Hello traders!
Are you always trading with the trend and why? Do you trade trend reversals?
Trend is just an ilussion. Sorry Kid but many traders believe in patterns and that stuff.
You mean price action and that stuff? 
When I look at the charts and patterns on charts, I also see that trend doesn’t matter and it’s possible to profit even if you trade against the major trend. But so called “experts” always say that people should trade with the trend and I don’t understand why!
Let me put this way, when you see a trend it is too late to take it. You see candlestick patterns I see a bunch of sucker watching candlestick patterns.
Sivricmarijan,
Don’t pay any attention to anything Mr Gone posts. From time to time he pops up here at babypips and posts a bunch of rude foolish crazy rants.
If you are going to discredit at least don’t be so lazy and type a different message each time. Markets do a little more than crazy rants. If you support all that trading theory is not my preoblem. I think it is just stupid.
Yeah, I see that Mr Gone is sometimes very rude but I think he is honest…and I like honest people even if they are rude! Do you have something to say about the topic of this trend?
Yo d-pip, we’ve gotten along pretty well in the past, but I don’t think what Mr. Gone is getting @ here is crazy or foolish.
I’m not defending him, I’m just injecting my opinion regarding his claim that most retailers get in late.
This is pretty much a proven fact.
Read any book about how institutions and professionals trade, and you’ll constantly see this notion mentioned across the board.
The vast majority of retailers don’t have the confidence or emotional strength to trade proactively- instead, they await for the stars to align before finally getting in @ an exhaustive rally @ the absolute peak of a move culminating in a weak hand. In other words, the fear of missing out on a trade compels them to buy into a rally which has no underlying professional support.
They’ll hold onto that position in hopes of it “turning around” to the tune of 2x longer than their average holding period for a trade which has moved for them. Not sure if you’ve ever seen this study, but this supports that idea: Source.
I actually just finished Wyckoff’s “my secrets of day trading in stocks” (written in the early 1900’s), and he talks about this exact notion. It still plays out today in every market as illustrated in (to name a few) some books I’ve read recently from Anna Coulling, Tom Williams and countless Sam Seiden and other S/D traders’ articles: the concept is well-received and still well-known within professional context.
I’m not saying that the professionals out there are “out” to get a retailers $12.00 stop loss order.
What I am saying is that market dynamics have rarely changed from 100 years ago, and rarely will change as we progress forward and trading becomes more popular and easily accessible to the masses.
Professionals will always be selling to retailers @ retail prices, and buying from them @ wholesale prices.
The retail aspect of trading is just one mere piece of the immensely complex puzzle (I know you know this).
I just focus on it so heavily because the majority of people on this forum are indeed new, and, continuously make the same mistakes.
For four years I strongly believed in indicators, today I make money with fundamentals, not because I think they work, au contraire I make money because I can exploit some ideas when GDP points in one direction but price goes the other way. From my experience I have learned that when all the indicators are green it is the worst time to buy.
Sivricmarijan,
Yes, I pay a lot of attention to trends, bullish higher highs / higher lows and bearish lower lows / lower highs.
Here’s a cut and paste from a January 10th 2011 post from the 301 Moved Permanently thread. Pretty much describes the concept behind most of my trading.
LOL! Go through and read a bunch of his past posts, actually go back and read everything he has posted for the 12 to 18 months. :17:
Have you read anything written by or about Michael Covel, Ed Seykota, Richard Donchian, Jesse Livermore?
.
I can honestly care less what he posts
He just mentioned something which caught my eye and I felt like adding my opinion.
Jake, see you have been reading Wyckoff, his other book on tape reading is also brilliant.
Wyckoff was motivated by his experience of seeing ordinary people lose in the market, he used to extoll brokers to provide education - they laughed at him - hence his prolific magazine writings.
Another great book is Livermore’s ‘How to trade in stocks’ written just before his untimely death.
One of his little gems was his two stops, one was points (pips) based as per normal, but his second was TIME, he reckoned if a trader felt ‘hope’ in his trade, i.e it was going nowhere over a few days - therefore in would creep hope - and out would go Mr Livermore.
Yup- I really enjoyed the book.
It was really fascinating for me to see how the principles he was trying to educate the masses on over 100 years ago, are still prevalent today- just re-packaged a bit. In all honesty, nothing has really changed in the markets except for accessibility. The same underlying principles of supply and demand still drive every asset class.
I loved how the text shows legit images of the tape from the 1900’s and live examples of how he traded “Union” and “US Steel”- relics of American Capitalism.
I’ll have to look more into Livermore- his texts are my next topic of interest. Especially, Reminiscences…can’t wait to get my hands on this one.
Trading harmonic patterns I very often see good opportunities to trade against the trend (usually short term corrections) … it depends how you look at it though, because if I trade a correction on the daily chart, on the 15 mins chart the price would have trended in the direction I was trading (if the trade worked out).
It is more profitable to trade with the trend since you have the wind at your back and you may have a bit of a higher win rate, also you, depending on your style you may have the option to run the trade and get a bigger RR ratio.
Thanks people for giving me interesting information. Do you have more good resources, books, ideas…?
Ari Kiev. His books will open your mind.
I changed my mindset from trading with the ‘trend’ to trading with the ‘strength’… Checkout videos on youtube by a guy called PeteFader, and read “Master the Markets - Tom Williams”… well worth it imo.
Thanks Mr Gone! Which one of his books would you recommend for start? All of them?
Trading in the ZOne (Quite different from the Mark Douglass of the same title)
Trading to Win
Also I recommend you Super Trader and Master Traders from Van THorpe