"The price is right", it reflects all information.
Here's a challenge, from John Burbank, founder of hedge fund Passport Capital. He says:
"Price is all the information that exists in the market...it's just what people think....price means nothing other than the equilibrium of liquidity...It doesn't mean it's good or bad, it's just where people agree."
- Burbank is saying price just reflect available information
- The agreed upon price could actually be wrong
- Prices could actually be compromised of irrational agreements
That 'price means nothing other than the equilibrium of liquidity' is an intriguing point (at least to me). For those that regularly join me for the early Monday mornings and the often crazy price swings we see, it might make some sense too.
What say the traders of ForexLive?
Update: If you don't believe in technical analysis. Then look at what the chart posted above did next. Ok, I'll tell you: It hit 1.58 within six weeks.