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How to enter a trend?

  • #21
  • Apr 6, 2007 9:31pm Apr 6, 2007 9:31pm
Quoting jacko
I started trading Forex about a year ago. Have traded futures for much longer (15+ years?).

Started a trading journal at DailyFX about 9 months ago.(ONLY FOR PEOPLE IN LIVE TRADES-Jacko's Pleasure and Pain conversations).

Lost interest there when a lot of young aggressive newbies came in.

This seems a more rational forum.

I trade only the euro/usd. I trade large lots. I follow the trend.
Is this still true?
You only trade the euro/usd?
Stan
  • #22
  • Apr 7, 2007 6:42am Apr 7, 2007 6:42am
The theory is pretty simple when it comes to trading the trend:

1) spot the trend: you can use MAs for this (30, 50 and 100 SMAs being my favorite), or trendlines, or simply higher highs and higher lows for uptrend (viceversa for downtrend).

2) wait for a retrace to a level of confluence of support/resistance (fibs, MAs, previous swing's high/low, pivots, round numbers, whatever your tools are).

3) enter upon confirmation that that level of support/resistance is holding (123 patterns, candle stick formations, retracement-trendline breakout, whatever your tools are).

4) set stop loss below the retrace (in an uptrend, opposite for downtrend) and target price at fib extensions, or price pattern projection, or average move range for your specific time frame, or next level of support/resistance, or whatever your tools are.

Now that's the theory, of course doing it live is when it all gets tricky
  • #23
  • Apr 14, 2007 10:04am Apr 14, 2007 10:04am
Quoting Stan
Is this still true?
You only trade the euro/usd?
Stan
Hi Stan,

Recently started "playing" with the GBP/Usd for a bit of additional interest. It tends to be 3X more volatile than the eur. Also tends to be less "trend"y.

Would not recommend it...stick with Euro. (Just my opinion)

.
  • #24
  • Apr 14, 2007 11:24am Apr 14, 2007 11:24am
1) Watch the water to see which direction and how fast it's flowing.

2) Jump in. Let it pull you along.

3) Stay close to shore so that you can get out when it starts
going the other way.

!!!) Wear a lifejacket to stop you from getting suddenly pulled under.



FXS
  • #25
  • Apr 14, 2007 1:31pm Apr 14, 2007 1:31pm
I don’t know how to say, but to catch the trend (whichever the “trend” meaning [is it long, medium, short, retracement, or continuation]) and to ride it is the only major theme in this forum, so how about reading all the stuff outside this thread. Many master out there like Jim, Charles, Mouteki Trader, Scott, Bago, Vegas, etc.

Suggestion: MA in action is a good trend follower, any kind of combination you can think off, but you’ll waste some pips upon the confirmation of a trend. Bago method that I used all the time to catch trend is a nice one. Mouteki method to catch earlier breakout is a nice one too. Team aphid the bat to catch breakout is awesome. So what kind of trend do you want? And how you define trend? I think you should clearly define what you want first.

Just my opinion. CMIIW.

Andy Laodeabdul
  • #26
  • Apr 14, 2007 6:41pm Apr 14, 2007 6:41pm
Quoting laodeabdul
MA in action is a good trend follower all the time, any kind of combination you can think off
That is exactly why ma's aren't very good to use. They follow, in-other-words after the fact they tell where trend has been.

Trendlines are a much better choice imo.
  • #27
  • Edited 11:06pm Apr 14, 2007 10:47pm | Edited 11:06pm
Quoting SunTrader
That is exactly why ma's aren't very good to use. They follow, in-other-words after the fact they tell where trend has been.

Trendlines are a much better choice imo.
I understand your scepticism on MA's but; If I change the verbage it could be read as;

MA's measure how much tolerance THE Traders had/have to price fluctuation in the recent past. Will it remain true? Perhaps I should wait for confirmation.

True: Price is King:
False: Indicators are Useless:
  • #28
  • Apr 15, 2007 8:35pm Apr 15, 2007 8:35pm
Nitman

I have run across this post of yours... is there naymore you can add to what you say here?? I would like to try this !!! How would you avoid the whippsaws?? In other words, if you enter a trade when the lines cross, how do you know they will continue and not just cross right back again ??

Thanks a lot for your time and answer !!!!!!!!!!!!!!!!!!!!!!!!!!!!!

Tiki Trader


Quoting nitman
Following a trend is easy. I use MACD with default setting 12,26,9 on 1H or 4H and follow the oscillating lines. It can be a whole system alone by itself!
  • #29
  • Apr 20, 2007 6:13am Apr 20, 2007 6:13am
Quoting FXSurfer
1) Watch the water to see which direction and how fast it's flowing.

2) Jump in. Let it pull you along.

3) Stay close to shore so that you can get out when it starts
going the other way.

!!!) Wear a lifejacket to stop you from getting suddenly pulled under.



FXS
lol great metaphore !
  • #30
  • Apr 21, 2007 5:00am Apr 21, 2007 5:00am
Quoting jacko
Hi Stan,

Recently started "playing" with the GBP/Usd for a bit of additional interest. It tends to be 3X more volatile than the eur. Also tends to be less "trend"y.

Would not recommend it...stick with Euro. (Just my opinion)

.
I agree with this. The GBP/USD needs bigger risk to avoid being stopped out because of the volatility (for my strat at least). The EUR/USD and USD/JPY fill my needs for both 5 minute and 24 hour charts. As I don't (ever) pyramid my trades I often look for a second currency once the EUR is trading, or, sometimes the JPY trends during the Asian FX open and t he Euro doesn't.

I've still got a long way to go before I'm good at this though
  • #31
  • Apr 21, 2007 10:49am Apr 21, 2007 10:49am
Quoting jacko
Hi Stan,

Recently started "playing" with the GBP/Usd for a bit of additional interest. It tends to be 3X more volatile than the eur. Also tends to be less "trend"y.

Would not recommend it...stick with Euro. (Just my opinion)

.
Thanks Jacko.
Stan
  • #32
  • Last Post: Feb 8, 2010 7:28am Feb 8, 2010 7:28am
Quoting Day Trader
I invite all the viewers of this thread to share their experience about following a trend. How to recognize a trend? How to catch a trend? And how to enter a trend?
My 2 cents.. you can recognize a trend if you try to find a peak series. If you see ascending minimum peaks, it is most probably up-trend. Conversely, descending maximum peaks give us a hint about down-trend. Nothing new, it's a classical definition to trend actually. When trend ends? Just using the same definition. When ascending minimums are no longer ascending, meaning a new minimum peak is lower than prevoius, one can say that "Trend is no loger your friend". It's important what to do in this situation? Usually trend reversals do double tops/bottoms or "head & shoulders" pattern. So it is often possible to exit on return to resistance line (double bottom case) or "neck" line ("head & shoulders" case).
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