Contrarian trading

[Aisone]

Is anyone else a 'contrarian' trader, ie trying to pick reversal points before or at the point they happen? I always see mentioning of trends but have never been comfortable looking for them and riding out something that is already well off it's reversal points, But I've rarely seen discussion from those who try to time and catch dropping knives or shorting soaring rockets (less of my thing.)

If you consider yourself a contrarian trader, what types of tools do you use for your timing, and what type of time frames or hold times are you most comfortable with? Do you use stops or tend to increase position at certain points if/when it goes against you? (To me it seems almost impossible to use tight stops in this type of trading, albeit I can definitely use them at times.)

Have to say it would be nice to have a partner(s) in crime with likemindedness to share analytics, or even a chat group trading ES focusing on or open to traders looking to take the road less traveled. Been doing this for a very long time but ironically the mental has gotten even tougher over the years (perhaps seen too many horrors/have too much trading-related ptsd LOL.)

 

[expiated]

If you consider yourself a contrarian trader, what types of tools do you use for your timing, and what type of time frames or hold times are you most comfortable with? Do you use stops or tend to increase position at certain points if/when it goes against you?

It's impossible for me to think of myself as a contrarian trader (in general or overall) because when I'm identifying possible reversal points before they happen, it's almost always in the context of some longer trend...

I would NEVER increase my position at certain points if/when price moved against me because such an event would be an indication that my premise was totally incorrect or my interpretation of events was seriously flawed. Rather, I would cut my losses as soon as possible and re-evaluate what's really going on so I could make a better trade next time, if or when that opportunity presented itself.

The above chart is actually that of a foreign currency pair, and I don't really do any position trading. Moreover, when I DO trade U.S. indices, it is only in the form day trading index derivatives, looking to get in and out quickly via 20-minute binary options.

 

[Aisone]

It's impossible for me to think of myself as a contrarian trader (in general or overall) because when I'm identifying possible reversal points before they happen, it's almost always in the context of some longer trend...

View attachment 332330

I would NEVER increase my position at certain points if/when price moved against me because such an event would be an indication that my premise was totally incorrect or my interpretation of events was seriously flawed. Rather, I would cut my losses as soon as possible and re-evaluate what's really going on so I could make a better trade next time, if or when that opportunity presented itself.

The above chart is actually that of a foreign currency pair, and I don't really do any position trading. Moreover, when I DO trade U.S. indices, it is only in the form day trading index derivatives, looking to get in and out quickly via 20-minute binary options.

Looks like a good entry system. Increasing adverse positions isn't always a preference and certainly isn't a rule, but many times I absolutely am happy to see prices to get more favorable in order to take advantage of scaling down before closing a position out. Those followup add-on trades are usually going to be the more rewarding ones. More risk is more risky though, and every situation is different, and adding to an adverse position has to be done with prudence and justification.

 

[wxytrader]

It's impossible for me to think of myself as a contrarian trader (in general or overall) because when I'm identifying possible reversal points before they happen, it's almost always in the context of some longer trend...

View attachment 332330

I would NEVER increase my position at certain points if/when price moved against me because such an event would be an indication that my premise was totally incorrect or my interpretation of events was seriously flawed. Rather, I would cut my losses as soon as possible and re-evaluate what's really going on so I could make a better trade next time...

Not me I'm stubborn. I never sell...just average down until I run out of money. You should be within striking distance of the bottom or shouldn't be buying at all. I once held a twitter position under water huge for a year before paying off a second mortgage with the returns during a buy out rumour.

Stop losses = Toyota
Average down = Lambo
(Just avoid bks lol...best to stay with indexes)

 

[maxinger]

Simplified explanation on 23 Jan 2024 Crude oil futures
on how

trend continuation & reversal trader trade vs
C trader, the Contrarian trader

A Contrarian trader has to trade a thousand times before he
has a successful trade.
But he has to top up his trading account continuously.

Contrarian trader aka

kamikaze trader
counter-trend trader
against-the-herd / against-the-grain trader

 

[Aisone]

Not me I'm stubborn. I never sell...just average down until I run out of money. You should be within striking distance of the bottom or shouldn't be buying at all. I once held a twitter position under water huge for a year before paying off a second mortgage with the returns during a buy out rumour.

Stop losses = Toyota
Average down = Lambo
(Just avoid bks lol...best to stay with indexes)

I can't say I've had an iron stomach like THAT but totally agree with the toyota/lambo analogy. Averaging down is how I learned to trade and it just makes sense. But numerous times in past years I've jumped into crashing stocks before knowing the breaking news, and that's a no-no. That said, I'm not always a great example either, as my ability to stomach adversity overall just isn't what it used to be.

 

[Aisone]

View attachment 332351


Simplified explanation on 23 Jan 2024 Crude oil futures
on how

trend continuation & reversal trader trade vs
C trader, the Contrarian trader

A Contrarian trader has to trade a thousand times before he
has a successful trade.
But he has to top up his trading account continuously.

Contrarian trader aka

kamikaze trader
counter-trend trader
against-the-herd / against-the-grain trader

I'm thinking a contrarian trader should be right as often as a trend trader or it's probably not a good system of predicting reversals. It can be a very complicated science, and I'm not sure your chart's criteria reflects that.

 

[SunTrader]

 

[Aisone]

View attachment 332356

My money's on 13.

 

[murray t turtle]

I'm thinking a contrarian trader should be right as often as a trend trader or it's probably not a good system of predicting reversals. It can be a very complicated science, and I'm not sure your chart's criteria reflects that.

%%
Better do better sometimes ;
or counter\trend it smaller,could have a prayer.
For some forecasting anyway not prediction.....