if you are trading reversals, you are trend following, because you are following a [new] trend from the start, rather than from the middle [pull back]
Contrarian Trader Tops And Bottom
- Thread starter nasir
- Start date
it is easy to say i will follow long term trend.
But there many many trends taking place at the same time,some in the opposite direction, so it is so easy to mistake some thing else, as 'your trend' and do something not appropriate.
This has happened to me, many, many, many, many, many times until i discovered, what was happening: in a big crowd, it is easy to lose your friend or mistake someone else, as your friend.
So experts say: follow the trend,beginners say aha so easy to make money.
The reality is a little different
But there many many trends taking place at the same time,some in the opposite direction, so it is so easy to mistake some thing else, as 'your trend' and do something not appropriate.
This has happened to me, many, many, many, many, many times until i discovered, what was happening: in a big crowd, it is easy to lose your friend or mistake someone else, as your friend.
So experts say: follow the trend,beginners say aha so easy to make money.
The reality is a little different
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experts say buy the dip......but not all dips should be used as entry.
the price action during the dip is critical is determining whether the pullback be traded.
if the pullback does not appropriate price action, and the market then resumes it's original trend, then, that resumption of trend, may be faded.
the price action during the dip is critical is determining whether the pullback be traded.
if the pullback does not appropriate price action, and the market then resumes it's original trend, then, that resumption of trend, may be faded.
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both trend followers and top seeker are trying to estimate the inherent strength of the market and acting on that estimation.
to say that one is better than the other is simply erroneous thinking.
Further more estimation of market strength may be done on any time frame so to say one time frame is plain noise is bordering on the absurd.
That is why a trend follower can fail miserably while a top seeker may excel
The reason for doing something is important
to say that one is better than the other is simply erroneous thinking.
Further more estimation of market strength may be done on any time frame so to say one time frame is plain noise is bordering on the absurd.
That is why a trend follower can fail miserably while a top seeker may excel
The reason for doing something is important
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as far as so called risk management is concerned once you know that the move is weakening, there is no point in a stop: many times the end is a whimper, the other time it is a bang, so where do you put the stop? you put it where you are wrong.
the reason of the trade, is weakening of the move, so you get out once the move strengthens against you. then you have to accept that it is no longer making sense.
what i am saying is that the stop must fit, must be coherent and jell with the trading plan or technique.
if you trade risk reward then the stop is critical.
if you are in a trading range environment then you need not put a stop, you can scale in......the nature of market is that it continues for some time in a trading range environment before the change comes.
if i scale in i usually keep taking profit and then i may again enter the again at the same level i entered before,if i get the chance.
the reason of the trade, is weakening of the move, so you get out once the move strengthens against you. then you have to accept that it is no longer making sense.
what i am saying is that the stop must fit, must be coherent and jell with the trading plan or technique.
if you trade risk reward then the stop is critical.
if you are in a trading range environment then you need not put a stop, you can scale in......the nature of market is that it continues for some time in a trading range environment before the change comes.
if i scale in i usually keep taking profit and then i may again enter the again at the same level i entered before,if i get the chance.
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when should you trade with the trend and when should you be fading continuation moves of the trend such as breakouts into highs and lows?
In India, in Hindi, we say "pehle aap" which means 'after you'.
in trend following and in fading trends, this is the key to success.After you!
Never trade countertrend unless there has been a show of strength by the counter trend traders
this means unless there is prior trend line break,do not look to go countertrend.
In the chart i have shown a trend line break and after that a breakout marked with a yellow arrow:that breakout should be bought or faded.
Do not complicate trading with systems indicators reading 1000 page books....
In India, in Hindi, we say "pehle aap" which means 'after you'.
in trend following and in fading trends, this is the key to success.After you!
Never trade countertrend unless there has been a show of strength by the counter trend traders
this means unless there is prior trend line break,do not look to go countertrend.
In the chart i have shown a trend line break and after that a breakout marked with a yellow arrow:that breakout should be bought or faded.
Do not complicate trading with systems indicators reading 1000 page books....
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when to book profit in the above example? when there is trend line [marked 2] break as shown in the below chart
nce there is trendline break it means there are sellers who have found the level good enough to sell. so if the market goes higher it becomes more attractive to sell.This is why entering on pullbacks, which is widely adviced, should be done with caution and only after considering how strong the pullback was.
nce there is trendline break it means there are sellers who have found the level good enough to sell. so if the market goes higher it becomes more attractive to sell.This is why entering on pullbacks, which is widely adviced, should be done with caution and only after considering how strong the pullback was.what happened after the second trend line break marked 2? see this chart.also in the chart is another buying opportunity with trend line and arrow marked.the market does this all day long in every time frame. the chart was in M1 does that look like noise?
Why read books on trader psychology, on wave theories,back testing ?
Why read books on trader psychology, on wave theories,back testing ?
and you will ask why is tradergod losing money? because i forgot all of the above and got distracted.
This has happened to me many times and i have been a profitable earlier but changed my technique and got lost.
This may sound absurd and would not have happened if i had kept a journal
This has happened to me many times and i have been a profitable earlier but changed my technique and got lost.
This may sound absurd and would not have happened if i had kept a journal
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