The present invention comprises a method using cellular automata to process existing trading data from traders to generate unprecedented output that improves a wide range of future financial trading decisions and alerts for both individual traders and institutions. However, the method and system of the present invention is not a predictive system based on input of market data and it is not algorithmic. Rather, the method and system instead uses cellular automata logic to mimic human trading behavior. Based on the observations of human trading behavior decisions, the present invention generates an output of buy and sells decisions or simply an alert signal. This use of cellular automata as a basis for evaluating trading behavior provides a different basis for generating trading decisions and alerts and forms a new class of financial alerts over the prior art. The method of using cellular automata logic to process financial trading signals is therefore a paradigm shift in the logic behind trading decisions and alerts. It creates a new kind of technical analysis that features cellular automata interacting with human traders and data.
Free Patents Online: Patent Filing for Cellular Automata Financial Trading Method and System
(via Wade)
See also:
Predicting the Future with Twitter
Pi, Plato, and the Language of Nature
From http://technoccult.net/archives/2011/04/01/patent-filing-for-cellular-automata-financial-trading-method-and-system/
Robert Prechter, who uses technical analysis, a theory that holds that there are mathematically computable patterns in the stock market, think’s we’re in for the “big one” in a big way:
Mr. Prechter is convinced that we have entered a market decline of staggering proportions — perhaps the biggest of the last 300 years. [...]
Originating in the writings of Ralph Nelson Elliott, an obscure accountant who found repetitive patterns, or “fractals,” in the stock market of the 1930s and ’40s, the theory suggests that an epic downswing is under way, Mr. Prechter said. But he argued that even skeptical investors should take his advice seriously. [...]
For a rough parallel, he said, go all the way back to England and the collapse of the South Sea Bubble in 1720, a crash that deterred people “from buying stocks for 100 years,” he said. This time, he said, “If I’m right, it will be such a shock that people will be telling their grandkids many years from now, ‘Don’t touch stocks.’ ”
New York Times: A Market Forecast That Says ‘Take Cover’
Related posts:
- Truckloads of Freaks, Strippers, Art and Noodles Drive NYC’s Lost Horizon Night Market
- Paul Krugman: How Did Economists Get It So Wrong?
- Matt Taibbi on naked short-selling
From http://feedproxy.google.com/~r/Technoccult/~3/Hus2AVwy2jU/
