Will Sensex hit 21000 before Diwali?

I saw a news item in a newspaper website speculating that the Sensex will cross 21000 prior to Diwali. As per my calculations the chance is not that bright. It is only about 9%.

Here is the probability distribution of the value of Sensex on the pre-Diwali day:

Less than 19000 - 5%

Between 19000 to 19500 - 14%

Between 19500 - 20000 - 28%

Between 20000 - 20500 - 26%

Between 20500 - 21000 - 18%

Above 21000 - 9%

Happy Diwali!

Octopus Paul - Psychic Forecaster

It is amazing to see how chance can fool us!!! Look at the worldwide craze about octopus Paul. The eight legged creature got six successive predictions about Germany's games correct and is being heralded as a "psychic forecaster". Nobody (especially the journalists) seems to be asking the simple question - How often will that happen just at random? The answer is also easy to compute. The Octopus's prediction can be thought of as a string of heads and tails obtained from tosses of a fair coin. The probability that the string generated by the octopus matches the actual string is

= (1/ 2^6)= 1/64 = 0.015. That is the chance is about 1.5%. What we have seen is an occurrence of a low probability event and we are immediately driven to see a pattern!!! Fooled by Randomness!