General Probability Theory

Ruled line typology, ruled line index theory, ruled line numerical value theory, ruled line probability theory, risk aversion theory, and recovery theory are unique market analysis terms mainly used among Japanese speculators and traders. These concepts are particularly related to investment decisions made using ruled lines (charts) and are based on their own theoretical systems and empirical rules.

 

1. Ruled Line Typology

• Meaning: A method for predicting market trends based on patterns and formations that appear on charts (ruled lines).

• Background: Interpreting future movement based on candlestick shapes, arrangements, trend lines, triangle consolidations, inverse head and shoulders, etc.

• Similar concept: Chart pattern recognition in technical analysis.

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2. Ruled Line Index Theory

• Meaning: An approach that focuses on numerical indices or indicators found in charts to analyze the market.

• Example: Analysis using moving averages, RSI, MACD, and other technical indicators.

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3. Ruled Line Numerical Value Theory

• Meaning: A method that emphasizes specific price levels on the chart to identify market turning points or critical thresholds.

• Example: Concepts such as "Buy if the price exceeds this level" or "¥XXX is a support zone."

• Related: May include theories like Fibonacci sequences or Elliott Wave, which are based on numerical price structures.

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4. Ruled Line Probability Theory

• Meaning: A method that uses probabilities derived from chart patterns and historical behavior to guide trading decisions.

• Feature: Statistical reasoning such as "There is a 90% probability that the price will rise following this pattern."

• Modern connection: Related to machine learning and algorithmic trading.

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5. Risk Aversion Theory

• Meaning: A theory focusing on minimizing losses in trading through cautious decision-making.

• Content: Use of stop-losses, position sizing, hedging, and other protective measures.

• General: Risk-averse behavior is a core concept in economic and financial theory.

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6. Loss Recovery Theory

• Meaning: A concept concerning how to recover from losses incurred in trading.

• Sound recovery approach: Includes analyzing the cause of the loss, creating a re-entry plan, and revising fund management strategies.

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