Thomas
@aviationdoctor.eth
1090 Following
63553 Followers
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Crypto markets are nonlinear systems and TA is astrology for grown adults.
“Why do investors insist on the existence of cycles in gold and silver prices? Because periodicity is the most complicated orderly behavior they can imagine. When they see a complicated pattern of prices, they look for some periodicity wrapped in a little random noise” (James Gleick in Chaos, 1987).
Markets are nonlinear because small news (e.g., a Musk tweet) create large swings, when large news (e.g., a regulatory approval) may cause small swings. Nonlinear systems are not only sensitive to small influences (the butterfly effect), they can also be resilient to large influences (the raging bull effect).
They’re also nonlinear because shallow market depth, liquidity fragmentation, and feedback loops cause nonlinear amplification, as is the case when shorts get liquidated in cascades.
Crypto markets are also aperiodic, even after accounting for BTC’s four-year halving cycles. Their volatility is also highly autocorrelated. Any chart repetition is coincidental and transient at best.
There’s even evidence for strange attractors and fractal geometry in price trajectories.
That’s not to say that crypto markets are random — they are deterministic yet largely unpredictable, as all chaotic systems are.
Bullish on fundamentals, unfazed by transient noise 4 replies
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Telegram absolutely does encrypt though? “Secret chats” are privately E2EE, and “Default chats” are encrypted in both transit and cloud storage, however in this latter case Telegram (the company) holds the keys, which made it trivial for governments to pressure Durov (see https://farcaster.xyz/aviationdoctor.eth/0x72d3fff5) into giving them up.
Here, the only difference is that Signal won’t hold the backup keys, but if either party in the conversation gets their backup key broken into (poor opsec, coercion, border intercept, etc), then the whole chain of convo from the very beginning is accessible, instead of just forward secrecy being at risk.
It’s again an erosion of confidentiality for the sake of user convenience and adoption — similar mistake Durov made 0 reply
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