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What does it mean to trade with the trend - Define trend? 47 replies

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How do you define a trend?

  • #1
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  • First Post: Nov 16, 2009 10:27am Nov 16, 2009 10:27am
I am trying to make an indicator that tells if there is a trend or not. The indicator should check many different currency pairs on many different time frames and find the currency pair with the strongest trend. The problem I have is that I don't know how to define a trend. How do you decide if there is a trend or not?
If slaughterhouses had glass walls, everyone would be a vegetarian!
  • #2
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  • Nov 16, 2009 10:45am Nov 16, 2009 10:45am
Quoting Gambler180
I am trying to make an indicator that tells if there is a trend or not. The indicator should check many different currency pairs on many different time frames and find the currency pair with the strongest trend. The problem I have is that I don't know how to define a trend. How do you decide if there is a trend or not?
Zoom out.
Gone to a better place
  • #3
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  • Nov 16, 2009 11:12am Nov 16, 2009 11:12am
Quoting smikester
Zoom out.
That answer didn't help me. I need to know how to define a trend using mql4. I have made a little indicator that makes an alert if the difference between the price now and the price 30 bars ago is more than 3 times ATR 30. It works well and I am able to find some trends but it is not perfect.
If slaughterhouses had glass walls, everyone would be a vegetarian!
  • #4
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  • Nov 16, 2009 11:19am Nov 16, 2009 11:19am
Quoting Gambler180
That answer didn't help me.
Well, that's what I do. The programming equivelant would be to ask if the price is higher than, say, 10 bars ago, 20 bars ago, 30 bars ago etc. I don't know what could be easier than that.
Gone to a better place
  • #5
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  • Nov 16, 2009 11:44am Nov 16, 2009 11:44am
Quoting smikester
Well, that's what I do. The programming equivelant would be to ask if the price is higher than, say, 10 bars ago, 20 bars ago, 30 bars ago etc. I don't know what could be easier than that.
Thanks. Do you know how to say from 30 until 50 in mql.
If slaughterhouses had glass walls, everyone would be a vegetarian!
  • #6
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  • Nov 16, 2009 11:44am Nov 16, 2009 11:44am
I have a indicator here which define trend from daily,weekly,monthly and yearly.

If you can incorporate the output of many currencies to be shown in one chart... that would be great !
Attached File(s)
File Type: mq4 # RANGE_TRADER_9.09 Labais53.mq4   20 KB | 732 downloads
The future depends on what we do in the present.
  • #7
  • Quote
  • Nov 16, 2009 11:59am Nov 16, 2009 11:59am
actually simply saying that your higher than 20-30 bars ago you are or not trending wont work... thats not a trend... a trend is a string of higher highs with higher lows or lower highs and lower lows consecutively. but lets say price is in a retracement simply saying 20-30 bars back would mean it could potentially be trending but if its at the bottom part of a retracement you maybe less than 20 or 30 bars but in an uptrend... i would use emas... if I were to program it. if ema X is higher than ema Y then trend is Z....
  • #8
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  • Nov 16, 2009 4:16pm Nov 16, 2009 4:16pm
Quoting domino
actually simply saying that your higher than 20-30 bars ago you are or not trending wont work... thats not a trend... a trend is a string of higher highs with higher lows or lower highs and lower lows consecutively. but lets say price is in a retracement simply saying 20-30 bars back would mean it could potentially be trending but if its at the bottom part of a retracement you maybe less than 20 or 30 bars but in an uptrend... i would use emas... if I were to program it. if ema X is higher than ema Y then trend is Z....
My plan is to use the indicator to find trends. When the indicator has found a trend I will look at the chart and do my own analysis. It is not finished yet but I have used it today. It told me that GBP was very strong and I made about 40 pips.
If slaughterhouses had glass walls, everyone would be a vegetarian!
  • #9
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  • Nov 17, 2009 12:37pm Nov 17, 2009 12:37pm
Here is what I have so far. I have made it as an expert advisor instead of an indicator. It is very good at finding trends but I think the code is too long. Isn't there a quicker way to do it? A lot of the code is nearly the same.
Attached File(s)
File Type: mq4 jimmiandersen.mq4   8 KB | 558 downloads
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  • #10
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  • Nov 17, 2009 9:20pm Nov 17, 2009 9:20pm
Trend is very subjective if no indicator is used. some would claim "Visual" ie, zoom out like the 2nd post, yet, zooming out, you'd see 2 trends forming: long term or medium term (start of reversal).

To be objective use either of the following:

100SMA on H1
200SMA on H1
100SMA on D1
200SMA on D1
MACD on H1, H4, D1
etc.
just pick one and stick with it.

Trend therefore is determined if candle is above or below the above mentioned indicator.

One might like to add "confirmation" by adding another indicator; not satisfied, one would add another and another to the point one ended up with so many lines, the chart looks like a 3 year old toddler's coloring book.

Bottom Line: Just pick one and stick with it.
  • #11
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  • Nov 17, 2009 10:51pm Nov 17, 2009 10:51pm
A threshold on the first derivative of a smoothing spline applied to the price.
The breaking of a wave cannot explain the whole sea.
  • #12
  • Quote
  • Nov 18, 2009 2:52am Nov 18, 2009 2:52am
Pretty easy - just use a SMA then another with a shift on it - In this pic I'm showing: RED 20 SMA - AQUA 20 SMA with a 6 shift
If shifted is lower were going up - If shifted is higher were going down
Attached Image (click to enlarge)
Click to Enlarge Name: trend.png Size: 8 KB
  • #13
  • Quote
  • Nov 19, 2009 1:24am Nov 19, 2009 1:24am
Quoting Aja
Pretty easy - just use a SMA then another with a shift on it - In this pic I'm showing: RED 20 SMA - AQUA 20 SMA with a 6 shift
If shifted is lower were going up - If shifted is higher were going down
As I see it the problem with this method is that according to the rules there will always be a trend even if the market is sideways.
If slaughterhouses had glass walls, everyone would be a vegetarian!
  • #14
  • Quote
  • Nov 19, 2009 1:39am Nov 19, 2009 1:39am
Quoting Gambler180
As I see it the problem with this method is that according to the rules there will always be a trend even if the market is sideways.
There are always multiple trends.
/ ... clarifying decisions ... /
  • #15
  • Quote
  • Nov 19, 2009 1:40am Nov 19, 2009 1:40am
Add the ADX as a filter. The ADX can signal Weak/Strong trends VERY easily. - Its a very accurate measure of trend direction and more importantly STRENGTH.
  • #16
  • Quote
  • Nov 19, 2009 1:44am Nov 19, 2009 1:44am
Quoting Aja
Add the ADX as a filter. The ADX can signal Weak/Strong trends VERY easily. - Its a very accurate measure of trend direction and more importantly STRENGTH.
...and it's always LATE.
The breaking of a wave cannot explain the whole sea.
  • #17
  • Quote
  • Nov 19, 2009 3:42am Nov 19, 2009 3:42am
Quoting Aja
Add the ADX as a filter. The ADX can signal Weak/Strong trends VERY easily. - Its a very accurate measure of trend direction and more importantly STRENGTH.
I don't know how to code that. Right now I am experimenting with moving averages and it looks like the following rules are good to identify a trend.

If 30 period exponential moving average shift 6 > 30 period exponential moving average shift 12 > 30 period exponential moving average shift 18.
If slaughterhouses had glass walls, everyone would be a vegetarian!
  • #18
  • Quote
  • Nov 19, 2009 3:48am Nov 19, 2009 3:48am
Quoting Craig
...and it's always LATE.
Well... you cant scalp with ANY indicator - I just use them for confirmation. - If you use the shifted SMA and ADX then you have a very nice trend confirmation system. I gave up using indi's for prediction a loooong time ago.
  • #19
  • Quote
  • Edited Mar 19, 2011 4:58am Mar 18, 2011 8:32pm | Edited Mar 19, 2011 4:58am
Quoting compro99
I have a indicator here which define trend from daily,weekly,monthly and yearly.

If you can incorporate the output of many currencies to be shown in one chart... that would be great !
Do you mean like this? Every currency is compared to 8 others. If price is greater than the open of the current candle a point is added and if price is lower a point is substracted.
Attached Image (click to enlarge)
Click to Enlarge Name: indicator.gif Size: 19 KB
If slaughterhouses had glass walls, everyone would be a vegetarian!
  • #20
  • Quote
  • Mar 19, 2011 1:29am Mar 19, 2011 1:29am
Quoting Gambler180
I am trying to make an indicator that tells if there is a trend or not. The indicator should check many different currency pairs on many different time frames and find the currency pair with the strongest trend. The problem I have is that I don't know how to define a trend. How do you decide if there is a trend or not?
This is pretty good definition and great ideas on TREND

Quote "1.Why trend traders fail and why I failed to become a trend trader in the past? The answer is simple; I never had a definition of “What is a trend?” If I come up with a definition of what a trend is then I can trade my definition and maybe be successful. I have read dozens of books, manuals, downloads (both free and paid for), thousands of posts, hundreds of threads, and seen millions of ideas, indicators, trading methods, etc. etc. etc. You get the picture. Anyway whether you agree with me or not this is what I am going to try to do. I am going to define what a trend is and then I am going to trade my definition of that trend. I am going to keep it simple and easy to follow so anyone can do it. That is my goal of this system."

Nb 1.0 trend trade system
Attached File(s)
File Type: doc NANNINBOB_1.0[2].doc   563 KB | 776 downloads
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