Trend Following for Idiots (Order Restored)

S

steve46

I like to help and ET is inhabited by people who could benefit from a simple approach to this subject..

Since some here are so obviously handicapped when it comes to complex subject matter I have decided to take a more direct approach..

First an example of trend so simple, so direct that an idiot could comprehend it..

On this monthly chart using candles, you can see how a market trends on a long term basis..

Notice a couple of things about this chart as follows

First, The time frame...The chart shows price action from late 2000-early 2001 to the present.

Second, you can see a short term MA, and a longer term MA are in place.

Third, you can see how price acts during a trending move as it tests specific price points, pulls back and resumes its trending process. This is part of what professionals call "drift"

Now, even though some of you are "idiots", I believe you are still capable of learning (if you choose) and profiting from what you learn (if you choose).

Good luck,
Steve
 

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Since I cannot count on people to ask intelligent questions, I will do it myself..

Well Steve, if "trend" really exists, how do you define it and how do you profit from it?

Okay then, first, trend is any sustained directional movement. The magnitude of a trend is defined by the trader. For instance. For a scalper a trend could be as small a directional movement as two (2) ticks. For an intraday trader, a trend might be from two (2) ticks to whatever the average intraday range is for the tradeable instrument. For a longer term trader (or investor), who might use a monthly chart, trend might be defined as longer than the intraday range and up to several years or even decades. These are operational definitions that that I will use for the purpose of this thread.

Okay then, but how does one profit from trend...?

I'm glad you asked, however our time is up for the evening and so we will have to resume our discussion tomorrow..

Good night

Steve
 
Quote from bigbadbaz:

The brainless leading the blind
More...

ah yes, the "idiots" are finally arriving as planned....So good to see you, come right in...we've been expecting you...:)
 
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