Uptrend, Ranging or Downtrend?

Hi traders,

Many have heard "buy the low, sell the high" , "trade with trend".

The problem is I don't know the current price is a Higher High or a Lower Low for the NEXT period, only to the past period.
If we following the trend we enter to late , maybe missing 30% of the trend beginning and we exit to late losing 50% or our profit. Here, in a trending market we need to Sell the LL and buy the HH. Sadly no pullback to Fibo level, sometimes the price just fly, like in today it was manipulation Monday. Then maybe turn to a Fibo level to hit the SL or it fly 300 pip without any pullback then a pause and other 300-400 pip, so counter trend , pending orders are useless. The perfect exit point it is still a HH or a LL, but in counter direction.

On a ranging market, just simply Sell the HH and Buy the LL. It is very-very profitable, until the market goes to trending...then a huge loss.

Here is an EUR/USD H4 chart zoom out.
Applied EMA or SMA to (H+L)/2, then other one to H and other one to L. So we see a band, where if is crossing, then the trend is over.

I would say it started trending when the price went trough the EMA band and bigger is the distance from the price to the closest EMA then closer is the turning point, until that is trending. If the price is below EMA band, then is an downtrend if is above, then is an uptrend.

Here is a chart:

Has uptrend turned to downtrend without ranging and has with ranging too

There is another:

Just downtrend+ranging

So it can't even say after X candles must be a turning point or a pullback or after X range.

The billionaire question is what to do on a new LL? - buy it or sell it? - same with HH

Many system works, but they work or in trending market or in ranging market.

I would like to make an indicator / system, where it shows 3 states: uptrend, ranging, downtrend for the past.
Also I would like to have some prediction of "maybe is a change now". For this MACD and Stochastic are the best candidates as I know, but I can't use it properly: or no signal (way to late) or fake signals.



Any ideas?

I think I got an idea:

It shows the close price distance from EMA applied to median ( H+L ) /2.
Bigger positive is the number then higher is the uptrend - or is maybe a spike to upper side
Bigger negative for downtrend
Close to 0 is ranging

Hi Matheszabi,

You know you can just configure the standard MACD to do the same as that indicator right?
However I believe you are on the right track.



To be honest I am not surprised that you got no replies to your opening post as what you are asking for is effectively being able to predict the future. Nobody can. Best we can do is follow the market and trade in accord with it.

Regards

Neio

Something related to this:
http://www.forexfactory.com/showthre...51#post8508051

TODO: check it on weekend that and a similar system, looks promising on a trending pair before his daily major movement Ex Eurusd, gpbusd after London open, before NY open

Hello man,

I am a trend follower, I also met this problem, there a delay between the moment the higher high is reached, and the moment the indicator indicate a down trend, and between the moment the indicator indicate a down trend, and the moment the takeprofit is taken.

Indicator indicate that the trend as changed with a delay, at the end of a trend up, if orders have been taken between the HH and the signal, they are all in loss.

This cannot be avoided, there is alway loss at the end of a trend.
If a trend start and change side at the same moment the signal is send, then it was a false signal.