Trend Trading Styles

"Certainly when you have a position with a profit. Anytime the market goes up a reasonable amount - say a strong day's work - after you've put on a position, it's probably worth adding to that position. I wouldn't want to wait for a retracement. That is everyone's favorite technique - to buy something strong that retraces. I don't see any justification in the statistics for that. When beans are at $8.00 and go to $9.00, if the choice is to buy them at $9.00 or buy them if they retrace to $8.80, I'd rather buy them at $9.00. They may never retrace to $8.80. Statistics would show that you make more money buying them and not waiting for a retracement."

Richard Dennis
 
As to which makes more sense, it depends on what you're trading and what stage you're in. It makes more sense, for example, to look for breakouts when coming off support than when nearing resistance.
 
For ES, I only trade retracements, and fade supp/resis which is the same thing sort of. Its a choppy market most of the time. Usually aim for 3 pts, but that varies.

For euro and ZN, I do both. When these markets break, especially the euro, they often just run.

Jay
 
"It doesn't matter how often you are right or wrong - it only matters how much you make when you are right, versus how much you lose when you are wrong."

George Soros
 
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