Looks like I am to study reversal patterns. And do you mean classical reversal patterns or you use your own patterns?
Looks like I am to study reversal patterns. And do you mean classical reversal patterns or you use your own patterns?
dbphoenix
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Take care not to confuse "reversal" with "retracement", as the author of the quoted chapter appears to do. Otherwise, you'll find it that much more difficult to distinguish between a trend reversal and what is nothing more than a pullback in an ongoing trend.
Db
Author of this book does not distinguesh retracement with reversal, because there are certain rules for determining of retracement and reversals.
Trend is the distance between figures of reversals, there is nothing written in classical literature. Analysation of trend from different timeframes and so on.
Just in case,*there very few literature for Forex market. I suppose you were not carefull in reading
After some correspondence with that trader I’ve understood classical reversal patterns with precise criteria to identify them and one pattern of failed reversal called “the hound of Baskervilles”.
dbphoenix
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I understand that he did not distinguish between retracements and reversals. That was my point. As for there being nothing written in classical literature about trends and trending, there is in fact plenty. You could start with Dow and Hamilton. As for trend literature re the Forex market, trend is trend; really doesn't matter what the market is.
Db
Yes, I’ve tried to use trendlines, but there are difficulties with trendlines too. How many highs or lows to use when drawing a trendline? What if the slope of the trend changes?
So how to draw them?
TheBramble
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Some folk manage with two touches, others with three. Some use the lows (for an uptrand) and the highs (for a down trend) while some just use the close for both.
What do you do when the slope changes? Great question. You've identified a change in the trend. You can either treat it as a breakout if it's appropriate to do so, or you can prepare to start drawing a new trendline. As an aside, in an uptrend, with a slope at 45 degrees or thereabouts (1:1 time and price), the move to a 60 degree slope (increase in slope) often portends the blowoff phase and a break (down) through this trendline is often a very useful indicator of failure of this accelerated phase of market action and a good place to exit longs. Just a thought.
Yes, I’ve tried to use trendlines, but there are difficulties with trendlines too. How many highs or lows to use when drawing a trendline? What if the slope of the trend changes?
So how to draw them?
The trouble with different kinds of trends is also solved by that experienced trader. He uses complex analysis of different kinds of trends together.
Grey1
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The best way to identify trend is on higher time frames. Trends developes either because of the news or techncial merits.. Forget about the news because you can never get ahead if it which only leaves you with techncial merits... SO if your instrument is OB or OS and at extremes on the higher time frame then you get trend on lower time frame ,,,
Grey1
Trend on any market is trend. But on Forex market there is one intresting situation instead of other markets here, trend is changing very fast, here is no figures of reversals like round top and etc. Because everything is going very fast and just simple retracement is becoming a new wave of trend. And all is depending from TimeFrame also. While on one TF it can be trand, on other it can be simple retracement.
And would you tell, how many kinds of trends does he distinguish?
nine
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Its probably important to realise that the so called "experienced trader" is another eastern block scammer. Follow that path and its promoters to loss of money and disappointment.
If you really want to understand markets and their trending and non-trending behaviour you'd do far worse than to abandon et and try and learn from the material dbphoenix provides here for free.
Alternatively you could follow an index trader on another site . The same stuff works in forex or futures. Markets are just collections of people and people programmed machines that buy and sell.
If you really want to understand markets and their trending and non-trending behaviour you'd do far worse than to abandon et and try and learn from the material dbphoenix provides here for free.
Alternatively you could follow an index trader on another site . The same stuff works in forex or futures. Markets are just collections of people and people programmed machines that buy and sell.
Maybe man is from the eastern block, but sense is not changing from that. Forex is without faces and nationalities. And everybody has its own trading method. And he exactly not showing losses and dissapointment, if it was there were nothing. The site i gave I was showing 2 his books, all free and shown problems which classic literature authors did not solve and i think you also did not solve it. Thanks for link I gonna rewiev it. Regards
Let the market guide you
It's simplistic but equally frustrating. A trend is a trend when it exbihits the characterstics of a trend and, more importantly, continues and adds to these characteristics. It ceases to be a trend when it no longer exhibits these characterstics and its end is characterised by a lower frequency of exhbibition of these characteristics.
The point is that a trend is different to, say, a breakout or a reversal, which happens at a more defined point in time. It develops. You must give it time to develop and to reveal itself given the extent of your knowledge and experience at this time.
So be prepared to follow it and gain from it, but not necessarily the full extent of the trend. If you profit that is sufficient, but if your lose by not giving it a chance to develop then clearly you have lost by your "invention" of a trend too early or where a trend fails to exist. Let the market tell you when to enter.
Charlton
It's simplistic but equally frustrating. A trend is a trend when it exbihits the characterstics of a trend and, more importantly, continues and adds to these characteristics. It ceases to be a trend when it no longer exhibits these characterstics and its end is characterised by a lower frequency of exhbibition of these characteristics.
The point is that a trend is different to, say, a breakout or a reversal, which happens at a more defined point in time. It develops. You must give it time to develop and to reveal itself given the extent of your knowledge and experience at this time.
So be prepared to follow it and gain from it, but not necessarily the full extent of the trend. If you profit that is sufficient, but if your lose by not giving it a chance to develop then clearly you have lost by your "invention" of a trend too early or where a trend fails to exist. Let the market tell you when to enter.
Charlton
