ES Journal Archive (2006 - 2008)

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Quote from volente_00:

You will never short a top or buy a bottom being a trend trader. You will also be behind the curve when the trend changes because you are waiting for confirmation and miss the majority of the new trend. From a longer term time frame using your argument, one would never short the indices because the long term trend is up over the past 100 years.




:)
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This is with the typical trend trader---you are correct. However, larger positions can be taken with the trend than countertrend and the trend trader ends up reaping larger benefits. The countertrend trader is wrong more often as well, so that if they are using the same size as the trend trader, they get hurt worse. :)
 
Quote from volente_00:

You will never short a top or buy a bottom being a trend trader.

:)
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The best trading plays are when you jump right at the birth of a new trend.

This can be done without being a contrarian you just need confirmation.

For instance....

Say ES is on a strong downtrend.

It drops 20 points.

Forms a Double Bottom with a mid swing in between.

Makes a higher low, closes above the mid swing.

What is the trend ?

Did you catch the bottom ?

Pretty much, but you did so with confirmation and low risk and with the new immediate trend.

Anek
 
Quote from Buy1Sell2:

This is with the typical trend trader---you are correct. However, larger positions can be taken with the trend than countertrend and the trend trader ends up reaping larger benefits. The countertrend trader is wrong more often as well, so that if they are using the same size as the trend trader, they get hurt worse. :)
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But the countertrend trader uses much smaller stops and is able to take many more trades than the trend trader.
 
Quote from volente_00:

Not at first, Your first position went against you 20 points.
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Correct. The demonstration there was that by using no criteria except for "trend is up", I was able to walk away from the computer and all the market heat I had to take was about 19 points. This is a relatively small amount of heat to take in order to trade with the trend and go higher. This point I was making to dmartin about trading with the trend and it being hard to lose large sums of money. If your account was 900, you would have been wiped out, but trading with that small capital against a face value of over 75000 would be nuts. :)
 
Quote from Anekdoten:

The best trading plays are when you jump right at the birth of a new trend.

This can be done without being a contrarian you just need confirmation.

For instance....

Say ES is on a strong downtrend.

It drops 20 points.

Forms a Double Bottom with a mid swing in between.

Makes a higher low, closes above the mid swing.

What is the trend ?

Did you catch the bottom ?

Pretty much, but you did so with confirmation and low risk and with the new immediate trend.

Anek
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Problem is most climax tops or bottoms are V shape in the indices.
 
Quote from volente_00:

But the countertrend trader uses much smaller stops and is able to take many more trades than the trend trader.
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Sounds good, but the countertrend guy misses most of the good opportunites, while the trend trader has a much higher probability of an extended gain by trading less. :)
 
Quote from Buy1Sell2:

Correct. The demonstration there was that by using no criteria except for "trend is up", I was able to walk away from the computer and all the market heat I had to take was about 19 points. This is a relatively small amount of heat to take in order to trade with the trend and go higher. This point I was making to dmartin about trading with the trend and it being hard to lose large sums of money. If your account was 900, you would have been wiped out, but trading with that small capital against a face value of over 75000 would be nuts. :)
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That was this time, and if you had put on the same trade before we went 1550 to 1370 ?
 
Quote from volente_00:

Problem is most climax tops or bottoms are V shape in the indices.
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You mean like this ? (Pic Attached)

A solid understanding of reversal formations could be considered a form of confirmation.

Anek
 

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