2024/10/09 by Inga Ivanova, Ivanova, Inga, Grzegorz Rzadkowski +3
Social Sciences · #35 #44 #93 #94 #Computers and Society (cs.CY) #Cultural, Linguistic, Economic Studies #FOS: Computer and information sciences #H.1 #J.4 #K.4
paper · pdf · doi:10.48550/arxiv.2410.06476
openalex publication_date 2024/10/09 · openalex created_date 2025/10/10 · openalex updated_date 2026/07/28
The paper focuses on the link between information, investors' expectations and market price movement. EUR/USD market is examined from communication-theoretical perspective on the dynamics of information and meaning. We build upon the quantitative theory of meaning as a complement to the quantitative theory of information. Different groups of investors entertain different criteria to process information, so that the same information can be supplied with different meanings. Meanings shape investors' expectations which are revealed in market asset price movement. This dynamics can be captured by non-linear evolutionary equation. We use a computationally efficient technique of logistic Continuous Wavelet Transformation (CWT) to analyze EUR/USD market. The results reveal the latent EUR/USD trend structure which coincides with the model predicted time series indicating that proposed model can adequately describe some patterns of investors' behavior. Proposed methodology can be used to better understand and forecast future market assets' price movement.