William Eckhardt: When I first began trading solely on the basis of price and was much more concerned than I should have been about the academic orthodoxy that futures market price change was pure white noise--a random walk--I made the following notebook entry: "How can the aggregate of traders and users arbitrage out a potentially unlimited number of nonlinear relationships?" The implication was that they could not. Twenty-five years later, I am less confident about the continuing correctness of this answer. What I failed to take into consideration was the staggering explosion in information processing. This will only continue. Eventually artificial intelligence devices, superior to any human researcher, will effectively uncover all exploitable nonlinear relationships of price to price. Such relationships will be mined until technical analysis is no longer profitable. There is an irony in that dogmatic" random walk" theorists, dead wrong for a century, will turn out to have been prescient--futures markets will have been driven to randomness. The process has already begun.

I feel these developments are nearly assured (assuming no disruption of civilization). What is less clear is whether this will happen as rapidly as I predict--in 10 to 20 years. In the meantime, profitable trading will only get harder as increasingly more astute traders pursue progressively weaker statistical regularities. This is why it is necessary for a CTA continually to improve just to hold his or her own. The only consolation I can offer is that there are profits to be made participating in this process of randomization.