Newbie with question about downtrends

Hello all you FX masters. Im new with Forex and trying to learn as much as possible before I jump in head first. Ive been studying with the school of pipology and everything has been going great except I keep getting turned around when something doesn’t make sense. To my understanding so far, that downtrends are not a good thing, but then Ill read something that is along the lines of “Downtrend of 300 pips, YAY!” then I say, wait… isn’t that bad? and It makes me rethink everything Ive learned! Am I wrong or missing’ something?:frowning:

In my opinion this down trend will continue for certain time. and you need proper strategy to take benefit of this downtrend. in my opinion Downtrend of 300 pips is not that much, I have seen worst then this.


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I think it is all depending on your strategy. Some traders go for trend following, while some are trading range market. So for those who are happy for the downtrend of 300 pips, they must be trading on the trend.

If you are Buying you want price to go up, if you are selling you want the price to go down.
so if you are long(buying) a down trend would be bad , but if you are selling (short) a down trend is good!

This is extremely basic stuff so im not going to write a 1000 word thread like i ussually do.

It doesnt matter if its up or down it only depends on your strategy.

For me trading support and resistance, swing highs and lows, and charting formations i don’t care what the market is doing. I do not trade up or down trends. I trade my method. Get it??? I do not trade the EUR/USD, EUR/JPY, USDJPY, AUDUSD they are only used for me to inject my capital into. What i actually trade is my method!

Right now i shorted the AUDNZD at a major support level and i’m cleaning up on this trade.

If a major support level is broken i am not going to say “o im not trading it because its a down trend”

The mere fact that you even said it is a down trend is a good observation so you should probably looking for a down movement based on your strategy or method.

Indeed, it entirely depends on the trading style of the individual trader. One of my most lucrative trading periods was last year before the SNB and BoJ intervened - USD/CHF and SGD/USD were in a sustained downtrend and for those trading a trend-following strategy it was simple stuff to back the trend and make a great return. Trading a range is different, scalping is different, all sorts of other approaches are different.

For me, it makes sense either to have a strategy that is good at one type of market, then wait for that type of market to occur and then trade it heavily and make your money, or otherwise to have a number of different aspects to your style and know which one to use in any given market.

But it is certainly not true to say that a downtrend is a bad thing from any abstract perspective.

ST

Back to the books I go. :15: I sound dumb, because well IAM when it comes to this stuff. I didn’t even know you could sell if you weren’t already in a buy position. Im super new, but now I know I have WAY more to learn.

For Newbie i will say do not be in a hurry for either learning or trading in the Real accounts. You must take your own time and have some patience which is what will see you through.

in language, down has a negative connatation. in forex u need to forget that (because u can trade short as easily as long).

a simplified example, with EUR/USD an up trend means basically that euro is going up and dollar is going down. a down trend is the opposite

but imagine what the EUR/USD chart would look like if you flipped it upside down. it would now be a USD/EUR chart. what was a down trend in the original chart would now be an uptrend. in both charts the USD is getting stronger and the EUR weaker.