You subscribe to the belief that markets are random, that is your problem. So if they are random, then no matter what you do you wouldn't be able to derive logic from price action.
Here is an example from today. Disclaimer-I missed this trade first the 15 min chart of M, it breaks out above yesterdays high, don't want fade that move.
Now here is the 1 min. We have already seen it hold this level once, so the next time around we can fade it if we want, with a stoploss below that last low it made. There were a few good opportunities here.
Monthly chart is King Cobra, always look for lower time frames to align with the monthly chart, whatever method you use. Alignment of multiple time frames strengthens probabilities. Looking at equity index's monthly chart, they are bearish, so look out for an alignment.
Guys thanks for reviving my old article. It was actually interesting to re-read my own words from a few years back. Ironically enough I prefer to trade WITH the trend, mainly because the old adage from physics that once in motion an object will continue in motion unless counteracted by an opposite force holds true in the markets. That is ALL THINGS BEING EQUAL and granted that's a big assumption once trending price will move in the direction of the trend. Fading however can be very effective as many of the traders in my Millionaire Traders book have shown, and in fact when I talk to my prop trader friends on bank desks they primarily fade flow, but in FX where you have to overcome spread I think that's a difficult task for a retail trader to accomplish. Ultimately the more I trade the more I have come believe that 99% of all trading is fundamentally driven and these days I trade primarily off news but I try to stay on the side of the trend as much as I can
Sometimes follow a trend; Sometimes fade a trend; Sometimes forecast a trend; Sometimes there is no trend; Sometimes a trend is a good friend; Sometimes a trend is a bad friend; Sometimes just trade some of the trends!
Of course that was more of a flag here is an example of fading a steep move, at the 78% fib, which is about as deep as you would ever expect it to retrace.
i've been a bottom/top picker forever,contrarian by nature so th at's how i trade,trick is to recognize a trend day,these are the days that a contrarian gives back,today was only 3 to 1 so the size of that percentage imbalance is unreliable,i've found that if you put up a comparison chart,uvol/dvol, it becomes self explanatory,it will be very steep on a trend day, a confirmation, and start to curl, or flatten,when trend is faltering, and it gives you confirmation that it will stop at or near your projected fib,tl or whatever support or resistance you've predetermined
Here is a great example of a volume exaustion fade. Note how it breaks its down trendline in a downtrend on extreme volume. You could be in the circle expecting that area to hold. There was a long thread on here about this style of trading I use it when I see this sort of volume blowoff and it works pretty well. I forget the name of the thread.