That is how Dunn Capital trades too. Very proven.
-Adrian
I’m not so much of a mechanical trader per se.
But definitely a trend follower at heart as my trading plan revolves around the core principles of trned following.
But it’s always great to see a fellow trend follower around.
Because only a fellow trend follower would know what it takes to be one.
Rayner
Thanks, Trayner. I did not start out as either a trend follower or mechanical trader per se. But eventually 2 things became obvious: my best successes came from positions that I held for a long time (thus taking advantage of long term trends), and I was utterly incapable of knowing WHEN to enter or exit a trade. Success happened only by luck. Eventually I saw that buying on strength and selling on weakness works – so here I am with a brain-dead method that works.
Frank
That’s how i adopted a trend following approach as well.
Held onto the trend for a long time, paid for all my small losses and put my account in the green.
Jesse livermore, Richard Dennis, Richard Donchian, Ed Seykota. All successful traders and all trend followers.
Rayner
Paul Tudor Jones
John W Henry
David Harding
Bill Dunn
The Turtles
Aside from value investing, Trend Following is the most replicated approach to markets ever.
-Adrian
Value investing… how many successful traders actually replicate what warren buffet does?
There are some things which is difficult to replicate for the retail traders… and trend following ISN’T one of them.
Rayner
Hi Rayner
I am confused at this chart (Daily)
https://www.tradingview.com/x/ichp0NG0/
Is it in a trend ? Can one go long here ? I am confused because It has broken 50 MA and 100 MA and now near to 200 MA…so I’m worried whether one should choose or discard this stock for trend following .
also it looks to me it has broken structure (is it ?). …I am confused what should one do here.
Should I keep on looking for trading opportunity for going long in this chart or should I discard this stock ?
Please comment.
Thanks
Hi godzilla,
The reason you are confused is because you need to first define a trend.
Once you have define it, you follow your per definition of whether price is still in a trend and trade accordingly.
Since you are looking at moving average, you can consider assuming the trend is up if price is above X moving average. There’s no fix rule to say that it is the best method, but it’s a decent filter.
After you have the trend on your side, you want to know the relative strength of the markets to choose the best market to trade.
Rayner
An interesting thread and the comments, well, sure sheds a light on trends…thanks Rayner…
You’re welcome Fxmall!
Hope you find it useful in one way or another 
Rayner
This week I share with you what are the different ways you can enter a trending markets, and you can decide which suits you best.
I hope you have enjoyed this week’s market analysis. As always, comments are welcomed and encouraged. Cheers!
Rayner
I love that mentality. You’ve changed my trading psychology forever!! Big thumbs up.
So it appears that the optimal technique is to place buy orders above resistance or sell orders below support. This way those orders are triggered only if sup/res actually breaks and are likely only stopped out on false breaks.
Hmmm…who would have thought trading could be so simple?
Excellent analysis there Rayner, It is quite easier to trade on a trending market, rather than a very volatile one.
Hi lancedes,
I hope trend following is an approach that suits you. It’s a robust trading strategy and you can tweak it to your own personality.
Let me know if you got any questions, be glad to help.
Rayner
Hey middaytrader,
Yes picking the right markets is important. Always look to long the strongest and short the weakest. They will give you the most bang for your buck.
Cheers!
Rayner
Some interesting research on trend-following over the last 100 years.
Rayner,
[B]On Daily chart[/B]
Suppose price respecting [B]between [/B]20 and 50 MA Zone and you are [B]long [/B]in the trade .
after few days …
Would you [B]exit [/B]if the price drops below 50 MA ?
I am asking because I am troubled with exit criteria. I am confused with exit part. Please throw some light on exit.
by the way , your trading course is brilliant. I enjoyed it very much. Thank you so much for the writing.
Thanks for sharing Kevin.
You may also want to check out two century of trend following by M potters.
If you want more, i’ve put together a collection of research papers here.
Cheers!
Rayner
Thanks, Kevin. Here’s another study for 200 years:
Rayner …comments please.