Have the patience to wait for a strong trend. It should be part of an entry criteria.
Every professional trader said market had changed dramatically over the years
- Thread starter TripleJs
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If markets are choppy they are choppy on both sides. That is why averaging down can work, if applied correctly. Think about it.
I thought about it and think it's too risky. If I'm wrong I lose too much.
"Choppy" simply means constricted range and calls for fading the edges rather than looking for retracements or trend termination (absolutely not for the inexperienced) given adequate range and reasonable risk/reward scenario. It is not an environment however for the beginner or journeyman. Trading is not that difficult but learning to trade is. Those who jump in unprepared will fail, those who have the inability to maintain appropriate disciplines will fail. I've been trading for 22 years and if market behavior has changed materially (which I doubt) it has been too slow a change to notice.
A professional trader is always tuning and working on optimizing his or her methodologies which can be time consuming and not always result in improvement but it's what we do and mostly enjoy the process.
A professional trader is always tuning and working on optimizing his or her methodologies which can be time consuming and not always result in improvement but it's what we do and mostly enjoy the process.
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What has changed is that the retail trader has a lot more information and better access to the market than they did years ago.
When I started trading you got your data from a day old newspaper, did you charting on a piece of graph paper and phoned your order to a broker. Commissions were 3% each side and the spreads were in 1/8ths and 1/4ths. No news, no CNBC, no internet.
Today you watch the price move on your charting program in real time, have a direct access broker, the spreads are in cents and you have access to the same info as everyone else.
The market still moves on supply and demand, fear and greed, human emotion, and TA that was developed years ago is still relevant today.
My trading has evolved over the years but it's because I learned from my mistakes. Had I started with the system I have now I wouldn't have had to change a thing.
It works. The stock/crypto markets are always creating all time highs. For that to happen it has to trend.
No, that doesn't prove trend following systems work. If anything, it means they underperform because you get whipsawed out of positions during corrections...you'd do better just holding.
It works. I use trend following and it works. Trend following is a broad term. Your method of trend following may not work but it doesn't mean other methods aren't successful.
Whipsaws happen but a good trend more than makes up for it.
You just do not understand trend following. Assuming things about trend following that are not true. I use trend following and found it the most effective way to trade. Hedge fund managers are among the top traders out there and all use trend following. Stop the bullshit about not beating the S&P 500 because hedge funds have to move hundreds of millions and nobody can including, you move that much monies in a short period of time and get exceptional returns. If you had to do the same, you would be happy with 18-20% a year. Does not disprove trend following works, because it does. Retail traders can move in an out of positions, and ride the trends multiple times. There are no rules that says, you have to wait 30 years to exit your trade. AMC I have traded 3 times and all profitable, just following the trend. Chances are good, I will continue to trade AMC using just the trends.
Oddly, you have identified the change: 30-year bull mkt. Organized exchanges have existed for a couple of hundred years, world-wide, and mankind have traded goods for a few hundred thousand years. It is only since the formation & prominence of Central Banks, esp the past few decades, that have created the illusion of stocks only going up.
It was Greenspan who turned the Country into a nation of day-traders. Benanke, Yellen, & the current idiot, printing so many dollars, to prevent huge drops in mkt averages. That is NOT the history for mankind's prior history.