So may be the distinction of TF with just pure price action is that in TF you never fade, whereas in pure price action trading you are open to following or fading. I suppose TF people argue that fading is a form of prediction and is a big no-no. Of course, the reality is TF is also a form of prediction -- you are predicting that the trend will persist at least in the near future.
As Handle123 stated, how you manage the trade after you enter is far more important than when / how you enter........ No prediction, just management of the trade after it is put on. You could argue that by positioning yourself for a trend after your setup, you have predicted that one will appear, but with win rates in the 40-60% range for all the profitable TF strategies I've tested, I can't see how my own predictive abilities have any power. Your experience may differ from this..... I don't know about everyone else, but what I am really doing with my entry setup is predicting a favorable R value if a trend actually appears, and also finding an abort point that is close by. It's all about risk. We're not predicting the future - we're predicting that if a trend appears, we will most likely make 2-12x our initial risk.
At the risk of starting a flame war here, I am not sure what you mean by "manage" your exit. Seems to me there is a prediction hidden under the guise of management. You are looking at the price action after entry, and you are somehow making the decision to stay in even if there is a "small" pullback, or get out. That could be systematically managed by a stop, but most here argue that you can't place a small stop, just a safety that rarely triggers to prevent absolute catastrophes. I've heard this statement over and over again that entries are less important than exits. I believe that might be true in a low commission environment where you can afford to be wrong many times. Not true for most retailers who need to minimize trades and cannot afford a low win %.
I have a question. When reading about trend following I get confused. Seems to me that people are talking past each other. Seems that some are talking trend predicting rather than trend following. A clearer expression of approach would be helpful. My idea of trend following would be "If it ain't going up. Don't buy it." or vs vs. Trend predicting on the other hand would be "This expected rise could turn out to be a trend.". My old brain is not as nimble as it once was.
It could just be that your brain is not compatible with trend following. You may find more success with a different strategy. As Intradaybill stated, it's one of the hardest strategies to use. Perhaps Price Physics or Astro Arb will appeal to your sensibilities?
I have to admit you might be right on this one. I have always been a contrarian / fader in all aspects of my life.
i'm the same way but when it comes to trading i'm a tf'er b/c i learned the hard way that fading strength/weakness was a lot harder than just following the trend. but to each his own. if you can fade and manage risk more power to you.
No flame wars here. I think we both can agree that very easy to hit the mouse and enter into a trade. Where you and I will depart is what to do now we are in the trade. I have backtested, forward tested and implemented over 30 rules on how to exit(manage) the trade. I won't say I am trying to predict what Price will do, but based on over 3000 sample size plus on each one of my exit rules, going against these "patterns of time or chart", I have less chance of making a profit or making less profit. I am a scalper, going for 1-8 tics, using a protective stop in ES market just isn't prudent, unless of course to prevent absolute catastrophes, but say at certain amount I bring stop to breakeven, being how the ES chops around as it does, I would have many more breakeven trades. And most likely where I would think bout putting in a breakeven stop be the place I should just get out. I don't recommend for average trader to scalp as it takes years to learn, and takes a very low losing % to make consistent profits to make work, and in my case I average down on all trades. For those who trend trade going for larger profits, not going in at best tic I would believe isn't going to make or break the trade. If that was true, you be only doing Momentum type trading, but what happens when you got into the top tic, now what? I am gawd aweful at trend trading, learned that early on for day trading. I found the risk to be so much greater than counter-trend, Price tends to chop much more in middle of a trend than end of a trend, ie bell curve of Market Profile(which I don't use), so in my mind long ago, find turning points that price looks like will turn on the chart and it wasn't easy. The longer I trade, the more I simple don't see trend at all, random movements that are repeative of 5-8 tic swings. I understand that doesn't make sense, but that is how I view it.