every time the market wiggles there is a trend created..even sideways............some short, some long
"We know that prices move up and down. They always have and they always will. My theory is that behind these major movements is an irresistible force. That is all one needs to know. It is not well to be too curious about all the reasons behind price movements. You risk the danger of clouding your mind with non-essentials. Just recognize that the movement is there and take advantage of it by steering your speculative ship along with the tide. Do not argue with the condition, and most of all, do not try to combat it."- Jesse Livermore (Now someone is going to go off on a tangent about if Livermore had a screw lose or whatever, but that is not the point). Note that Livermore does NOT say he can predict trend, that he knows in advance where it will END... he knows very well that he does not need to. All he needs to know that a move has started and that it will last until it ends. He wants to be along for the ride. All that he and many other guys who made fortunes did was find a way to identify that a Move has started and then ride it until their criteria told them that it was over. Period. And you seriously want to tell them that they could not have made fortunes or that it was all luck? That coin-flip thing never made any common sense whatsoever to me. If a testing lab can not find trends, they should throw out their tests and start again: that is like saying a surfer could not surf because he can not predict how long the wave will last., or a sailor could not sail since he is not sure the wind will continue... He does not need to! All he needs to do is sit there with his board or boat and wait for a good wave or a breeze. Then he rides it. Does he need to get on the wave when it begins, out in the middle of the ocean? NO! Does he need to know where the wave ends when he gets in? NO! The wave will TELL him when it is time to get out. The wave will show signs that it is breaking, and he will exit! ... kind of funny to hear this kind of argument from someone with a name like marketsurfer
I'm not trying to start an argument with you. I just want you to understand that your particular DEFINITION of Trend Following is ONLY ONE variation of the concept. That PARTICULAR book defines a PARTICULAR & PERSONAL definition of Trend following. It is not the definitive word on trend following. " . . . it defines [HIS VERSION OF] trend following" That's like saying the only "Potato Salad" that is viable is the one your Mother made because it is what you are familiar with. Everyone else's Potato Salad" can't be worth eating because your Mother didn't make it. Makes no sense. No bone needed, you stated exactly what I expected you to state. If you understand that concept, there may be some hope.
vienna, these are lovely platitudes and no doubt make sense to someone without long term market experience. however, the examples you provide are not applicable to the markets in most cases. is your last initial C. by any chance?? surfer
yes, i agree with you, for the most part. my primary concern is with the definition and methods described in the book mentioned. surfer
As the Market wiggles, those wiggles are either oscillations continuing in the existing trend, oscillations consolidating in the existing trend or oscillations creating a breakout of the existing trend, depending on the specific chart increment you are watching. Price can not do anything else. The smaller the chart increment you watch, the more noise and less clarity one sees from intraday, swing or position trends.
I agree with your comment Vienna: Of course my own experience is quite limited. It will be 12 years this Christmas, and in the big scheme of things that is nothing. I like your sailboat analogy as well. I have an old Mariner (50 feet of real wood and teak rails, no "poptops" for me) and even though it has a small engine (Volvo Diesal) I kind of like to wing it, anticipating that the winds that have always been friendly in the past will continue to move me through the water. Here on the west coast I have participated in five Whitney series (offshore) races and never once been stranded for lack of it. Good sailing to you, Steve
once again, charlie, your observations are correct. however, to claim that you can profit on 90% plus of your entries is where my issue lies with your claims. perhaps i'll change my mind in march once i see the objective test results..... but i doubt it!