Lots of people seem to use the term "fade". It seems to mean something like "disregard" judging by the context. Can someone give a fairly detailed explanation of what this means precisely in terms of the markets?
- | Joined Mar 2004 | Status: Valued Member | 211 Posts
it means just what you said..."disregard". but maybe more precisely, it means taking a contrarian approach to the action.
if you fade a move, its like saying "bullshit!!!"
- Joined May 2011 | Status: Making money 1 pip at a time. | 2,150 Posts
so if it means to "fade the retrace", do you disregard the retrace as a legitimate move in the other direction, or do you disregard the retracement as a false move in the other direction and go forth in the original direction
Most professional traders fade breakouts (trade against them) for example (while amateurs chase them), because most breakouts are false.
Hope this helps.
