Basic Probability

[TheBramble]

EURUSD is currently (22:12 GMT) at 1.3137.

What is the probability it will move down to 1.3118 within the next 6 hours?

What is the probability it will, having moved to that level, move up to 1.3200?

What is the probability it will move to 1.3200 without moving down to 1.3118 first?

 

[trendie]

Whether you seriously and honestly attempt this exercise is up to you. I’ve got a fairly good idea of those who might respond, and of those, who will have done so with good intent and those who will likely have not. But regardless, let’s see where it goes.

There’s no gold star or prize and no dunce’s hat for this one. The object of the exercise is not in the answers you may give. I’ll give it a few days to make sure everyone is really bored before I disclose the purpose and results of the exercise.

Many of you may already be aware of its purpose and likely results - I’d appreciate you not disclosing it.

This is a genuine test so please do not google the answer or research it anywhere else. You’re not expected to know the ‘right’ answer. I really want your ‘best guess’. Based on hunch.

Select a lower and an upper range that you feel would, with a 98% probability of success, capture the highest recorded speed of any military aircraft, either in prototype or in operational duty, of any country in the world.

So what range of speeds (lowest and highest) in mph do you consider will with a 98% probability, bracket the speed of the fastest military aircraft in the world?

with the caveat of "no dunce’s hat for this one".....

I reckon 0mph and 3,000mph.
(allow for mw to have misunderstood the question, which is most likely, or over-analysed the question)

Its a bit tricky, and open to interpretaion, as helicopter gunships are also military aircraft.
And different nations have different requirements and budgets.
And different aircraft have different military roles. (supersonice interceptor/fighter (F-14), or slower ground attack/air support (A-10)).
Then there is the Groom Lake/Area-51 experimental Aurora hypersonic types?

 

[TheBramble]

with the caveat of "no dunce’s hat for this one".....

I reckon 0mph and 3,000mph.
(allow for mw to have misunderstood the question, which is most likely, or over-analysed the question)

Its a bit tricky, and open to interpretaion, as helicopter gunships are also military aircraft.
And different nations have different requirements and budgets.
And different aircraft have different military roles. (supersonice interceptor/fighter (F-14), or slower ground attack/air support (A-10)).
Then there is the Groom Lake/Area-51 experimental Aurora hypersonic types?

That’s a valid response mate. Lower bound. Upper bound. The first to play. Thank you.

Don't start with the 'open to interpretation' or you'll get 'that lot' off again with their own brand of smoke and mirrors...It is as unambiguous as can be. There are no tricks or trips. And even if you knew nothing about the dynamics of flight, there can’t be many who would imagine any helicopter gunship is a contender for the fastest military aircraft. Amazing bits of kit that they are…

If you want to quote unofficial figures for Aurora and gas-pipe that’s fine too. The object is to come up with a guess sandwiched between a lower and upper speed to provide a range which gives you 98% confidence of being correct.

 

[trendie]

That’s a valid response mate. Lower bound. Upper bound. The first to play. Thank you.

Don't start with the 'open to interpretation' or you'll get 'that lot' off again with their own brand of smoke and mirrors...It is as unambiguous as can be. There are no tricks or trips. And even if you knew nothing about the dynamics of flight, there can’t be many who would imagine any helicopter gunship is a contender for the fastest military aircraft. Amazing bits of kit that they are…

If you want to quote unofficial figures for Aurora and gas-pipe that’s fine too. The object is to come up with a guess sandwiched between a lower and upper speed to provide a range which gives you 98% confidence of being correct.

in that case, 1,400mph and 3,200mph.

 

[TheBramble]

in that case, 1,400mph and 3,200mph.

Even better. The 'zero to infinity' response would be a syntactically valid answer to the question, is ultra-safe, but doesn't convey any information.

I thought when you initially cited zero for the lower bound you were thinking of that 747 on the conveyor….

 

[TheBramble]

EURUSD is currently (22:12 GMT) at 1.3137.

What is the probability it will move down to 1.3118 within the next 6 hours?

What is the probability it will, having moved to that level, move up to 1.3200?

What is the probability it will move to 1.3200 without moving down to 1.3118 first?

The purpose of post #121 was to propose an assessment of EURUSD using whatever tools we choose to and to gauge the relative merit of each based on subsequent price action against the analyses provided by those tools. I was then thinking we could drill down to establish which techniques used elements of frequentist probability and to what degree – and which used alternative evaluation methods. A bit of on-the-hoof comparative probability. It was just a thought.

It was obviously too late or boring for any takers.

But for those of you amazed at my prescience and almost to-the-pip spot-on analysis, I have to tell you, where the rubber meets the road, I am also as prone as any to execution failure. My limit order at 3118 with a target of 3200 wasn’t filled. Had it been a limit order at 3121….

3 pips out and it cost me a potential profit (and therefore an effective loss) of 79 pips.

C’est la Vie.