What is Momentum trading?
- Thread starter TraDaToR
- Start date
Quote from bighog:
You must be ahead of the competition.
To catch "RUNS" you must be proactive instead of being reactive.
To become proactive you first must anticipate the "RUN" from your own set of clues, signals, intuition, brain pings, etc derived from experience and after a few years of your eyeballs looking like the red eyed ones on top of your puter with the springs. .
Becoming reactive requires you to wait until price (screw volume, that follows) has already made it's move (breakout, continuation) to capture your attention. Being reactive is WRONG, WRONG, WRONG. (did i mention chasing price is wrong? )
You are CHASING only after the fact. In that situation you failed to develope the aforementioned clues, signals etc to develope the necessary skillset to be ahead of the price breakout. In other words you failed to "ANTICIPATE". (when you chase price you are not pre-planing what the other players will do when price gets their attention.)
Think back about the "ACE" pilpts example of the ace pilot straps the fighter plane (WWll) to his body and flies ahead of his plane. Regular non-ace pilots strapped themself INTO the fighter and never flew ahead of their plane, always behind.
As a trader are you a regular, or are you "ACE" trader?
It is important to your mind that you are in control of the contest> when the contest controls you, game over dude. Ace pilots got the girls
Excellent description.
Happening right now probably into close. CFC bails out the market...lol. Don't forget to sell into the spike...
LMFAO Britney getting a margin call... Thats the straw that broke the camels back
Quote from CFerret:
Momentum trading is jumping on a move like one which just have happened in NQ and taking 10 handles in several minutes while risking just 2.
Hope you aren't serious. There is no free lunch. On average, the tighter your stop, the more you get stopped out.
People who sit and calculate their risk:reward before the trade, as if that had much to do with real market action are sitting in a delusional world.
That's true, RRR is just a theory...one of those things that give you warm fuzzies before you pull the trigger....but in reality, especially if you trade momentum, they don't really make a huge difference in what you're gonna do. Momentum trading is about riding the wave, not following diagrams.
Damn rcanfiel you normally piss me off, but between this and the Benevolent Ruler post...you ain't so bad. ha ha
IN terms of CF and Bighog. When one trades BO out of patterns, one doesnt know before hand how far the move is going to go(at least in my experience). Its best to understand price levels and know where traders like to take their profits.
I think a combination of exitig some on the Price level and then letting the rest ride for the trend is a good way to handle this problem.
I think a combination of exitig some on the Price level and then letting the rest ride for the trend is a good way to handle this problem.