Has anyone studied the % of time the market follows the previous day's trend vs. retraces from the previous day's trend? Many claim that the market ranges more than it trends; however, this is a different question. For example, the eurusd could go down 500 pips this week and then go up 550 pips next week. The record would show that the eurusd did not have a trend over the coarse of two weeks. However, in those 10 days the eurusd may have experienced 5 occurences where the following day had the same direction of the prior day and 4 occurences where the following day had the opposite direction of the prior day. Or perhaps the ratio was 7:2, or 2:7 for trend:reversal.

I believe the incidents of follow-through trend vs. reversal is about 50%:50% (or close to it). Applying this probability to risk mgmt (i.e. risk/reward ratio) & money mgmt (i.e. trailing stop with x% of lot size) may give the edge one needs to be very successful at forex trading.

Any thoughts...

thanks,

Walt

I believe the incidents of follow-through trend vs. reversal is about 50%:50% (or close to it). Applying this probability to risk mgmt (i.e. risk/reward ratio) & money mgmt (i.e. trailing stop with x% of lot size) may give the edge one needs to be very successful at forex trading.

Any thoughts...

thanks,

Walt