Classical principle and crude oil trading -- butterfly effect
Financial markets are often traceable. A small event may lead to a big financial storm, and the crude oil trading market is no exception. Today, Xiaobian would like to share with you what is the butterfly effect? How does the butterfly stir up its small wings to trigger a storm?
What is the butterfly effect?
In the 1970s, Lorenz, an American meteorologist, explained the theory of air system that the occasional vibration of a butterfly wing in the Amazon rainforest might cause a tornado in Texas two weeks later.
This is the famous butterfly effect, which should be said that very small changes in the initial conditions will cause great differences in their future state after being amplified. Some small things can be confused. If some small things are amplified systematically, they are very important to an organization and a country, so we can't be confused.
Enlightenment:The very small change of initial conditions will cause great difference to its future state after being amplified.
Application:In the process of crude oil trading, investors should not underestimate the subtle fluctuations in the price, but find out the general direction from the small fluctuations.
The above is the butterfly effect that Xiaobian shares with you. Crude oil traders should learn to see the big with small ones and be cautious of sudden big market.