How you trade without trying to predict/forecast which way the trend will move after?

[Hoggums]

Jumping on a trend is a perfectly valid trading strat which I use myself. However it doesn't matter how you justify what the percieved odds of the success of the trade is. Whether it's gut feel, statistical analysis or a mathematical analysis such as an indicator - you are still anticipating/predicting the future direction of the instrument you are trading.

Trends are only identifiable after they have formed and then end of a trend is only apparent when a new one has formed. You enter a trade between the actual end of the trend and the point the new trend becomes apparent you will get stopped out.

 

[black bear]

I just agree

This is silly. As a speculator, any time you get long any instrument for any reason you are predicting an up move. Any time you get short in any instrument for any reason you are predicting a down move. Period. People who tell you different are trying to fool you, themselves or both.

jj

sounds correct to me

whats the problem

thats all trading is ............


you buy something because you think its cheap = you think you will be able to sell it to someone else at a profit later whatever your timeframe, method or anything else or vice versa for short

You decide if your wrong or right, best being wrong pretty dam quick imho, so be selective = your timeframe you trade in, stepping out to make it right =

two wrongs do not make a right, they do at trading all to often and that leads to bad habbits imho that are all to easy to overlook

= usually a little right and a big wrong in the end, its a form of double up against yourself get caught and ........



Trend = cheap expensive cheap expensive over and over again, join in where you like no why and where you hope to go, can be based on higher tf or just the one your looking at contra or otherwise get out if price goes some place it should not based on Why your in, stay in while he"s your friend.



have Fun

good Easter all :clover:

Andy

 

[black bear]

I just love to see the lower tf trend strong right up to BIG R in a higher tf

 

[FXSCALPER2]

It depends on where the prediction lies, of course.

Imagine a trading system where you win only 30% of the time but your reward is much bigger than your risk. You can predict, based on your calculations, that you will make money over time. In this case, you are predicting your equity curve over time, if you like.

Spanish's question is about predicting price direction. Taking the same 30% hit system, there is no sense in which you are predicting that the price would go up when you put on a given trade. In fact, if you are forced to predict what the price would do after you enter long, for example, you will have to say it will go down because there is a 70% chance over all that you will be right on your prediction.

It is therefore not necessary that you can predict where the price would go when you put on a trade. This is true of, for example, a system where you chances of winning on a trade are 50:50 where the reward is slightly bigger than the risk.

 

[black bear]

agree FX but never liked the 30% bit much prefer much higher SR and run the odd one thats good to me

if its a weakness well I have learnt to live with it and do ok and no drawdown which I think is important because it represents total resources if your trading a reasonable size account and you are relative new to trading

I think there are many who prefer it your way round I prefer a little and often and a odd good one

just me I guess

30% SR =10% chance of 7 losers in a row 5% chance of 9 losers in a row and a 1 % chance of 13 in a row

2 bad runs pretty close together and :-( imho

latter

all the best

 

[Mathemagician]

Spanish's question is about predicting price direction. Taking the same 30% hit system, there is no sense in which you are predicting that the price would go up when you put on a given trade.

You are predicting that, on average, price will be higher at your exits than your entries.

jj

 

[Hoggums]

Problem is the argument of trading the opposite way doesn't always work either. Let's say you have a 20pip limit and 10 pip stop.

You buy - the price goes up 15 pips and then drops 50 pips - you get stopped out -10 pips
You sell - the price goes up 15 pips - you get stopped out -10 pips (again).

 

[Trader333]

You buy - the price goes up 15 pips and then drops 50 pips - you get stopped out -10 pips
You sell - the price goes up 15 pips - you get stopped out -10 pips (again).

You could move your stop to BE before the retrace


Paul

 

[Rhody Trader]

Um apart from well basically just trading minutes before major new releases and hoping for extreme jumps or falls in the market, what other ways are there??
(Im not being sarcastic im just very curious).


Because everywhere i have read that you need to always make sure you are trading with the trend..

But at the end of the all 'the trend' is, is the direction that the market ''is and will be in the future'' moving in.
But so if you do not look at the graph and forecast which direction you think the trend will go,
and you cannot 'trade in the past' of what the market has already done, then how do you decide whether you are going to buy or sell?

(Since all 'a trade' is simply 'a bet' in 1 of the 2 directions of which you will think the market will move).

As others have indicated, trend trading is by no means the only approach. Nor is trading with the trend an absolute rule. Nothing in trading is.

There are so many different ways to trade the markets - stuff you would never think about if you didn't get exposed to it. Some traders have absolutely nothing to do with direction. They just play volatility or yield spreads or mispricings, among other things. Don't make the mistake of assuming that everyone approaches the market in the same way.

 

[Rhody Trader]

And these are people who say they do trade the trend though...
They say the trade the trend, holiding longterm positions of currencies (EUR/USD).

If they are trend traders, then while they my not explicitly forecast price movement, the fact that they are taking a position is an implicit expecation of prices continuing a trend. To FXScalper's earlier point, a low win rate system would seem to contradict the idea of having a forecast. It's just that the forecast is about outcome over a large number of trades, rather than just the current.

 

[RedGreenBen]

sorry RGB, i dont mis- behave myself usually - - its just get when you get some people with " matter of factly " attitudes it winds me up -

<SNIP>

The whole KEY to this business, is to train your brain to remain EMOTIONLESS - !!

dont focus on the money - focus on the CHARTS.......... !!

Fair point, and I don't disagree with anything you said. In the same way I may have over-reacted (where is that <I'm not being arsey just trying to make a strong, clear point> font when you need it??)

Personally I blame Spanish89 for starting these controversial threads

 

[RedGreenBen]

and drop the condescending attitude, at least until you can get the basic terminology correct.

That is the best laugh I have had in ages (although it may take you a few minutes to understand why.

 

[0007]

Sharky - Wot about this then ?

where is that <I'm not being arsey just trying to make a strong, clear point> font when you need it??)

That's a VG idea ! - especially a smilie

 

[Mathemagician]

That is the best laugh I have had in ages (although it may take you a few minutes to understand why.

I googled it and finally understand! Sorry for being overly snippy there. During the trading day I sometimes don't take the time to be as polite as I should.

jj

 

[fibonelli]

Why do we make trading so difficult?

Why anticipate a trend resuming when you can simply patiently wait for sufficient evidence, from the actions of eg "big money" trend traders, on the price chart to confirm that there is a high probability of the trend resuming from defined support/resistance zones in an uptrend/downtrend.

 

[Devilicus]

google what? I dont get it

 

[0007]

Why do we make trading so difficult?

Why anticipate a trend resuming when you can simply patiently wait for sufficient evidence, from the actions of eg "big money" trend traders, on the price chart to confirm that there is a high probability of the trend resuming from defined support/resistance zones in an uptrend/downtrend.

Agree. Simplicity is the key. When you see a bandwagon passing - jump aboard. When the going gets rough, jump ship. Less is more.

 

[shadowninja]

And that is the crux. Remember that Spanish89 is new to trading so we should bear this in mind. I think trend trading over a number of days is the easiest method for newbies like Spanish89 and myself.

Note: my status of Legendary Member is probably a reference to how good I am at using my legs to defend myself.

 

[spanish89]

Personally I blame Spanish89 for starting these controversial threads

What you mean you blame me for starting all the controversial threads???! LOOOL :cheesy::cheesy:


I just like to get abit of life, debating and banter pumping around the old forums.. Lol



The reply i was most looking for was Shadow's reponse, as he is the trader who's view my question and this entrie discussion was actually based around..