Looking for Trend Continuation Knowledge and more!

Trading Discussion
1

Hey Everybody,

I’m gonna jump right to my question then layout what I’m wanting to accomplish. So to start I’m looking for some resources to learn trend continuation strategies. So any suggestions or direction is much appreciated!

I’m new to trading and have been watching, listening, and reading about anything that I can find forex related. I’m really enjoying learning about everything and looking to find what style of trader I am/want to be. I know I have a tremendous amount yet to learn but I’m starting to see what things speak to me. That being said I’m at a point that I think I’m ready to move on from learning very broad aspects of the market and start looking into more specific things. I don’t have a trading plan yet, but I am seeing the rough outline of one. I’d like to share the very broad strokes of it because I believe that putting it out into the world is important.

So, very broadly, I would like to have in my trading plan, trend continuation, counter trend strategies, and advanced patterns (cypher, gartley, and bat). I feel that with these three skills I’ll be able to have a very rounded out plan. I’ll be able to trade when the market is trending and when it is ranging.

I know I don’t have the time to really focus on lower time frames, so I will look to trade on the daily, 4hour, and 1hour charts, and with some future testing maybe look into the 8hour and 6hour.

I still need to figure out what pairs I want to focus on.

From what I’ve been seeing and learning, I think trend continuation feels like the easiest thing for me to start with. Thus my question asking for resources from the community on learning more about it, in hopes of coming upon something that I can make mine and put into my plan. Once I have the skill of trend continuation, it just seems to me to make sense to add counter trend strategies so I can have more opportunities to make money. Followed by the advanced patterns I mentioned above.

This is basically how I want to continue my forex journey. As I learn about trend continuation and start seriously testing what feels right to me, that’s when I will start keeping my own spreadsheets to track my wins and losses and other pertinent information that I want to track. I will then move on to forward testing that only. Once I’m forward testing trend continuation, I’ll start looking at counter trend strategies, following the same plan I do for trend continuation, and then look at advanced patterns doing the same work.

I am not putting a time line as of yet for how long I will demo trade, but I don’t believe that I will be trading live for at least the next three months and probably longer.

Once I’m forward testing I will be looking at money/risk management, and only trading sizes that I’ll be able to trade when live.

If you’re still reading this, sorry it’s so long, but I really appreciate your time and if you have any input let me know, I’m pretty open to suggestions in order for me to learn from.

Thanks!

2 Likes
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Good luck with the trend-following, its the only trading I do.

Trends are the simplest chart patterns and the most unambiguous. They can also be objectively quantified by price movement and behaviour so you can realistically compare trends in different markets for the optimum opportunity.

Start with a picture of what the best sort of trend for you to join with would look like. You could then note its characteristics and allocate a point or points score for each characteristic. The greater the points a new trend scores, the more eager you should be to trade it. I am relaxed about specific entry patterns when I have a trend scoring 11 out of 11.

Bear in mind that trend-following has a high percentage of losing trades, so prepare for draw-down, and you might think about how to maximise the winning trends you get into, at least by how you would let them run, and possibly even by how you might pyramid them.

1 Like
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Continuation knowledge, read the road map signs I.E. candles place you S&R and have some faith in your self.

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checkout ‘The Candlestick Trading Bible’ , I’m not sure if the pdf is available online, but if not just let me know and I will post it on here. It goes over everything you need to know really, and I recommend all new traders to read it

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You may find the 3 ducks system helps you identify trends. When you’ve got the hang of it you won’t need indicators at all

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I’m looking for that pdf but not finding it available. I’d be interested in seeing that if you could.

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I read up real quick on that 3 ducks system. That actually is very similar to what I was looking at but on different time frames. I was looking at the daily, 4 hour and 1 hour chart.

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Hey! no problem. I’ll post it here for everyone later this evening after I get home

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Hey tommor, since you are a trend follower and that’s your preferred method, and I’m wanting to learn more about that what pairs couple of pairs would you say are good ones to start testing for myself? I hear talk that “this pattern trends more” or “this patterns been good for advanced patterns” but I like getting information from a lot of sources and see what keeps coming up so what do you like?

Thanks!

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No pair is better or worse for long-term trend-following but when you find a good trend you MUST get in…

So, what makes a “good” trend? The answer must relate to your strategy, there is no list of universal characteristics, but for me, e.g. an uptrend MUST have the 20EMA above the 50 and the 50EMA must be sloping upwards. After that I look at how many consecutive recent weeks have closed above the 50, how many in the last 3mths, how few times the weekly bars have been breached by the 50 in the last 3mths etc. etc. The better the score the more priority I give to getting into that trend over others.

Entry is by stop order, e.g. above the high of a bearish day in an uptrend. Stop-loss is 2 x ATR20 lower. I pyramid every at +0.5 x ATR20 and adjust lower stops accordingly.

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for some reason it’s not allowing me to post a file, not sure if I’m able to yet, but I can send it to you by email. Also, anyone else that wants a copy of this just let me know

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My recommendation would be to just master price action, with that knowledge and experience you can find opportunities everywhere on different timeframes, I have put together a step by step process video on how I have approached price action trading for years and it have worked well for me, I will put the link to my video below. Why I don’t use any indicators is because price action alone is the most up to date thing I have already, I don’t need a indicator to tell me that now its downtrend or uptrend, with price action I can spot trend change sooner than I would with indicators, not telling you the indicators are not good, they work perfectly for many people but that’s just how I approach the market.

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A simple Trend Following is to use a Double Bollinger bad (read Kathy Lien) place bot a 1% and 2% deviation on your chart. I use CCI for momentum but Stoch works well as well.

Find you entry when the price action enters the 1%-2% channel and your exit when it leaves the channel.

Remember the parent rules the child, so looking at a higher time frame will show trend and lower may confirm or not, as the child grows so does the trend from the bottom up.

Trending is all about alignment.

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thank you, get it.

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