Bookies odds and support / resistance

[to75ne]

learn to trade first then when (if you do) then worry about nuances in the differences between fractional and decimal odds.

[StellaBot]

Here is an example bookies with 10% overound odds v betfair 5% commision odds
Maybe Shaun can now show the true support and resistance.


21 17.50
16 13.33
14 11.67
12 10.00
10 8.33
9 7.50
8.5 7.08
8 6.67
7.5 6.25
7 5.83
6.5 5.42
6 5.00

[ShaunWhite]

Devil's advocate incoming
Wouldn't that make it "current fair value"; not "support/resistance"?

What's the difference?
Isn't support/resistance just the limit of what people consider to be fair value?

[ruthlessimon]

In markets with higher liquidity and widely available TV coverage would you expect there to be a higher ratio of regular punters to traders, and therefore bookies odds would play a greater role?

That's a decent shout - & certainly testable. I'll have a quick look at this on the June shorties & post up the findings

[spreadbetting]

I'd be surprised if you find any reliable formula between bookies odds and betfair odds there are too many variables to go into and the bookies are more inclined to follow Betfair odds than the other way round so there's little point in worrying about them. A 5/1 shot at the bookies can happily trade at a steady 6 to 12 depending on the course. Bookies will generally bet to between 1-2% a runner but that overround isn't evenly spread when translated to exchange odds as their liabilities aren't spread the same.

[ruthlessimon]

What's the difference?
Isn't support/resistance just the limit of what people consider to be fair value?

This was the 15:50 - & I'd call 2.46 the resistance level, not 2.5. & interestingly the number 2.46 crops up a lot



Caveat: - You can't just assume price always returns to fair value, markets are simply way more complicated!

[ShaunWhite]

Maybe Shaun can now show the true support and resistance.

Or maybe he can't really be bothered

I was only going to have a quick look at the forum, I finished my week at about 6am this morning so it's not someting I want to get hugely involved in on a day off.

The OP asked a question, I gave him my opinion. If you agree then fine, if you don't, then fine. I don't really mind either way.

[Dallas]

I'd tend to view them more as 'Sticking' points until I see some decent traded volume build at them

[ShaunWhite]

What's the difference?
Isn't support/resistance just the limit of what people consider to be fair value?

This was the 15:50 - & I'd call 2.46 the resistance level, not 2.5. & interestingly the number 2.46 crops up a lot

If you're talking swings then I'd call that the abolute textbook example of 2.5 support. The slight noise is perfectly centered around peak vol at 2.5.

2.52-2.46 as a scalping range sup/res maybe, but in terms of swings, that's 2.5 all day long.

2.46? narrr that's just a few overexcited punters prepared to take a bit less than most people.

[ruthlessimon]

Or maybe he can't really be bothered

I finished my week at about 6am this morning so it's not someting I want to get hugely involved in on a day off.

Day off??

The market never sleeps!

[ShaunWhite]

I'd tend to view them more as 'Sticking' points until I see some decent traded volume build at them

+1
...not that anything Dallas says needs a +1 from me.

[Derek27]

I know some layers have a cognitive bias towards laying at 2.0 but not 2.02 but generally I think the traditional prices are transparent and largely ignored. Some young traders or traders without a betting background may only be used to decimal odds. I doubt 13/8, 15/8, 100/30 would have any significance whatsoever.

[ruthlessimon]

2.46? narrr that's just a few overexcited punters prepared to take a bit less than most people.

I just rewatched that market, & it came from 2.70 - went clean through 2.5 (albeit only 2 ticks through it ) - & consolidated on 2.5. Yes, the punters/traders arguably overreacted - but that's the definition of mean-reversion!

[ShaunWhite]

I know some layers have a cognitive bias towards laying at 2.0 but not 2.02 but generally I think the traditional prices are transparent and largely ignored. Some young traders or traders without a betting background may only be used to decimal odds. I doubt 13/8, 15/8, 100/30 would have any significance whatsoever.

Good, and while they're in the minority, we'll continue to profit from them continually overshooting where sense prevails. It why mature trading money gets stacked up speculatively just beyond these points as far as I can see.

Fair value has to be at 'round' numbers in the public psyche. Most can't pick a winner for trying usually, so who of them are clued up enough to say that a horse is a 53.26% chance rather than a 50/50 chance, especially en mass. You've only got to see the markets to know that even 'industry pros' only have a rough idea of a range of prices anyway.

I'd be sad if traditional odds went, but then maybe round numbers would become even more significant.

[ShaunWhite]

2.46? narrr that's just a few overexcited punters prepared to take a bit less than most people.

I just rewatched that market, & it came from 2.70 - went clean through 2.5 (albeit only 2 ticks through it ) - & consolidated on 2.5. Yes, the punters/traders arguably overreacted - but that's the definition of mean-reversion!

We have a totally different sense of scale :
2.75 -> 2.50 -> 2.60 = Mean reversion
2.75 -> 2.50 ->2.46 ->2.5 = Bottoming out
2.75 -> 2.50 ->2.54 ->2.5 = Dead cat bounce

2 ticks @ 2.5 is low for noise, let alone any conscious value taking.

These small overshoots are absolutely everywhere, especially in newsfeed based markets.