80% of the time
- Thread starter fordewind
- Start date
There is always a timeframe in which the market is trending. Whether it is a good timeframe to trade in, is another question.
So the market is ALWAYS trending.
And it is ALWAYS ranging in some TF. However, if you pick one or two TF close to each other in time then 65% to 70% of the time it will be in a range, of some sort, in that particular TF. There are exceptions. Such as relentless periods of trend. Intraday you can have days where the trend is grinding up or down all day. But, on average, markets range more than they trend in any one TF.
Last edited:
If you want to make your life difficult, that's the way to go. If you are masochistic, take the ranging road.
I prefer the trending road as trends always make more money and the risk/reward ratio is better. Much less stress too.
One and the same, one needs a lot of small profits to pay for the big loss that trended against him. The other needs a big trend to pay for all the stops they weren't really planning on getting hit. So in the end one needs a long chop and the other needs a strong one way trend. I've traded both. The risk/reward is interesting. Mirror images of each other, but my definition of risk and reward has changed.
My definition has remained the same, but it's turned out that the ratio that's most profitable for me, within my acceptable foreseeable drawdown parameters, has changed.
That's the general accepted way of thinking.
But I have many big profits and few small losses in trend trading. So the best of both worlds. It was never my intention to get that way, but years of studying and trying new things lead to these characteristic that are different from what most people think about trend trading.
So the usual arguments for and against trend trading are not valid for me.
I have a higher % of winning trades then losing trades. And the winning trades generate per trade much more profit then the average loss per losing trade.
Ranges, if wide enough, offer both long and shorting opportunities so a trader can make $ both ways. In addition, b.o. from ranges fail 70% to 80% of the time so that is good odds for fading b.o.'s in ranges. And if they are wide enough RR can be decent. And since markets range more than the trend a trader gets more opportunities. Has nothing to do with being masochistic but has to do with knowing how to trade ranges by correct reading of PA bars in the ranges as they are developing. That said, trends as well are good trading so nothing wrong with focusing on trends. Likewise, focusing on ranges. Or both. Just trade what the market offers. Or stick with one or the other. Everyone has their style.
I agree.
Each person should find his optimal situation based on the specific behavior of his trading system and his personality.