You avoid the chop by not trading in the chop. Where is the chop? Well for that you need to know how to identify a trend.
No! you identify chop ,then go in once it is out of the way , because that is where most traders get killed.since at any time prices in the future are not known , nobody knows when the chop will happen ,even in counter trend , market reverse fast. A trend can only be determined in hindsight, since at any time prices in the future are not known. A trend is realized only in hindsight because while it is formed every point on it can potentially mark a top.
You miss the ENTIRE premise of profitable trading. Trading a PROPERLY identified trend puts odds in your favour. If it reverses, your stop loss takes you out. End of story. Anybody who cannot understand this should not be in the market. We can converse further should you move past this point.
I agree with you . What are the probabilities of 1)continuation 2)breakdown 3)reversal 4)end of trend at time of entry
Chop?? A trend that cannot be read, or is misread, due to a lack of ability, is what the trader calls......'Chop'. The above charts are no more chop than they are chop suey! If that can't be seen, back to TA 101.
The answer to all 4 is "a greater probability of trend continuing than not". It wouldn't be a trend if this wasn't the case. Why does this happen? Answer is supply and demand imbalance.
'chop' is a nothing more than trading range. Trading range = chop Outside of trading range = trend. It is really that simple.
so you need fundamental drivers and supply /demand imbalance , to confirm a potential move. Example :MARKET RUNNING FROM BONDS AND LOOKING FOR OTHER PLACES TO INVEST http://www.cnbc.com/2016/08/31/bill...yellen-have-mastered-market-manipulation.html