There is a 99.61% Chance that you will win this trade!

12 March 2016, 20:22
Muhammad Elbermawi
4
299

If I told you that there is a 99.61% probability that you can win the next trade on USDCAD would you believe me!

In trading the Theory of Runs  answer a statistical question that ask about the probability to find another black (OR white) candle after a series of them.

The idea is simple, If the last candlestick on the chart was black so what is probability of the next candlestick to be black ?

According to the Theory of Runs  the answer is 50%.

But if you have two consecutive black candlesticks the answer will be 25% ( = 100 * [0.5*0.5] ).

Also,if you have three consecutive black candlesticks the answer will be 12.5% ( = 100 * [0.5*0.5*0.5] ).

Now if you know that USDCAD had eight consecutive black weekly candlesticks the answer will be 0.39% ( = 100 * [0.5*0.5*0.5*0.5*0.5*0.5*0.5*0.5] ).

By another words the probability to have a white candlestick or a rising week will be 99.61% !

good luck for all of you

MB