I digress. Too much information. I recommend 4hr and 1hr. Less detail more evident.
Trend Following is not popular because it takes a lot of patience with long periods of doing basically nothing. One way to get over the itch to overtrade is to trade like mad. One can trade until you are so sick of trading “that the mere sight of it will make you wanna throw up.”
I don’t expect anyone to trade like a pro from the beginning. The first thing a trader should do is overtrade, pick tops and bottoms, blow up. Then, when they have satisfied their curiosity and their itch to get into the game aggressively, they can be clear-headed and trade with purpose.
[QUOTE=Arbitrager on Acid;684324]Trend Following is not popular because it takes a lot of patience with long periods of doing basically nothing…
That’s why there are Scalpers, Swing Traders, Day Traders and Trend Following Traders… Trading is personal preferences… the way you do it is totally discretionary.
Aus/nzd basically never been this low I’m in long ride this out for Atleast 2000 pips.
As always, comments are welcomed and encouraged. Cheers!
Rayner
Hi Rayner,
Thanks for the post. As usual awesome post.
by the way , do you trail your stop loss ( 2 * ATR ) when it goes to your favour ?
Would appreciate if you post a video on stop loss
Thanks for your time.
Let me know if this helps godzilla
Rayner
Rayner,
I heard Jerry Parker tell Niels Kaastrup Larson that he uses a minimum ATR. When the ATR is below that minimum, he sets the position size and stop distance according to the minimum and not the actual ATR. This is to avoid putting on too big a position or too tight a stop. Have you heard of this? Considered this? Do you do this?
May the forx be with you.
Thanks Rayner,
That video is about setting stop loss . I wanted to know do you trail profits with stop loss ? if so how do you do it ?
Hey acid,
I don’t consider such position sizing approach. I simply set it as 2 ATR and keep it constant through out.
The wider your stops the small your position size which leads to a poorer risk to reward, but at a higher winning %. Likewise a small stop will lead to a larger position which leads to a better risk to reward, but at a lower winning %.
Rayner
Hi godzilla,
I do trail with moving average or structure. It depends on the context of the market.
If you watch my crude oil trade, i was trailing with moving average for that trade.
And here’s another example of trailing with moving average on usdjpy
Rayner
Yes I understand how the use of ATR effects position sizes and risk. But are you familiar with this idea of a minimum ATR? Or a minimum volatility measurement? Are you familiar with Jerry Parker and his firm?
Check out the interview I am talking about. Fast forward to about 14:50 to hear JP talk about the effect of his use of this feature in his implementation on his risks within the context of the SNB move last month.
I’ve heard of Jerry parker as his a trend follower, and nothing more.
I’ll check out the video, thanks!
Rayner
so you use 2 * ATR as initial stop loss after placing order ? Do you move stops to break even as soon as it goes in your favor ?
No problem. While you are at it, check out the rest of Niels Kaastrup Larsen’s toptradersunplugged podcasts. Niels is awesome. He is a trendfollowing CTA that worked for Jerry Parker and Bill Dunn. His guests are mainly trend followers and some of the specifics they get into are mind blowing. I am super stoked on Scot Billington’s interviews right now. He has an article in the Feb issue of Future’s magazine that had me dying on the floor of Barnes and Noble last week. Love it.
Let me know what you think of that interview and of Niels’ podcast. I assume you must already listen to Mike Covel’s podcast.
Hey acid!
Awesome podcast, I loved it and thanks for sharing!
With regards to your earlier question, i thought the minimum atr was brilliant. The reasoned he used it is from a risk management perspective as the eurchf volatility is currently at multi year lows. Thus going by the standard ATR approach, he would be risking too large a position size.
So what he did was to increase the ATR and accept a smaller position size instead, so if suddenly the chf currency gets illiquid or he face slippage, it would keep his risk in check.
I thought it was a good point and thank you once again. I’m not much of a podcast fan actually, but since you mention it perhaps i should start listening more.
Cheers!
Rayner
Hi godzilla,
No i don’t. I typically don’t shift it till i get at least a 3R in open profits. By then market would have make a new structure high/low of the moving average would have caught up, then i can decide to manage my trade accordingly.
Rayner
Niels’ podcast and Michael Covel’s podcasts are nothing but trend following from the top CTAs. Have you read Covel’s books? The Complete Turtle Trader, Trend Commandments, Trend Following. All good. Covel is the ultimate spokesman for the CTA space. If you need a pdf of Trend Following it is here
The Turtle Trader is here
Cheers fosho!
I think even Donchian used a certain minimum price range in his most basic system. I actually like his system even more than Seykota’s or Dennis’s for the reason of simplicity and elegance. Niels asked Billington if he thought a moving average system was better or worse than a breakout system and he answered neither! Ha! I have suspected that is the case. Nobody can beat Donchian’s system!
You know Billington’s program did an 84% return in the month of September 2014 alone?!?! The program is full-on old school Rich Dennis style Trend Following. Trend Following will never die. It truly is the most antifragile approach
Yes i’ve read alot of materials on trend following, books, research papers, videos etc.
Just didn’t thought of looking at the podcasting… which is something i clearly missed!
Rayner