nothing wrong about bottom picking and top short sale!
top and bottom produce the best profitable trade. yes it is hard to predict top and bottom,but worth doing that.
if you donot use margin, when index drop big, buy, maybe a little early,but often near the bottom or around there. common sense should prevail.
whether you are counter-trend trading or not, as a matter of fact, when you enter, you really do not know you are in the right direction or not, only time tells. often you see a trend, think you are smart and jump in the direction of the trend, but the market changes its direction just as you jump in.you try to followthe trend, but it is impossible because of the trend uncertainity!
any trade which produce loss is counter-trend trade. any trade which produces profit is trend following trade. the only way to make profit is in the direction of the market.
you can not avoid counter-trend trading, since the market's trend is uncertain or not clearly defined for you.
if everything is so clear,we all do not need trade, no one can make money. the uncertainity creates opportunity and traps, that is why someone can make money, why others lose.
Quote from Trader.Fighter:
I enjoy reading trader's psychology in public forums, not just this one, but others across "The Net". Watching how traders think and act, watching them get trapped, then enter a phase of denial by adding to positions doing very poorly because the trend just kept going.
One thing that has surprised me all along is the need to call bottoms in downtrends or the opposite, calling tops in uptrends.
The need to predict the change of a trend without an ounce of confirmation. Not just occasionally but some have adopted it as a dominant trading style. Is there a relation between this and vast majority of traders losing ?
Is it a trading disease or an addiction ?
It's certainly something harmful and during my early years of trading I recognized it as a cancer in my trading, one I had to eradicate to succeed.
On a different level, should counter-trend signals be used to exit trend positions ? Should they be ignored ? Should they be taken and reverse back when the trend have identified the counter-trend signal as clear trap ?
Not trying to disrespect anyone, just trying to start an adult discussion on the matter.
Best wishes and please discuss.