to cause "ripples" and retracements. Therefore we assist to a more bland scenario, where we tend to see big market makers who impact a lot (more than RL) and will drive a market only in one (their) direction and we see end consumers / retailers who are not relevant at all.

- in EvE graphs, there are not the choice of indicators that are used in RL. This means that i.e. EMAs or CCI cannot be immediately used on graphs and therefore we won't "catch" all of the retracements we could see otherwise.

Just having an EMA 9 and an EMA 21 would help spot entries earlier and in a safer way.

Talmeric Eratirel
Posted - 2010.10.06 11:47:00 - [162]
 

Edited by: Talmeric Eratirel on 06/10/2010 12:20:54
No english speaker here, excuse me if I'm not clear.

VV, thanks for your posts and for the time you consume to make it, this is really interresting, even for a complete eco. noob like me. I found your thread yesterday, starting to read it, and sudently it was morning and my browser have a bajillon tabs opens ^^

I really don't know anything about markets, but your posts are clear, easy to follow / understand (even if it look like a little bit esoteric sometimes), so, a big 10/10 for you.

[EDIT] I have a question regarding the "Cut your loss" part. Why don't you keep the items if the price is going down too fast for the moment, you can sell them later when the prices go up (even if it's a year later, for the christmas up for example). It's frozen isk, but if you used the 4% invest advice, it shouldn't be a big problem, and it's better to make profit on the long time instead of a direct loss, isn't it ?
I can understand this rule for the IRL market, where your share could become useless if the corp is disbanding (using the eve terms because I don't know the proper english terms Embarassed) but in EVE, Heavy Fury Scourge Missiles will always be useful, therefor, they will always be one the market.

This is certainly a stupid question, but hey, I'm here to learn :D

Vaerah Vahrokha
Minmatar
Vahrokh Consulting
Posted - 2010.10.06 12:32:00 - [163]
 

Originally by: Talmeric Eratirel
No english speaker here.

VV, thanks for your posts and for the time you consume to make it, this is really interresting, even for a complete eco. noob like me. I found your thread yesterday, starting to read it, and sudently it was morning and my browser have a bajillon tabs opens ^^

I really don't know anything about markets, but your posts are clear, easy to follow / understand (even if it look like a little bit esoteric sometimes), so, a big 10/10 for you.


Thank you for your appreciation! Very Happy


-------------------------------------------------------

On a partially unrelated matter...

I'd like to repeat here what I said in game on SCC Lounge: this thread original intent was to find possible common features between EvE and RL markets. This would allow the tools used in RL trading to be useful for trading in EvE.

If that would prove to be true "enough", I could try trade again. I just cannot stand 0.01 ISKing and similar, but I find it fun to do this other way instead.

Most of all, the assumption was that those few reading this thread would have the financial and technical background to immediately understand what was shown and would basically discuss on my same terms.

I have to say the reactions were somewhat different and that there are people who actually don't know about this stuff but would like to.

Now, teaching is not my forte and TA is something taking huge tomes (yet, you can sum it up with: "buy low, sell high Cool") but if someone has specific questions, feel free to ask here and I'll try and reply at my best.

Claire Voyant
Posted - 2010.10.06 13:07:00 - [164]
 

Nitrogen Isotopes:
I have many, many years of experience trading Nitrogen Isotopes on a daily basis, so let me give you some fundamental analysis for free. The ice and ice products market is a classic boom and bust economy. Prices go up and people start to mine more ice and take down their towers, prices go down and people stop mining ice and put up more towers. Ice miners and POS managers are "leave it and forget it" people. They (along with ice traders) are among the laziest professions in Eve. So they tend to mine ice long after prices have fallen (I know you do VV Wink) or keep fueling their towers even after prices have risen. So the boom-bust cycles can be long, even more than a year. One huge problem with the Eve Market graphs is the one-year maximum prevents people like you from seeing the "big" picture, the larger trends.

Nevertheless, those booms have ceilings and those busts have floors. 200-250 is the historic floor for isotopes, but there are signs that the turnaround may begin a little earlier this time. My favorite leading indicator is liquid ozone. High sec ice produces liquid ozone at a 1:12 ratio to isotopes, while towers consume liquid ozone at up to a 1:3 ratio. That means that in the case of a market glut, liquid ozone stocks will tend to run out before isotope stocks. Liquid ozone has clearly turned the corner which means that isotopes are probably not too far behind.

This weekend's nitrogen bump was clearly an attempted manipulation. Sell orders were relatively thin, and someone bought up the lot (up to 340-350 I think) Saturday morning. I'm pretty sure it was a single trader or a coordinated manipulation, because on Sunday night large numbers of sell orders at 300 and above were removed (or moved higher) even though their was a huge blocking sell order at around 295 that remained in place. By Monday morning everything was back to normal with competitive sell orders around 285 which have since moved down to 275.

From a fundamental standpoint, we are clearly approaching the bottom. The key question is obviously when will that bottom be coming (and more importantly, at what price.) My main point is that this cannot be determined by looking at any number of price graphs (unless that price graph is from some point in the future.) It depends on the amount of stocks out there waiting to be sold and, more importantly, when producers and traders decide it will be more profitable to hold on to their stocks than to sell at current prices. When it happens we will know it, but not until then. It can probably be sped up if speculators come in to buy up stocks (and hold them) but short-term manipulators are probably not as significant. (Unless that manipulator gets stuck with inventory and decides to turn into a longer term speculator.) Of course, a manipulation may "catch" but only if it comes at the point when the market is ready to turn and if the manipulation is large enough and the manipulator is patient enough.

As for Robotics and other PI, I can't see them having any short-term market impacts on ice. Eventually they will find their equilibrium price and tower operators will have to reevaluate their profitability, but don't expect any day-to-day effects to show up on your graphs. It will probably mean that we won't be seeing isotopes at 600 anytime soon, and it might mean the floor dropping below 200, but other than a general depression of ice prices (same with the sov changes) it is too soon to say.

The only other approach that I see possibly working is a sophisticated analysis of market orders and order tracking. Clearly you could refresh the market data on a continual basis and track new, filled, modified, and canceled orders. That would give you up-to-date information on the market players except for stocks in hangars and in transit. You could probably tell pretty quickly when the market momentum shifts, but by then it would still probably be not sufficiently predictive.

Vaerah Vahrokha
Minmatar
Vahrokh Consulting
Posted - 2010.10.06 13:51:00 - [165]
 

Edited by: Vaerah Vahrokha on 06/10/2010 13:53:10
Quote:

They (along with ice traders) are among the laziest professions in Eve



You see? We are on the same wave length Razz


Quote:

So they tend to mine ice long after prices have fallen (I know you do VV )



Yeah I have a rusty laptop sitting here. While I wait for a program to get compiled or similar, I just look at the screen if it's time to unload or not.
That's often as much of playing EvE I can do in a day.


Quote:

My favorite leading indicator is liquid ozone



You would not believe at the coincidence but that's exactly the item that pushed me to look at looking at isotopes (I go out of ozone myself).
I noticed a big spike and I thought: "be it some large refuelling service that buys at the 1st of the month or whatever, price went up".


Quote:

My main point is that this cannot be determined by looking at any number of price graphs (unless that price graph is from some point in the future.)



This is not a different issue than RL trading on some indexes, where all you got is some general sentiment about the future.
This is dealt with, I don't see why it should be harder or different in EvE.

The only difficulty I found with EvE markets so far is how spikes may be caused by some large speculator and they can affect multiple markets "like a real event". In RL such spikes would be so prominent that could not have been done by a lone institution and would really point to a change in trend.


Quote:

As for Robotics and other PI, I can't see them having any short-term market impacts on ice.



An idea that I am not alone to believe is that those PI fuels incremented the costs of upkeeping a POS so much that many just dropped theirs and thus created a lower demand for ice products than before.
It's not short term but the two look to be correlated.

Claire Voyant
Posted - 2010.10.06 16:57:00 - [166]
 

Originally by: Vaerah Vahrokha
An idea that I am not alone to believe is that those PI fuels incremented the costs of upkeeping a POS so much that many just dropped theirs and thus created a lower demand for ice products than before.
It's not short term but the two look to be correlated.

Two straight lines are perfectly correlated, but correlation does not imply causation.

Smart tower operators bought up their NPC fuel while it was still NPC fuel. NPC orders were so broken that the supply was basically unlimited if you knew where to look. It is possible that some really smart tower operators took a look at their now very valuable stock of NPC fuel and shut down their tower anyway (I know that's what I did, but I was also getting bored with research jobs.)

Actually, ice prices have been falling faster than NPC fuels are rising, so that implies that it is the expected future price of NPC fuels that is depressing ice prices, not the current price.

prostuclasei
Posted - 2010.10.06 18:57:00 - [167]
 

Edited by: prostuclasei on 06/10/2010 18:58:28
Vaerah Vahrokha, do you use elliot wave theory in your technical analysis in eve?

Talmeric Eratirel
Posted - 2010.10.06 19:56:00 - [168]
 

Originally by: Vaerah Vahrokha

Now, teaching is not my forte and TA is something taking huge tomes (yet, you can sum it up with: "buy low, sell high Cool") but if someone has specific questions, feel free to ask here and I'll try and reply at my best.


I edited my post but apparently you didn't see it:

Originally by: Talmeric Eratirel
I have a question regarding the "Cut your loss" part. Why don't you keep the items if the price is going down too fast for the moment, you can sell them later when the prices go up (even if it's a year later, for the christmas up for example). It's frozen isk, but if you used the 4% invest advice, it shouldn't be a big problem, and it's better to make profit on the long time instead of a direct loss, isn't it ?
I can understand this rule for the IRL market, where your share could become useless if the corp is disbanding (using the eve terms because I don't know the proper english terms ) but in EVE, Heavy Fury Scourge Missiles will always be useful, therefor, they will always be one the market.

This is certainly a stupid question, but hey, I'm here to learn :D


Thanks again.

Vaerah Vahrokha
Minmatar
Vahrokh Consulting
Posted - 2010.10.06 20:53:00 - [169]
 

Quote:

Vaerah Vahrokha, do you use elliot wave theory in your technical analysis in eve?



I use its concepts, if you read the thread you'll see how often I talk about markets being auto-similar or look like fractals. Fractals off human behavior psychology, something quite hard to "fix" with a formula.
Discerning the actual waves is hard with EvE markets, the minimum period (day) won't make it possible to see anything fractally detailed.
Still, we do see accumulation and distribution, the ascending and (steeper) descents, they are the two prominent faces of those waves (phase 1-5, then a-c).


Quote:

I edited my post but apparently you didn't see it:



Sorry, (crappy and demeaning) RL work forbids me to dedicate much attention to EvE.


Quote:

I have a question regarding the "Cut your loss" part. Why don't you keep the items if the price is going down too fast for the moment, you can sell them later when the prices go up.

...

I can understand this rule for the IRL market, where your share could become useless if the corp is disbanding




Actually in RL it's not just about shares but also currencies and futures. For shares you quite described it, for currencies (and worse, for futures) you have NO guarantee the security will be back to the previous level. Now, there's often sensible leveraging involved as well, just staying invested overnight could prove to be too much for a $20,000 account, much less waiting for months.

Now, this is also valid for EvE (I'll stay generic in the examples, don't bite me for the 10 ISKs off). Patches or even just large wars act as "trauma" events. If you bought 10B in Nitrogen Isotopes at 500 ISK p.u. today you'd see your 10B turned irrimediably to 5.5B. Irrimediably as in you are to stay short of money for who knows how long, since game changes made the item less worth at its fair value.
If you invested in some Fury missiles you'd see their value dropped by 20% vs the last year. Who knows if they'll recover? With the new materials balance?
What if you invested in capital components? They'd tanked "forever" due to game changes as well and at the next "insurance value update" runs, they'll drop again.

At the same time, those billions would create other billions if you had them in your pockets.
If you signed as lost 20% of 10B after 2 months, you'd have now the remaining 8B working for you since 10 months instead of having them ransomed in some dead item.

Talmeric Eratirel
Posted - 2010.10.06 22:35:00 - [170]
 

Originally by: Vaerah Vahrokha

Sorry, (crappy and demeaning) RL work forbids me to dedicate much attention to EvE.



He he, no problem, actually, you are the men taking on his RL time to explain things to noobs like me, so you really don't have to be sorry.

Originally by: Vaerah Vahrokha


Actually in RL it's not just about shares but also currencies and futures.

(...)

At the same time, those billions would create other billions if you had them in your pockets.
If you signed as lost 20% of 10B after 2 months, you'd have now the remaining 8B working for you since 10 months instead of having them ransomed in some dead item.



That's pretty logic to me, but I didn't thought about it ... I said it was a stupid question. Also, I didn't thought about item wich had their price lowered due to CCP's patches (wich is more stupid).

Anyway, thanks again for your work and for the time you gave me.

prostuclasei
Posted - 2010.10.07 05:11:00 - [171]
 

Edited by: prostuclasei on 07/10/2010 05:38:25
1. Is it possible to view the eve market chart in candlesticks?

2. Can you give any advice as how to identify if resistence or support is truly broken and is not a false breakout?

Vaerah Vahrokha
Minmatar
Vahrokh Consulting
Posted - 2010.10.07 11:01:00 - [172]
 

Quote:

1. Is it possible to view the eve market chart in candlesticks?



Not directly, because EvE won't draw the candles "body" but it's possible to:

1) See some candlestick formations

2) Build the full candles with the market data at downtime.



Let's see the above in more detail.
I'll use this site as easy reference.


1) Candlestick formations

Formations involving precise analysis of the candles bodies cannot be easily detected (see next point). It's possible to detect key candles though.

The following graph about Robotics is an example:


Picture linkage

Some candle formations will be approximately discernible: long legged dojis (indicating market uncertainty), dragonfly and gravestone doji (see linked page), hammer, hanging man, shooting star.
Big attention must be paid by the fact that the "yellow dot" is just a price average for that day and does not convey a "body" shape.
Therefore it'll take a bit of practice with RL markets to figure out that in a certain part of the graph we are seeing a doji and not a marubozu (full length) candle.
The moving averages can help here, since in a trending market it's very possible to see i.e. a doji / hammer etc. at the extremes of swings but less at the center and where SMAs run almost horizontal.


2) Building the full candles

I did not find this construction to be really useful and it's lagged by one period (day). Anyway there may be multiple ways to do this (i.e. involving third party external sites) but here is how to do it within EvE:

a) Before downtime or right after it, read the lowest sell order or the average between lowest sell order and highest buy order (such choices are also available in RL trading software). It's not totally fundamental to have a super-precise value.
This will be the close for yesterday and the open for today.

b) At next downtime, redo the above. This will be the close for today-that-is-to-become-yesterday and the open for tomorrow (to become the new today).

Now draw an empty rectangle on top of the graph last completed candlestick (should be the one but last). If you did it correctly, the rectangle will be within or equal to the shadows. Color its inside in green if yesterday's close < today's close and in red if yesterday's close > today's close.
The yellow dot will probably sit in the center of the rectangle, near the upside / downside border (expecially for the "hammer" alike candles) or even near the crossing of the bar with the SMA 5.
The above yellow dot behavior may be used to help approximate what explained in 1) without even drawing the bodies.

Vaerah Vahrokha
Minmatar
Vahrokh Consulting
Posted - 2010.10.07 12:34:00 - [173]
 

Quote:

2. Can you give any advice as how to identify if resistence or support is truly broken and is not a false breakout?



This is not an exact science (like the rest) and EvE lacks of the tools RL trading softwares would provide.

It's still possible to give some advice and simplified "rugged" methods that are possible even in this situation. I will make examples for a buy scenario, since sell is complimentary and EvE does not even give short selling opportunities.


1) First of all make sure you are really facing a support and resistance (i will call them "wall" from now on). BRNs are best candidates but recurring price "walls" work very well too.
Diagonal trend lines also do the job and Fibonacci's retracements when confluencing with one of the above, may give additional clues about what we are facing.

2) Make sure the support / resistance has been tested recently. Price touching aka "testing" a wall makes it evident (you just line up the dots) but the continuous testing causes the wall to weaken over time. This happens because behind the scene, testing means "triggering opposite orders sitting there", the more orders are triggered the easier is they just deplete and then nothing acts as wall any more.

Now, by making sure the wall has been tested recently, you both make sure it's still a wall (an obstacle is what makes price jump and break out) but also that it's weak and easily broken.

3) In RL you have lower time frames where you may enter "early" in the last swing before the break out happens (it often turns a bit up giving the tip) and so you can achieve to "break even" and not lose money even if the break out fails.
In EvE it requires orders pampering. If it's a real break out you should see volume spiking up a bit. Else it's a weak manipulation or you are in a "bull trap", possibly near the top of a peak / head and shoulders (and buying will kill your wallet).

4) Otherwise you just wait for the break out to happen: the next yellow dot appears visibly distanced in the vertical. At this point it's dangerous to enter the market. You should have patience and eventually lose a good opportunity or "try your luck" but then the breakout might reverse in your face since it got no confirmation.

5) If you chose to wait, you have to see price retracing backwards. I.e. it would break upwards and then dip back *a bit*, NOT back to the previous pre-breakout levels. Very visual cases of this are available at major turning points: you will see the SMA 5 pull back to touch the SMA 20 and then go up again).

6) Only after the following steps happened you may buy:

- retrace happened

- and volume stays normal (i.e. if it halves it is NOT a good sign)

- there's an upward trend AND its slope angle is > 15 - 20°

- price rises again and passes the break out price dot going upwards


then you are good to enter the trade and purchase.

7) Watch the next days. If doji (long shadows bars) happen then the break out was weak, be prepared to realize profit. In RL you'd gauge the next bars and see if they stay short and bullish then price will rise well. If they start alternating or getting long and uncertain shapes then price is unstable.

Vaerah Vahrokha
Minmatar
Vahrokh Consulting
Posted - 2010.10.07 14:32:00 - [174]
 

Quote:

It always amazes me how so many people do things like use 20sma's when 7,14,21sma's at least allow more of the cyclic weekday trend to show through the data assuming they exits.



If you refer to EvE, it's because those are the SMAs CCP gives and since I am doing this for free I CBA to use other. In RL I use 9 and 21 EMA, 50 89 200 and 365 MAs to catch other macro-motions and to use them as dynamic pivots (i.e. not using their crosses).


Quote:

I do almost as good simply by just looking at most data/graphs. True it could be because of the previous TA and long term association with trends. I'm not sure.



I think that's the case, once you "get" the markets imho you don't even need to see anything but the raw price.


Quote:

Seasonal Cyclic TA would be nice for eve but eve doesn't give multi year data or graphs which is a real shame as it could encourage more slow long term traders in eve



I checked multi-year data but the patches make it obsolete and irrelevant. Mad

bestsnail
Posted - 2010.10.07 22:31:00 - [175]
 

This will never work because eve doesnt have tons of new products hitting the market each month like a real world market has. Eve is just way to stable due to lack of content development.

CCP Jericho

Posted - 2010.10.08 08:53:00 - [176]
 

Image changed to link in several posts. Jericho

Chesty McJubblies
Gallente
Center for Advanced Studies
Posted - 2010.10.08 16:53:00 - [177]
 

Originally by: Vaerah Vahrokha
Edited by: Vaerah Vahrokha on 27/09/2010 08:13:28
Illiquid / choppy / niche ranging markets part 2


Let's see another ranging market, taken at Amarr.
Since in part 1 we have seen a very simple example, we'll look for a slightly more technical market this time.

In the following graph, it's possible to see at first sight that this market is choppier and shows a different density at its middle compared to the outer parts.
In fact, ignoring manipulations (the tall volume spikes), price seems concentrated in the 2.2k to 3.8k range but there are also several instances of price at 2.0k - 2.2k and 3.8k - 4k (RNs and BRNs as usual).


Picture linkage


Now let's work on the graph a bit.
We get something like the following picture:


Picture linkage


Why did I only highlight the inner range (in blue)? Because the outer bands should be used as bonus opportunity but not relied upon and they are far from being risk free.

I.e. while you could buy at 2.2 and sell at 3.8k with clockwork execution, the outer levels are slower and riskier instead.

If you happened to look at the market at August, you'd be good to buy at 2k but it'd be risky because nothing would indicate that price wouldn't keep dropping never to recover again (just think about the impact of PI on this item).
On the other side, if you happened to try and sell at above 3.8k you'd see how this happens but it's a rarer chance and therefore you have to stay in the market (and money tied) for much longer waiting for the opportunity.

Buying and selling inside the range at appropriate pivot lines (I marked the 7 prominent ones) is just safer and quicker.

Finally, notice how ranging markets in EvE look more asymmetric in the upper vs lower halves of the range than RL markets. This is due to the lack of short selling at the upper levels.



wow

Vaerah Vahrokha
Minmatar
Vahrokh Consulting
Posted - 2010.10.08 17:38:00 - [178]
 

I am sorry, that has been a modification by the above Moderator. I don't think I am even authorized to fix it.

Douglass Bryant
Posted - 2010.10.08 18:28:00 - [179]
 

Originally by: Gabriel Virtus
My post was to point out how futile it is to discuss or draw conclusions about misapplied models/theories and the incorrect analysis of those models/theories to the “data” presented.


I would be helpful and lend credit to your argument if you could describe how the models are being misapplied, how the analysis is incorrect, and how the data is flawed or incomplete (as I assume your quotes imply).

Otherwise, all I see here is a bit of hand-waving.

CCP Zymurgist


Gallente
C C P
Posted - 2010.10.08 21:59:00 - [180]
 

Edited some posts to correct some html errors Smile


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