Trading Strategy: Human Subjectivity vs Computer Objectivity

Human Subjectivity vs Computer Objectivity

In the note at the beginning of this manual, John Murphy alluded to the difficulty in creating this product. Bottom line-it is no easy task to teach a computer software program to recognize chart patterns. It is no wonder that there is so little competition in this market.

Ask any technician to identify a Head & Shoulders pattern, and he can quickly scan a few charts and find one. Ask him to mathematically define the same pattern, and he’ll struggle. He can tell you what the pattern looks like in general terms, but to nail him down on specifics will present obstacles. For example, what constitutes an uptrend that is required to precede the Head & Shoulders pattern? How tall are the shoulders compared to the head? How close in height do the left and right shoulders have to be? How long does it take for the pattern to develop? Etc. Etc. And here is the biggest challenge; how strict or loose are these qualifications once you’ve defined them? There has to be some slack in the rules or all but the most textbook patterns will be found.

To say that CPR is completely objective is actually a bit misleading. CPR simply applies John Murphy’s Pattern Recognition rules and John’s rules are based on classical pattern interpretation techniques. In a sense this makes the rules subjective. However, these rules become objective in that they are consistently applied each and every time. The human eye identifies a specific pattern as a Head & Shoulders one day and a Triple Top the next. This will never happen with CPR. CPR objectively and consistently applies the same rules every time.

Are the rules perfect? No. John Murphy himself is the first to admit that there is plenty of room for improvement. In fact, you could even say that many technicians do a better job at correctly identifying patterns than CPR. However, these same technicians can still benefit from CPR. They can use it to quickly screen thousands of charts for patterns. They can then apply their own expert eye to the identified patterns. Therefore, as said before, most technicians will benefit from the objectivity introduced in CPR, and could see dramatically improved trading results.

Installation

To install the CPR tools:

1. Insert the Program CD into your drive. The setup starts automatically.

Or if the auto-run feature of Windows isn’t enabled on your system, click the Start button and choose the Run command. Type “D:\SETUP.EXE” in the Open box and click the OK button.
(Note that “D” represents the letter assigned to your CD-ROM drive. If your drive is assigned a different letter, use it instead of “D”.)

2. Follow the on-screen instructions.

 

Forex Signal 30 is the best forex system since 2009 and has been used by thousands of traders from around the world to generate profit in forex trading. This system is created by our team of Brilliant Forex Signal Team, this system is made as simple as possible for beginner and professional traders.