Hey guys I want to start a new thread about tendency follow. I love it.
I try to post some helpfull stuff for people that are starting with it or wish to start.
I exchange a genuine huge horizont for the majority of people in this forum. I tried smaller timeframes but its not my world. ( But each stage is welcome)
I hope we'll get some fascinating discussions.
The most people want more. They need more from everything they could get: Time, money, food, homes, automobiles, love and so forth. But we know that it's not feasible without giving up something else. That means: To get more money we have to give up time or energy or... It is always a trade between two products.
But there is 1 thing to consider. You may find a lot from 1 thing if you focus on it. Why? You spend all your energy on a single business. This is a big trade-off but in the end you receive more. A lot of successful businesses do that. In addition you find the sayingâ€less is more†in many self-help publiions.
Concentrate on a small market and decrease complexity
Trading is not different from the rest of the life. If you would like to learn something, you must have a deep understanding about it.
In my trading trip I learned this the hard way. In the start I was doing everything I could do. I traded shares, commodities, forex, certifies... However, this was only distraction.
After some time I discovered that I was able to build much more understanding and experience if I focus on something. I started to focus on only stocks and my trading enhanced.
Why did my trading enhanced? Simple: It diminished the quantities of transactions I made. And it helped me to focus on scenarios where I've an edge.
Should you trade multiple markets (stocks, commodities, forex etc.) you have to build up knowledge in all of them. You must think about a lot of dependencies between the markets. This may result in situations in which you increase your risk instead of decrease it. The reason: Many trading instruments have a dependence, f.e. Gold vs. USD, EUR vs. European stocks and so forth.
To create this more complied: The dependencies between trading instruments can change. That means that you may see: This is too complex to handle, particularly for a newcomer. The only solution would be to focus.
Becoming an expert in only 1 market
if you concentrate on a market, you have an additional edge. You receive a much deeper understanding and experience. With experience you can develop something like instinct.
For me personally instinct is merely deep knowledge and experience combined. You may apply it without active thinkings. It is engraved in the structure of your mind. It is engraved so profoundly that it influenced your feelings. You know it if you believe that somethingâ€is not correctâ€. That only means that you saw the exact same situation a million times before and now your mind sends you a sign.
This instinct or deep knowledge is connected to the hours of instruction. If you spend 1000 hours to learn and then replie 1 thing you have a deeper understanding about it. Your mind is trained and build the neural pathways to handle that situation perfectly.
Should you spend 1000 hours to 4 different things, you only spend 250 hours each each. This usually means you have less understanding about one of the 4 things.
Now you can argue that markets are the same, as they're predied on price. Yes, that is correct. However, there are small differences of this price-movement of those markets.
On a macro level all of markets seems the same. But if you would like to master a market, you have to look at the tiny differences. Recall: A master knows his area in each detail!
What does a market looks like?
I started as aâ€jack of all tradesâ€. Then I decreased more and more... I concentrated on only stocks, then reduced my design to only 1 trading method, concentrate on only US stocks, then sliced out the large potential/grow stocks market, focused on mainly small- and mid-caps... This helped me to make advance as trader.
It is funny, but the further I focus and reduced, the more progress I made!
Should you look at your own trading, ask yourself: What can allow me to make progress? This has a lot to do with your strengths and everything you like. In the end you must do everything to improve your confidence in your trading. And if your trading procedure is perfectly fitted on your strengths and everything you like, it increases automatically your confidence in it. Why? Because it reflects your character.
Here an example out of myself:I like stocks since there is a true supply and demand. You can see the quantity and price-action. There are many businesses. That means it's possible to trade different trends inside the stock market and also you may see the flow of money from 1 sector to another. You can trade stocks with a small and big account. The fees are low. The moves in stocks could be fast. I like that! There are actual businesses behind shares. Especially I like technology firms with new today unknown services or products. I love to find and search for shares that matches my standards. It is an endlessâ€detective sportâ€. You can apply screener on it and filter the markets. I have knowledge about programming. So I will apply it. With stocks you only trade small sizes and you can spread the risk between multiple positions. The upper things are embedded within my trading methods. I discovered them in the last years in which I look at myself and ask meWhere are my strengths? What do I like? What do I think that markets work?
Do not get me wrong. I'm not a fundamentalist. The opposite is true! I create all of my choice on price and quantity. But it gives me additional confidence if a stock has an intriguing story and background that's appealing to investors.
Putting it all together
The journey starts with an analysis of your current trading. If you collected data about your trading, then you can take it as a beginning point.
If you find out that you have a lot of different setups, trade multiple markets and make tons of trades, there is something wrong. Step back and ask yourself: What will happen if I remove something? What have my poor transactions in common? What have my poor trading times in common?
In the most cases you will find out that reducing helps. If you learn something perfectly the result is better. Consider a carpenter that creates tables. If he focus to make only 1 kind of a table perfectly, he will earn more money. Why? Because he has more understanding about it and may generate a high quality. Additionally the more experience will help to decrease the costs.
The exact same goes for trading:The more experience you have in 1 thing, the more you may pick the very best installments and trading environment. You may cut back the time you spend trading since you will find the setups faster. The number of poor trades will be reduced dramatically.
This guide consists of julian-komar. com
Ok Brother LordFX ,
Subscribed .. .Trend following is very old topic the large question is to know when the trend begins and when the trend ends I believe we should Follow the issue of how to analysis the start of the trend finish of this trendwish you best of luck for you thread expect it makes into the TOP ofnigeriaforextrading
Warm Regards
I agree, if we are going to be successful, the kind of trading we all eventually find has to match our personality type.
Trend-following suits me. But its also the only trading egy that lets you maximise profits by always upping your position size without adding to a risk. As long as the trend continues, I continue adding another position and moving the stop-loss using it. This allows your profits to improve parabolically while your funding risk never increases.
It will not be always quite simple to trade accurately by subsequent tendencies since while utilizing tendencies to make trading decisions it is important to comprehend which trends are reliable and good to move and which aren't workable. We can't follow every trend obviously. And yes trend analysis is quite important as the efficacy of our trading decision depends greatly on how well we're interpreting results of various prevailing tendencies and market behavior.
Yes following fad is very excellent. But market does not remain in trend for extended time. But yes if you are trading on limited time period, you might acquire trend that is small. And loing a trend's first phase is easily the task. You want both technical and fundamental understanding to ascertain a trend.Originally Posted by ;
Actual fad follow is not for everybody. Many people like me need to optimize their egies to make perfect entries and ideal exits. They jump from each system into another. (Shiny thing syndrom)
They loose some years without doing much because they never exchange a method long enough to learn it well. Like my 4 Years of bullshit
But for a while now I only follow the trend and try to find out more about it. Mostly the plogical aspect of holding trades longer and the reason why we wish to optimize with dumb stuff like martingale or other crazy things.
How to build confidence while loosing 6 days in a row and stick to some egy.
How to do exits the entrys doesnt matter for me much.
I think I've discovered the way that I would like to trade and now its time to perfect it
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