A prisoner’s dilemma is a situation where individual decision makers always have an incentive to make choices in a way that results in a less than optimal outcome for individuals as a group.
Prisoner’s dilemmas arise in many aspects of economics.
In the classic Prisoner’s Dilemma, people benefit most if they betray the group rather than cooperate.
If the games are repeated, each player can develop a strategy that encourages cooperation.
People have developed a variety of methods to overcome the prisoner’s dilemma in order to select the best collective outcomes despite apparently adverse individual incentives.
The Accumulation/Distribution Line (A/D) measures the supply and demand of an asset or security by looking at where price closed in a period range and then multiplying that by volume.
A bull trap means a reversal that forces market participants who are on the wrong side of the price movement to close positions with unexpected losses.
A bullish engulfing pattern is a candlestick pattern that forms when a small black candlestick the next day is followed by a large white candlestick whose body completely overlaps or engulfs the body of the previous day’s candlestick.
Capitulation occurs when a significant proportion of investors give in to fear and sell within a short period of time, resulting in a sharp drop in the price of a security or market against a backdrop of high trading volume.
Consolidation is a technical analysis term used to describe the price movement of a stock within a given range of support and resistance over a period of time.
The Directional Movement Index (DMI) is a technical indicator that measures both the strength and direction of price movement and is designed to reduce false signals.