Which is better: TREND or CONTRARIAN trading?

If majority (95%) are losers, wouldn’t it be wise to be different???

This is to provoke thoughts.
Please comment…Thanks for reading…

For newbies, I say stick with trend…
For pros, I say do what makes the most bang…

Comments???

Neither. Trading is trading. Profit or loss. That’s it. Profit is better.

Trade the trend and hedge the retraces. :slight_smile:

Here’s an interesting little article that looks a little bit like both contrarian and trend trading. Robert I wouldn’t mind hearing your thoughts on it. It kind of goes back to my other thread regarding trade management but fits into this thread also.

SFO Magazine Article

Actually if all you are going to measure it by is profit, trend trading is far superior.

A traditional trend trader can get in and ride the trend until it’s over, possibly resulting in 1000’s of pips from one trade in a few months. A, “contrarian,” trader would have to do many more trades and try to predict retrace points many times.

Also, trend trading is far easier. And is more forgiving of iffy entries. If you are in the direction of the trend the trend can often make up for bad entries if you can wether the drawdown before price retraces in your favor and the trend continues.

I trade short term trends lasting at most a few days. Usually in a range of 100 to 200 pips. It varies. The trick is you have to learn to recognize when it stops trending and starts ranging.

That’s easy to say in hindsight. A couple of weeks ago, the usdjpy appeared to be bouncing off support and to be in an “uptrend” heading back to 90.NN. It make it there today, but, it took a little detour to 84.NN before it went to 90.NN.

Which is better: TREND or CONTRARIAN trading?

The answer of course, is yes

Don’t know what charts you are looking at but the U/J has been trending down for the quite a few weeks, with this week retracing up somewhat…

But, it’s still in a down trend, and not near a point where a trend follower would exit, where the trend invalidated.

To an experienced trend trader it would still appear to be in a down trend a few weeks ago. And it’s pretty easy to spot.


So define a trend.
If we all went with it all the time then we would all have to short GBUS since it’s been on a down since it’s 1981 highs. Rallied a bit in the mid 80’s though.

So which is better Trend or Contrarian trading? They both work.

What I’ve come to realize is that almost everything works and fx really isn’t as hard as so many make it out to be. There’s a few bumps you have to get over, but it’s all gravy from there. Why there’s even a kid I’m aware of barely dry behind the ears who turned $250 into a mil ! :rolleyes: Of course, he did have a really good mentor;)

Forex is like a big jigsaw puzzle, and everyone sees their own little pile of pieces but no one seems to be looking at the picture on the front of the box.

Chances are I have more years trading experience than you have trips around the sun.

Miss out on half the pips you could be making? Let’s look at what you said: COULD be making. Why is it COULD? Is that because there is a chance you COULD not be making those pips because of an error on your part? You are long but price is going down, you lose. Then you switch to short and price reverses on you, you lose again. I believe that happens more often than not otherwise 95% of traders would not lose. The “illusion” is that you COULD BE MAKING all of those pips.

If you always trade long, then if price is going down you wait. When price reverses then you go long. If price reverse again, you lose. Sooner or later price will reverse, and you may win big. Look at the daily charts on the EURJPY for the last 2 weeks if you want to see a very clear example.

While EURJPY was going down, there were other pairs going up that I would be trading long.

The forex puzzle does not come with a picture on the cover - it’s a work (of art) in progress.

It depends on your personality. I’m more of a countertrend trader while others are better at riding trends. I’m sure some people are good at both.