Consider a point in a chart when a pattern is forming. If the patterns forms it seems like there is a kind of determinism which produced the pattern. If the pattern does not form, then it can be seen that the pattern was just another pattern which did not happen. What is a correct representation of this. Is it the case that that there is a structuring to the market which results in patterns forming or not forming. Meaning, there is really not an alternative route for patterns formation or dissolution at a given point, there is just one route.
The fact is that there is a number of different routes which can be taken at a given point, or set of points. And it is a feature of trading that this is borne out, simply given that expected apparent patterns do not form and that directions reverse. However the idea of a ball moving within its container tracing out a pattern, as it reacts to market inputs is compelling. It gets structured by events, which are reinforced by trader and computer action, sustaining repeated patters and regularities.
However a counter example to this picture is news trading. For here it can be seen that the market in the raw likes to do very unpredictable things. This snapshot of the way the market moves to liquidity, can suggest that it rather does have the capacity to sustain possible outcomes, but this very capacity results in oscillations (with the occasional unpredictable structured response).
The frequency with which patterns do not play out in normal market conditions can be supportive of this sense of an underlying tendency to sustain possible outcomes, and express this as the random appearance of clear patterns - overall the picture is fractured and prone to oscillations, with order appearing as it pulls a pattern from the set of possible outcomes, as random conditions enable this (thus order from disorder, a point made in the site of this blog in its early days).
This sense of (in effect) pattern matching by the market when possible, is perhaps more like as it appears in the trading day, pattern matching repeated from random causes, creating regularities.
