The truth about TA. Why people think they can time the market, why they draw lines on graphs, why some of them end up being right, and how you can avoid being another monkey with a keyboard.

You are a biological machine designed to find patterns.

You need to find patterns to survive, it's the same process that makes you see faces in random objects. It's what drives conspiracy theorists to believe lizards run the world. Our survival is predicated on pattern recognition; when the weather changes, what paths bears take, where the berries grow - it's the most fundamental driver in how you ended up as a monkey with a keyboard on Reddit.

In nature there's two pattern recognition errors you can make, a Type 1 error and Type 2 error. If there's a rustle in the bushes a Type 1 error (false positive) leads you to suspect a tiger where there isn't one. You run away but live to shitpost another day. A Type 2 error (false negative) is to ignore the rustle despite the tiger. Monkeys that make Type 2 errors don't survive to give birth to monkeys with keyboards.

There's not much real debate when we look at the long term studies of traders and firms. They fucking suck dude. Markets are a random walk that trend upwards due to FIAT printing and productivity increases. Any pattern that might have worked gets a counter party that cancels it out. You can't even get better at trading, since improving at something requires repetitive mistakes and corrections with a limited number of controllable variables.

Despite that, millions of talking monkeys stare at charts looking for patterns like we were designed to do. We find spurious correlations, then we make predictions. If we flip the coin correctly we get a dopamine hit. If we flip the coin correctly a few times in a row we look successful, we give ourselves credit for our decision making, we start a YouTube channel, we get a following because we've been right in the past, we're even fucking rich.

Due to the law of large numbers some of us HAVE to continue to be right. Somebody always wins in a game of heads or tails. Every right guess leads to confirmation bias, any wrong guess creates an addictive form of itermittent reinforcement and is wilfully ignored. The monkeys that win the flip a lot and hide their losses the best get a big following.

Maybe they end up running a hedge fund, some of those hedge funds are successful for predicting the right side of the coinflip. They raise billions of dollars. A few of those billion dollar hedgefunds are successful, they win more flips and grow to enormous sizes.

Eventually they end up on the wrong side of a few flips, they're Almeda capital, they're 3AC. Their predictions don't work and they get wiped out COMPLETELY. They start a fly wheel because it's just been bad luck. They leverage to the tits. They get it wrong and then things blow the fuck up.

Avoid the trap. Ignore the charts and the dumbass arrows. Buy over time, sit on your hands, fight your instincts, eventually reap the rewards from the increase in productivity, network growth and FIAT printing. The richest bitcoiners aren't the ones who traded, they're the ones who fucking went to jail and couldn't sell. They just needed to wait and let the market do it's work.