First I place my stops a few ticks off the natural reoccurring support and resistance oscillations that my constant (capped) volume bar charts create. Time based charts have a tendency to produce more choppy idiosyncratic price moves which will stop you out more than keep you in. One of the things I've found is that if you are using volume bar charting the oscillations are smoother and I'm rarely stopped out. Remember I'm not entering trades during consolidation either which drastically increases risk.
I'm definitely a trend follower. It's important to realise that weak, choppy trends are rarely profitable for trend following systems because of the open position management algorithms that get you out of the trend if it starts to reverse. They can lead to a lot of stops being hit in a row. We tend to like trends that a fairly straight up or down
Too late for me...I signed up for Jack Hershey's class after his "fractal this...deductive that" post. I'm just waitin' for the millions to roll in.
I believe that your painting with to broad a brush. Not everyone is trading with the same methodologies. Not all use the same tools or trade the same markets. There are also various time frames from with which to trade. So a 5 min chart might be trending and a daily chart is not. Its all relative. Your statement is not really clear. The title of the thread is "Trendfollowers" but yet you seem to be speaking about yourself? It would appear that you have not managed to make $$$ for the past 18 months? If this is the case might I ask "why"? Why have you not made money when the Sp 500 has been trending both up and down during the past 18 months. Are you day trading? are you swing trading? what time frame are you trading? what markets are you trading? are you just winging it or are you using a proven system with a proven track record? are you utilizing sound money management techniques that include stop-losses and profit targets? Without some more info it will be impossible to assist you. Please explain further. Be encouraged
If you don't have the ability or where-with-all to create charts on your own to see and validate, personally, whether suggestions or opinions in an open forum, suit your style of trading or not, then simply turn the channel. Commenting on those simple type of things which are obviously outside your comfort level & outside your level of experience does a total disservice to you. Maybe.
Let's see; you and Jack both walk on 2 legs, have hair on your body, breath air . . . hell, you must be Jack Hershey. I love the posters that broadcast their intelligence in their posts. If you aren't bright enough to test ANY strategy on your own before you spend a penny of your hard earned money on educational information . . . you shouldn't be allowed to open a brokerage account.
Quite lately I've had a large number of my trades show a decent profit, come very close to my target, sometimes just a few ticks, then reverse to break even. I'm about to become a scalper again. $200 here and there all day adds up! Patiently trying to catch a big winner is producing diddly squat.
lol, who does not. Fact is around 95% of the times markets dont move straight up or down. Another fact is that if you did not make money in 2008 and 2009 based on the plentiful trends then you a) either dont have skills to trend trade, b) made some big errors, c) are not a trend trader. It does not get better in terms of trendiness. I rather expect a lot of reversals and slow grinds up or down over the summer months unless Europe is going down the hill again earlier than I expect.
My experience is that markets never purely trade based on technicals nor fundamentals, alone. I am most successful tuning my model that is based on pure price action to fit the fundamental environment we are in. A lot of guys who are trained engineers or CS type of people search for the holy grail expecting they can tame the market with their perfectionist mind sets. They believe a fully automated trading model is the pinnacle of what can be achieved. I beg to disagree. I have not seen anyone who struck it rich on the back of a fully automated system (but then I also have never met Jim Simons, but how many of his kind are out there?). However, there are countless successful traders who utilize technology to serve their approach to trading trends. They dont trend trade in one environment and become faders in another environment. They know when to sit on their hands and when to push size because the markets are telling them. They make discretionary adjustments to their models but they dont change their whole trading style, at least I have seen this happening only very rarely. My point is this: Just because currently markets are not exhibiting trending properties does not mean they wont trend again. We just came out of a multi day basing pattern after a huge multi week sell-off, with flash-crash in between, BP, less liquidity in the markets partly due to the World Cup, and daily political intervention from Europe. Those are all fundamental factors yet they directly impact prices and price moves, however, not in the way on which your models were tested and calibrated. There is nothing wrong with intervening in your model in a sense to tweak leverage multiples, because it does not directly affect the algorithms but merely how much skin you want to have in the market. I simple reduce when we start basing, which lowers my losses in whipsaw market environments, though I may miss being fully exposed in case the trend continues without correction. I always trade from a defensive mindset, protecting trading capital is the absolute highest priority for me. There are times when to stick it all out and there are times when its better to reduce, and a trend following system CANNOT TELL YOU THAT. Only a trained mindset to listen to the fundamental data will enable you to successfully adjust. And excellent example is BP. It was an excellent trade and I captured some early on (but got out way too early). Why did I get out even though the trend was unbroken at that time? Because the more politicians entered the game the more BP prices turned into a pure coin flip. In the past 2 weeks prices could have gone up or down 10%. (and they sometimes did). This is not the type of environment I thrive in. The edge was early on and I played it, and I simply move on to other names. Same with the broad market. When we move into a basing pattern there is nothing you can predict to happen anymore at least not with statistical conviction. Whats the point to stay fully exposed to a market that with very high probability will begin to whipsaw. Adjust your models but dont change your whole approach to the markets, I guess, is what I am trying to say.
Sorry I'm not Jack. All reputable posters in this forum know who I am, most have my email, some have my phone number and those that have asked have tested my method freely but you definately don't fall into any part of these groups.