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[esoito]

@ Bayes

A devil's advocate question for you:

   
• The forex market is driven by human emotions of fear and greed (in turn determined by global political and economic events that occur)
• The roulette "market" is driven (so we are told) by a random flow of numbers (in turn determined by...well, by what?)

So are "...all the indicators and logic rules in the software..."  truly transferable from forex systems to roulette systems?


NB:  I'm not trying to be "difficult" -- I'm basically seeking reassurance from one whose maths ability is a lot higher than mine!!

[Bayes]

esoito,

Good question! There seems to be some controversy as to whether technical analysis actually works. According to some it's mere voodoo (or at best, pseudoscience). Proponents of the "efficient market hypothesis" say that prices are basically unpredictable or random, so analyzing past prices can't help.  Others say it does have merit, but any merit depends on the fact that many other traders use the techniques and indicators, so it becomes a self-fulfilling prophecy; if thousands of traders are using an indicator to guide their decisions, then their choices will push the prices in the "predicted" direction, so in a sense the indicators are correct to the degree that other traders believe that they correctly model the underlying forces. On the other hand, some say that the charts reveal patterns of supply and demand which are the basic forces that change price. Studies have been done (see the Wiki entry on "Technical Analysis") but results aren't conclusive.

Obviously, psychological factors can't directly influence roulette outcomes, but I like to think there is something analogous to supply and demand, in the sense that (gambler's fallacy not withstanding) outcomes do conform to a kind of "pressure". e.g. a trend cannot continue indefinitely, and patterns can be "predicted" to repeat according to probabilities. For me, the charts and indicators would just be a way of getting a birds eye view of past results, with the intention of using them to make educated guesses (where guesses are "educated" by probabilities). I've used (and do use) point & figure charts for this purpose.

So I suppose the answer to your question is no, the indicators aren't directly transferable to roulette, but that's not to say you can't use/interpret them for that purpose. After all, there is no one way to use the charts and indicators even in a Forex context, they're given meaning only in relation to some hypothesis which can be tested.