One of the Best Trading Tips I ever Got

That is not a realistic analysis, if that held true (and I do it debate the merit of this particular claim) then only the next data point can be predicted with an edge. That is not what trading strategies aim at, predicting only the next data point, after all you don't look for holding periods of seconds. Higher highs and lower lows hardly predict with any edge whether a trend continues for another 50 or 100 basis points or even just 20 basis points to overcome the cost of execution.

tomorton said:
In practice this is just not true. Once price has established a trend, the least likely thing it will do next is reverse. That behaviour alone provides an edge.

Of course, price in a trend doesn't just continue in a straight line, but some form of continuation is the most probable early outcome at any specific point selected within the trend.
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GRULSTMRNN said:
That is not a realistic analysis, if that held true (and I do it debate the merit of this particular claim) then only the next data point can be predicted with an edge. That is not what trading strategies aim at, predicting only the next data point, after all you don't look for holding periods of seconds. Higher highs and lower lows hardly predict with any edge whether a trend continues for another 50 or 100 basis points or even just 20 basis points to overcome the cost of execution.
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But it is, you look for a uptrend, you look for a higher low ie consolidation, you go long with a SL under the area enough to weather a spike reverse and you aim to make more than your SL but a good factor.

Then you wait for consolidation to exit, then as uptrend a higher low to form and repeat.

There is no way to know / predict when a trend will stop, that's why you have the SL if wrong, lower low will form and your out with a minimal loss.

Give up on Prediction, just go with the flow.
 
GRULSTMRNN said:
That is not a realistic analysis, if that held true (and I do it debate the merit of this particular claim) then only the next data point can be predicted with an edge. That is not what trading strategies aim at, predicting only the next data point, after all you don't look for holding periods of seconds. Higher highs and lower lows hardly predict with any edge whether a trend continues for another 50 or 100 basis points or even just 20 basis points to overcome the cost of execution.
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There is indeed no way to know whether a trend will last for 20pts or another 200. Which seems an odd reason to not be in that trend.

I only trade off the daily charts but the principles are transferrable. Once an uptrend is established, I want to enter long following a resumption of upward price movement after a weak daily bar (e.g. a bar with a lower high and lower low, or at least a lower close). If Tuesday is a lower bar, I don't say Wednesday will be higher. But what I do say is that if price resumes its upward movement through Wednesday's high, then probably in a week's time price will be higher than it was this week.

I'm not a fanatic about this. My entries are all via pre-set orders. So my trade only opens if price does indeed resume its upward movement. If it doesn't, hey ho, maybe the trend has expired, so I don't get the long trade, nothing lost.
 
What you described is 100% prediction. You are predicting the trend continues. There are very few situations where trends last for a longer period of times. Almost all those drivers are shifts in fundamentals. Past prices alone have zero predictive power over future trend continuations. All I am saying is that you got the catalysts and drivers upside down.

Turveyd said:
But it is, you look for a uptrend, you look for a higher low ie consolidation, you go long with a SL under the area enough to weather a spike reverse and you aim to make more than your SL but a good factor.

Then you wait for consolidation to exit, then as uptrend a higher low to form and repeat.

There is no way to know / predict when a trend will stop, that's why you have the SL if wrong, lower low will form and your out with a minimal loss.

Give up on Prediction, just go with the flow.
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GRULSTMRNN said:
What you described is 100% prediction. You are predicting the trend continues. There are very few situations where trends last for a longer period of times. Almost all those drivers are shifts in fundamentals. Past prices alone have zero predictive power over future trend continuations. All I am saying is that you got the catalysts and drivers upside down.
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Disagree, odds are pretty good that it’ll continue 60/40 maybe, i do this via M1 very very fast, generally you’ll get 2 or 3 higher lows before retail have enough confidence to jump in, then retail cry omg why does it always fail when I enter.

You’ve got to hold for a higher high to make R:R worth while mind.
 
GRULSTMRNN said:
From poker you should clearly know that there is no such concept as a "streak". When you are dealt strong hands then this has nothing to do with a streak but it is caused by randomness. If you believe otherwise then that simply means you are superstitious, nothing else.

There are cases when trend continuations can be quantified and can be statistically proven, however, in most cases trend continuations are as random as a break of trend. Higher highs and lower lows have generally zero bearing on whether a trend continues or not if there was ever one in the first place. Again, I am stressing that there are exceptions and the edge is finding those exceptions. Most of the time this is not the case.
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From this post sir, I know you are a professional and know what you are doing.

Trading is really a probability game, we started with a method to select our trade, the outcome is rule by probability. Unless we discover special circumstances like a one time event (e.g. The Big Short), most of the trades will follow the probabilistic outcome and it is difficult to "bet" different lot size each time.

I believe @bone is correct, statistically a chart with higher high and higher low has a positive expectancy.
 
Times said:
Assuming that is all to it, this is pretty much speculation. Just because something made lower lows or higher highs doesn't mean that will continue.

Not saying you can't make money speculating but just not my cup of tea. Best of luck, I think its required with a strategy like this.

However the idea of KISS is truly great, Rise above the noise.
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%%
TRUE, Times;
but he made a good practical profitable point=higher highs, higher lows +higher closes most likely goes on.[Source ; profits +200+ year US Stock Uptrends]
Luck =small sample
Thanks:cool::cool:,:cool::cool::cool::cool::cool::cool:
 
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