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Attachments: Trend Trading
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Trend Trading

  • #441
  • Oct 27, 2018 12:22pm Oct 27, 2018 12:22pm
Quoting Taigen
{quote} I would have but got turned up side down. Two months later I was able to get out without too much damage. I could have made some serious coin if I stayed in but when stuck in a currency pair for that long, I'm no longer a trader but a nailbiter. Since I'm doing micro pips when my first position is at a $10 loss, I get out and replace in a better position but realizing I have to make that $10 up again before I see green. My GU position is a good example. It's not at the bottom if I compare to the July 2018 PA. If you see how I trade you will...
If you don't mind, I have a few comments about your trading. You could accept or ignore these comments as best fits your personal style of trading. First, I commend you for being wise enough to trade micropips until you have all these details worked out. It sounds like you gained that wisdom through painful experience, as most traders do. I busted my first account as well, and I know of very few successful traders that didn't have to go through that ugly rite of passage.

Next, if an initial trade goes against you and you quickly cut your loss short, that's generally a good thing. But if your entry criteria still shows an entry and you immediately re-enter the trade, you are in danger of being whipsawed. Generally, the way to avoid the whipsaws is you stay in the trade until your entry criteria is invalidated. That not only avoids most whipsaws, but it allows you to stay in the trend longer, possibly making more pips. You can find your personal "sweet spot" by extensive backtesting and by keeping track of what would have happened in live trading. If you find that over a long period of live trading you are missing more moves of the trend in your direction than you are saving in losses with your exit criteria, then you might need to re-examine your exit criteria. I'm looking at the trend, and it only changed on the very short time frames, the 1M, 5M and 15M. The longer timeframe trends from 30M and above still seem to be down. Since you are trading primarily daily charts (good for you!), you have to expect many small retracements in the course of a trade. If normal volatility is knocking you out of what is otherwise a good trade, then you may need to make more allowance for it. You can judge normal volatility for that pair in this market condition by checking ATR or checking this site, https://www.investing.com/tools/fore...ity-calculator

Finally, I always say, entries are the easy part. One could flip a coin and get it right almost half the time. Exits are the hard part. I think if you study your exit criteria carefully and work very hard on improving it pip by pip, you'll do well in this business. Of course, that's just my own humble opinion. Best success in your trading. - G
  • #442
  • Oct 27, 2018 3:21pm Oct 27, 2018 3:21pm
Quoting Graviton
{quote} If you don't mind, I have a few comments about your trading. You could accept or ignore these comments as best fits your personal style of trading. First, I commend you for being wise enough to trade micropips until you have all these details worked out. It sounds like you gained that wisdom through painful experience, as most traders do. I busted my first account as well, and I know of very few successful traders that didn't have to go through that ugly rite of passage. - G
Thank you for spending the time to give me some of your experience in forex. Yes, like most, I've gotten beat up pretty bad. Starting with such thoughts as "...wow I got this figured out and will be a millionaire within a year..." to, "...can anyone make money in forex." After blowing three accounts, I did, after much reflection start to study what I was doing wrong as well as what I was doing right. Although most put a single position down and make determinations based on that--and I've done that--I have concluded that, my disposition is better suited in multiple position trading with small lots. Profit wise, both strategies seem to come out the same value wise.

"Next, if an initial trade goes against you and you quickly cut your loss short, that's generally a good thing. But if your entry criteria still shows an entry and you immediately re-enter the trade, you are in danger of being whipsawed"

Totally agree. However, I usually only get burned if it goes 200 or more against me. Then I'm in recovery mode like my last GJ trade. If I logically continued as I did in the beginning, I would have made 600 pips. Even though I got out I'm pretty much back to where I was. My son would have told me to stay in and talk me out of my jumpiness. Oh well. What I generally do now is hope that it goes up (it may or may not) and get out with the red positions and keep the green positions. I could turn out that I unload them all depending on the trajectory and the Stochastic and RSI and the SMA's. With the double bottom, I'll position as much as I can there. If the support drops, I'm out to trade another day.

I only trade live now. Learning the ropes on a demo is something I highly recommend. You should get your sea legs in 3-6 months. To go beyond that with no 'skin' in the game, to me, gives one a false sense of reality. Blowing a few accounts and learning from them should be considered as tuition for learning the game. It's the real money that makes this game serious.

I want to thank you for the investing tools website. The info looks quite valuable. Thanks for your suggestions.
Taigen Profit This Month: na
  • #444
  • Oct 27, 2018 4:35pm Oct 27, 2018 4:35pm
quote=rod777;11631865]https://www.youtube...

Rod, if you want to try to sell an EA, please go to the commercial section. This is the discussion Forum, and I see no discussion in your post. Thanks -G
  • #445
  • Edited 11:46pm Oct 27, 2018 5:12pm | Edited 11:46pm
I kinda think that if anyone had an EA that would take $10 to $5,000,000 in a month, they might go sell some blood plasma or hock Grandma's jewelry and invest $100 in it and buy their own private island in a couple months. Maybe I'm just an old cynic, but somehow I just can't see that happening. Be careful traders, there's a scam lurking behind every lamp post. - G
  • #446
  • Edited Oct 29, 2018 9:54am Oct 28, 2018 11:02am | Edited Oct 29, 2018 9:54am
Looking at the GU, here are my observations:

Weekly: Downtrend - Weekly has little to do with trading but it does give a general direction of the market.

Daily: Downtrend - It's looking at a double bottom just below the 127 PA. I'm already positioned for a counter trend trade. I may have gotten in a little early but we'll see.

4 HOUR: Downtrend - I use the 4 HOUR for positioning up or down regardless the trend. If you do a counter trend trade BE VERY CAREFUL. It can turn on you in a dime.

1 HOUR; Flatline Downtrend - This is for the short termers and scalpers.

1, 5, 15, 30 MIN trends: It doesn't much matter. You look at these for positioning on getting in or out.

Right now my hope (laughable) is that it would go up so I can get out of some bad positions. Even if it doesn't my loss will be minimal so I can reposition around the double bottom. There is actually two double bottoms: one at below 127 and the other at below 126 so I have to keep that in mind. A fibo retracement would suggest at least a 100 pip ride. See what happens.
Attached Image (click to enlarge)
Click to Enlarge Name: GU 10 28 18 Daily (2)_LI.jpg Size: 1.3 MB
Taigen Profit This Month: na
  • #447
  • Oct 28, 2018 12:24pm Oct 28, 2018 12:24pm
Taigen,
you are catching a falling knife.
this method might work for a while, but is doomed to blow up your account one day - even with small positions if you don't stop adding on.
at least wait for a little bit of confirmation that the trend has gone the other way for a few days.
just my opinion.
  • #448
  • Edited 2:22pm Oct 28, 2018 2:10pm | Edited 2:22pm
Quoting Taigen
Looking at the GU, here are my observations: Weekly: Downtrend - Weekly has little to do with trading but it does give a general direction of the market. Daily: Downtrend - It's looking at a double bottom just below the 127 PA. ...Right now my hope (laughable) is that it would go up so I can get out of some bad positions. Even if it doesn't my loss will be minimal so I can reposition around the double bottom. There is actually two double bottoms: one at below 127 and the other at below 126 so I have to keep that in mind. A fibo retracement would...
I'll give a few unsolicited opinions. I agree with Yonnie that we should never try to catch a falling knife. Occasionally we'll get it right spot on and think we were a genius, but in fact, the knife keeps falling further than we can remain liquid in more cases than not, so the odds of a perfect catch are small. As you observed, the trend for daily traders is clearly down. This is confirmed by the H4 and weekly. Even the H1 shows no signs of a trend change. It looks like the daily bottom around 127 was a bounce off a prior support, which we often get on the first try to break it. It looks like price is going back at that support again, with more momentum this time. Hope is not a strategy my friend. "Ye who enter here, abandon all hope." You may very well be right and I encourage you to do what you think is right. I'm just saying that from my perspective of always trading with the trend, no matter how costly or painful, I would now be looking at cutting my losses and either positioning for a probable extended move downward or just looking for a way to completely extricate myself from this trade no matter how painful and let the market resolve it's direction. Of course, I don't trade like you do so I can't do anything more than tell you what I'd do in this situation. I wouldn't let a little scratch turn into a bloodbath, and you know well what I mean.

More broadly, trading as I do I have many opportunities to consider losing. Everyone wants to think about winning, and of course that's more pleasant to think about, but in my opinion, learning to lose correctly is the critical step to becoming a successful pro trader. Generally, taking a good odds trade and cutting the loss as short as reasonable as soon as the entry criteria is invalidated or the price action doesn't conform to the original expected performance is the most critical component to professional losing. There are only a few ways to lose and a very large number of ways to win, so losing wouldn't be that hard to master if thinking about it wasn't so painful. Taking a trade that you know presents bad odds is a way to lose over the long haul. Another component is to never compound your losses. Averaging down is an example of the wrong way to lose. It will occasionally work, but it's a bad odds move and it will drain your account over time. Holding on to losing trades long after it is obvious they are losing in the hopes they might turn around is also the wrong way to lose. Closing them quickly as soon as it's obvious they are losing is ALWAYS the right thing to do. It won't always work, but it will eliminate large losses from your trading and that makes it the right thing to do whether it works in that particular case or not. It's usually best to have very solid rules as to when you will take a loss so you don't ever have difficult decisions to make while trading. I have rules that my system forces me to follow, so it's never my fault. I only have to make one decision in trading, to follow my system or not. After that, all the decisions are made by my system. Then even though the loss is still painful, you at least have the consolation that you followed your rules and that will make you successful over the long run. That is the only consolation I can expect. The market owes me none.

I don't mean to be critical of your trading and I truly wish you all the best. If you want to consider the painful art of mastering losses some more, I'm always here. - G
  • #449
  • Oct 28, 2018 9:15pm Oct 28, 2018 9:15pm
Taigen, one thing i learn from this business is that trade what you see. not what you expect. you put ma lines saying its in a downward trajectory. so if i were you, i would try to find opportunity to sell. whether I am correct or not, doesnt matter. as long as i keep trading small in respect to my equity, then every little thing is going to be alright. - thats what Bob Marley said in one of his songs
  • #450
  • Oct 29, 2018 12:12am Oct 29, 2018 12:12am
Thank you for your concerns and I am quite versed in the art of losing. I did a counter trend which got me a few pips. You win small and you win big. This time I just banked a few pips ~20 or so. It could still go up according to the fibo but I decided to take my winnings off the table because I think the double bottom will be tested. Yes it's still a counter trend. I do them because I find them very profitable.

One thing the market does and is solid as concrete, and that is, it goes up and then it goes down. Counter trends are quite predictable in the sense that buys and sells exhaust themselves and usually go into a consolidation. After that, based on patterns, I go one way or the other and get ready to stop out. Once I'm in the green, I usually put in a zero stop and walk away. I get antsy if I profit more than 200 pips and usually put in a take profit position and a profit loss position and eventually narrow the interval.

it may sound spastic to you but it works for me more often than not.

I have two Trade Explorer accounts and I leave nothing private. What you see is what you get. You see my smart trades as well as the stupid ones. I started with $2500 and got to $4400 but did some stupid moves and I am where I am. The other account, I think I started with $3oo and am at $513. I know these are baby accounts. I consider a baby account anything under 10k. I hope to break through one day like you guys. We'll see.



I appreciate you concern.
Taigen Profit This Month: na
  • #451
  • Oct 29, 2018 10:00am Oct 29, 2018 10:00am
Quoting Taigen
Thank you for your concerns and I am quite versed in the art of losing. I did a counter trend which got me a few pips. You win small and you win big. This time I just banked a few pips ~20 or so. It could still go up according to the fibo but I decided to take my winnings off the table because I think the double bottom will be tested. Yes it's still a counter trend. I do them because I find them very profitable...
Hey Taigen, glad you managed to snatch some pips from that trade. I've never been able to get the timing right on counter trend trades, but I hear some do quite well on them. The only thing that I've found that works for me is follow the trend, until it bends, so I guess each must find their own path. Best success. - G
  • #452
  • Edited 10:37am Oct 29, 2018 10:22am | Edited 10:37am
Just like we, as individuals strive to seek balance in our lives, so to does everything else from the weather to population growths and decay to all markets. There is a perpetual striving to seek balance. The forex market is no difference and we see that in the price action. If the market reflects a downward trend on a given currency pair then we would all make money by shorting--right? A big fat wrong! If trends were a guarantee of making money, everyone would be a millionaire. But it doesn't work that way. The price action is striving for balance.

If Boeing makes a multiple plane sale, it doesn't matter what trend the currency pair is in, it will set a time frame to start buying gobs of currency. Of course this will be done over a period of time but it will affect the balance in that the demand for that currency is there. I knew a guy who worked for Boeing in sales and the currencies had to coincide with the value of the sale. In other words it's complicated and just because something is trending one way does not mean it can't go against it. That's why I often, not always, counter trend trade.

The skill level is knowing when the reversal is a hiccup or a retrace.

Below is GU chart with about a one year interval. Notice how the PA is threading itself around the 200 SMA. It's in a perpetual state of seeking balance. That's why many traders will often forecast that there needs to be a turnaround depending on how far it strays from the 200 SMA.
Attached Image (click to enlarge)
Click to Enlarge Name: GU 10 29 18 example of balance (2).png Size: 72 KB
Taigen Profit This Month: na
  • #453
  • Oct 29, 2018 10:29am Oct 29, 2018 10:29am
Trading if you have a directional bias, whether it's a full-on trend or not, is of course great (if) you can reliably determine trend bias for at least 1 pair, each and very single day for intraday trading. If you want to be right each and every day intraday then you have to develop a strategy that is compatible with both counter-trend and trend because as you basically said, who knows if it's counter-trend because it might actually become a trend in that direction. Getting the timing right as you said is something I believe I have figured out so I'm giving it a go on my live. I'm also seeing the benefit of not using a takeprofit (and of course no stoploss either) and just letting those trades run and then closing the basket around 18:00 GMT+3. You (can) reliably identify a trend but the problem is, those signals are far and few in between. Who wants to wait days in between before trading? That style of trading would be torture.
  • #454
  • Oct 29, 2018 10:44am Oct 29, 2018 10:44am
Quoting spotrate
Trading if you have a directional bias, whether it's a full-on trend or not, is of course great (if) you can reliably determine trend bias for at least 1 pair, each and very single day for intraday trading. If you want to be right each and every day intraday then you have to develop a strategy that is compatible with both counter-trend and trend because as you basically said, who knows if it's counter-trend because it might actually become a trend in that direction.
Right on brother...

I looked at your Trade Explore and you're definitely putting your money where you mouth is. Consistency is the key and you got it!
Taigen Profit This Month: na
  • #455
  • Oct 29, 2018 1:20pm Oct 29, 2018 1:20pm
Quoting spotrate
Trading if you have a directional bias, whether it's a full-on trend or not, is of course great (if) you can reliably determine trend bias for at least 1 pair...
Hey Spotrate. Glad to see you are doing well. As far as trend trading goes, I can only see what the trend was in the past. My method assumes that the future is unknowable so I use simple methods to determine if a trend might exist currently in a pair. If it looks like it does, I'll try to trade it. If I'm right, I'll try to stay in it as long as I can and even add to the trade without giving back too much of the profits. If I'm wrong, I'll attempt to cut my losses very short, typically about 1/3rd of my average win. I can find a trend most days in the 28 pairs I follow. Of course, what looks like a trend on one timeframe may look like a reversion to mean on another, and both viewpoints can be considered correct. For instance, here is a 4 hr live chart of what I identified as a strong trend up on the EUR/GBP:

Attached Image (click to enlarge)
Click to Enlarge Name: 000EG.PNG Size: 50 KB


Now if we look at the same pair on the Daily chart, we see a clear reversion to mean:

Attached Image (click to enlarge)
Click to Enlarge Name: 0000EG.PNG Size: 51 KB


Someone like me trading the trend would probably stay in this trade or even add to it since the 4 hour chart shows it still moving strongly upward. Someone trading counter trend or reversion to mean might consider this a good time to take profit since price has now made it back to mean. Both would enter the same trade, but their exits might be different, and of course, exits are where money is made or lost. The market will decide who was right and who was wrong, for this case. The next time it may turn out the opposite way.

Of course, price must always revert to mean eventually, otherwise it would go off to infinity or drop to zero, and both of those are very unlikely. The question is when will price revert to mean, and how much past the mean will it run before it turns down again? Unfortunately I don't have the foresight to see that in advance. That's why I'll follow this trend until it bends and exit with most of my profit when that happens. If I give back say 30% of my profit before I exit on a deep retracement and you take all of your profits here, then you might have the better win on this round, but I can only trade what I see and I can only look into the past to make my decisions. Trading with these trends is just the best that I know how to do. Trying to trade both trend and counter trend would be very confusing to me, but if you have mastered that difficult art, I congratulate you. Happy trading! - G
  • #456
  • Oct 29, 2018 9:28pm Oct 29, 2018 9:28pm
Quoting Taigen
Just like we, as individuals strive to seek balance in our lives, so to does everything else from the weather to population growths and decay to all markets. There is a perpetual striving to seek balance. The forex market is no difference and we see that in the price action. If the market reflects a downward trend on a given currency pair then we would all make money by shorting--right? A big fat wrong! If trends were a guarantee of making money, everyone would be a millionaire. But it doesn't work that way. The price action is striving for balance....
Nice chart! But what’s your opinion on support/resistant level? I don’t see any S/R level on your chart! Do you use support/resistant? Or avoid?
  • #457
  • Oct 30, 2018 12:39am Oct 30, 2018 12:39am
Quoting MariaEduard
{quote} Nice chart! But what’s your opinion on support/resistant level? I don’t see any S/R level on your chart! Do you use support/resistant? Or avoid?
Wow, what a great question. When I think of support and resistance the word in my mind is 'history'. When a S/R develops I usually draw a horizontal line and see if there is history going back 2 years or 5 years. Some go back even ten years. So yes S/R is extremely important. I usually draw trend lines that, in most cases become a channel. Some of my graphs are very simplistic and gradually the S/R lines are put in. I don't elaborate constructions that you see sometimes. That is not to say they don't work, I just like simple. Every trader develops their own indicators and what not. Generally I like to go as simple as possible.

When traders do a history they often use the line graph of the price action as shown below just for simplicity. I draw them thick because it reminds me that support and resistance can be swath like (thick) but sometime they are specific. They are easy to produce and it wouldn't hurt to have a copy of it when you're considering S/R research. This chart I just made is a 2 year look at the S/R.

If you see 3 or more points of S/R, that can demonstrate to be very powerful tool.

I'm not a guru on this so you might see better line placement than what I did. I'm pretty close though.

My two cents.
Attached Image (click to enlarge)
Click to Enlarge Name: EU Daily about 2 years of S-R lines (2).png Size: 34 KB
Taigen Profit This Month: na
  • #458
  • Oct 30, 2018 5:18am Oct 30, 2018 5:18am
Quoting Graviton
{quote} I'll give a few unsolicited opinions. I agree with Yonnie that we should never try to catch a falling knife. Occasionally we'll get it right spot on and think we were a genius, but in fact, the knife keeps falling further than we can remain liquid in more cases than not, so the odds of a perfect catch are small. As you observed, the trend for daily traders is clearly down. This is confirmed by the H4 and weekly. Even the H1 shows no signs of a trend change. It looks like the daily bottom around 127 was a bounce off a prior support, which...
you are absolutely correct man...this the first month of trading that i am actually following my rules 200% after like ten years of constant staring and trading the market and interestingly this is the first month ever am having a rest of mind trading..i have bragged over the years and lied to myself over the years but i think being brutally honest with oneself eventually help..i still make some silly mistakes here and there but am sure it will get better now that i know the importance of following strict rules as a trend following trader... please i will appreciate some more brutal honesty about losses... my growth have been very gradual over the years and maybe its bcos am a very slow learner.
  • #459
  • Oct 30, 2018 10:43am Oct 30, 2018 10:43am
Quoting beejay
{quote} you are absolutely correct man...this the first month of trading that i am actually following my rules 200% after like ten years of constant staring and trading the market and interestingly this is the first month ever am having a rest of mind trading..i have bragged over the years and lied to myself over the years but i think being brutally honest with oneself eventually help..i still make some silly mistakes here and there but am sure it will get better now that i know the importance of following strict rules as a trend following trader......
Wow, that is really great to hear Beejay. I can tell you are experiencing the relief of trading with a set of rules so you only have one decision to make, to follow your rules. After that, every possible decision has already been made my your system. It also took me a very long time to develop a set of rules. There was a lot of misinformation and distraction along the way and that slowed my progress. In the end, I decided to simplify my trading to simplify my rule set. I now only have one simple entry criteria and I accept that it's not perfect, but really nothing ever is. I enter every trade that satisfies that criteria on the 28 pairs I monitor. So entries, done. There are two reasons to exit, to take profits and to stop the bleeding of a loss. I place a hard emergency stop around 1 X ADR adjusted for recent s/r lines on entry as one exit rule. Losing trades should be excised from my portfolio of trades as soon as possible like a cancer. Usually I'll cut them short at about 1/2 ADR. Shorter is better. Always. These are simple rules by design, but they save me tons of grief while trading.

There was a time when I couldn't sleep at night for fear of losing at my trading. Now, I sleep like an innocent child. I don't care much if a single trade exits at a loss while I sleep. It's only one of the next 100 trades I will take. That's built into my system. But that doesn't mean I take losing lightly. I work all the time not to avoid all losses, that's impossible, but rather to reduce their average size relative to my average wins. It's a relative thing. It doesn't matter much if I'm losing 2 out of every 3 trades I take, as long as my average win is 3 times my average loss. If it's not, I have two options, either reduce the size of my losses or to increase the size of my wins. Either works equally well. Reducing the size of losses is always a great idea since it is always the large losses that will take you out of the game. At one point, I considered all my past trading profits and losses and I realized that if I just removed all the large losses, I'd be trading like a rock star. So, that's what I did. I made a rule to exit any trade no matter what before the loss became large (the easy part) and I decided to follow my rules no matter what (the hard part). It was not at all easy, but it was very simple. In the end, losses are just a choice. How could I have been so thick headed to choose to keep taking large losses for so many years? It was if the weight of the world was lifted off my shoulders. I hope everyone reading this thread gets to experience that pure joy of leaving their fears behind in the rear view mirror. It's a wonderful relief. Best success to all. - G
  • #460
  • Oct 30, 2018 11:17am Oct 30, 2018 11:17am
Quoting Graviton
{quote} ...I hope everyone reading this thread gets to experience that pure joy of leaving their fears behind in the rear view mirror. It's a wonderful relief. Best success to all. - G
Well said Graviton. Everyone needs a goodnight sleep.

I'm speaking in generalities and when I say 'hope' it is under the premise that the PA is going to do what its going to do. It's like everyone here; you hope that you win at every single position you make but you know you are just making educated and experienced guesses. You sometimes win and sometimes you don't. I like what you said G about minimizing your losses. That's an incredible learning eureka moment. It turns everything around and it sure did for me.

I still say 'hope' in my posts--in my last one I think I put in parenthesis 'laughable' but apparently nobody got that--so don't take it so literally.

Happy pipping
Taigen Profit This Month: na
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