The key to making money trading is to stay ahead of the herd /majority. However, I find most books teach strategies for chart reading that are more or less the same. Those chart reading techniques are what the majority follow. You can't be doing what the "majority" are doing and expect to make money trading. Therefore I would love to hear what you do to stay ahead of the herd. The devil is in the details.
No two people trade the same no less in herds. Develop your own edge and trade it with discipline and don't concern yourself with "herds".
I always stay just a little behind the big boys. Where are the big boys ? Just look at the charts. If the big boys charge up, I want to be a step behind them. If the big boys dive down, I also want to be a step behind them. Do not go against the wish of the big boys.
Keep in mind, at times you just want to be part of the herd in strong trending markets. But I know what you're saying -- you can't just use commonly known strategies and expect to be successful. I actually did a presentation at Bloomberg in NY for the MTA (now the CMT Institute) called "Beyond Edwards and Magee," the underlying premise of which was pretty much what you just said -- you can't just use the stuff that everyone knows. In the markets, what everyone knows is usually worthless, whether it's information or indicators. Along these lines, I always remember something Don Worden once said in his "Trader's Manifesto" -- he basically said you should read the Edwards and Magee book to know the patterns because the real pros constantly take money from the folks who trust those patterns. That always stuck with me. Also, there are some other "big names" in technical analysis who at one time or another were portfolio managers and did not have much success. Many technical analysis gurus just tell you what the market is doing -- they are not very good at anticipating the next move. Also, keep in mind that technical analysis folks are not immune from biases are false assumptions / beliefs about the markets and their analysis. So the bottom line is that I do believe you need to be doing something unique to have a real edge. Accordingly, a lot of the indicators that I use are not that common, but one of the keys (and challenges) is the "syntax" -- how you put various indicators together to be able to have a workable strategy that provides an edge.
The herd does not study, do research or work hard. That's why they are the herd!! They chase prices, buy on recommendations, tips, rumors, news, gut feeling and the like. All books are not the same. There are text books and there are the equivalent of comic books that teach TA. And even those who do read a textbook go through it once and then "OK! Now I've got it!! Let the trading begin!!". They wind up with a half-ass knowledge at best. The majority is the herd. If you want to avoid being part of the herd, study, do research, and work hard. There's no way around it, and it should take years, which is too long for the herd to wait!! So until you have done what it takes to join those who have made it, consider yourself to be in the herd.
There is no secret to staying ahead of the market herd -- you just have to take the necessary Risks/gains, and have the skill and experience and mindset to execute/time/manage those trades. You won't get ahead of the herd, or market, by being diversified in stocks...or using that 2% of account per trade rule. You have to trade aggressively, yet calmly and skillfully. The power of compounding...it's the 8'th Wonder of the World. Trade to be Elite. don't trade to just be average or have safe/tiny gains. Good luck on refining and polishing your crystal ball. Because that's everything. Think like a combined hippy gypsy and war general. Trading is complex. It's not enough to simply say the Herd is wrong. On the contrary, I think the herd is right. But they can still fail, and most do. Most traders are like amateur bank robbers or thieves who fail to plan, and get experienced and wise and sober and control their emotions and other variables. The best way to learn about this stuff is to speak with a successful trader. But just like the trading world, the online world, has 99% of people who are full of stuff -- or couldn't make a profitable trade if their life depended on it. There's only one game in town, as far as I'm concerned. -- and that's being able to predict/trade/manage the S&P 500, SPY, daily. and compound that. options/leverage/futures on that. that's essentially nuclear fission of trading.
These people who you described make up what percent of the volume on the stock market? I know such people do exist but their impact on the markets is negligible so I don't consider them the herd. I consider them non entities.
If the herd is wrong a lot of the time, then find a way to ID when the herd has entered the market and trade against them. If certain conditions support trading with the herd, then isolate those conditions and trade with the herd when those conditions are present.
If the herd wants to go north, we also go north. If the herd wants to reverse to go down, we also reverse to go down. If the herd wants to go south, we also go south. If the herd wants to reverse to go up, we also reverse to go up. If the herd is confused and don't know whether to go north or south, we leave the herd and let the herd sort things out on their own.