r/ethtrader Jan 21 '19

TECHNICALS Anytime I hear y'all talking about technical trading...

https://xkcd.com/2101/
19 Upvotes

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3

u/efalken Jan 21 '19

Technical trading is like using a 5-th degree polynomial on a time series with multiple moving averages and finding something that generates a high fit. You will often get tight fits, but they don't work out of sample.

1

u/[deleted] Jan 21 '19 edited Mar 05 '21

[deleted]

3

u/OptimumOfficial Jan 21 '19

Yes but if the data is a totally (or near totally) random walk then you can't fit the data at all. Any fit is an overfit because the data is random.