Hello everyone!
Trend following is one of the most simple technical analysis approaches but quite difficult concept to carry out in markets.
Hardest part about it is to follow a trend until it ends. Following trend is just like standing outside and waiting when it will start raining.
You know that at some point it is going to start to rain but you don't know when it precisely happens and how wet will you get.
One good way to train patience and discipline to calmly follow trend is to remove all price data from charts. To understand logic behind that
trader must understand that until trend is in force it's not important what current price is. It's not important what it was 2 weeks ago as well it's
not important what price is tomorrow - until trend continues. Trader will sell only when by his/her definition trend is over i.e. sell signal is
triggered.
This is educational post and if somebody want's to try it then go ahead. I am not saying that you should always follow trend blindly. There are different
styles within trend following like scaling in & scaling out; different methods how to trail stops etc. where checking price data is necessary.
I am just pointing out one way how to train yourself if you feel some anxiety or feel stress holding positions and always want to cash out.
I added second identical chart with revealed price data and feel free to compare them and see how these charts look different.
Thanks and enjoy your trading :)
Trend following is one of the most simple technical analysis approaches but quite difficult concept to carry out in markets.
Hardest part about it is to follow a trend until it ends. Following trend is just like standing outside and waiting when it will start raining.
You know that at some point it is going to start to rain but you don't know when it precisely happens and how wet will you get.
One good way to train patience and discipline to calmly follow trend is to remove all price data from charts. To understand logic behind that
trader must understand that until trend is in force it's not important what current price is. It's not important what it was 2 weeks ago as well it's
not important what price is tomorrow - until trend continues. Trader will sell only when by his/her definition trend is over i.e. sell signal is
triggered.
This is educational post and if somebody want's to try it then go ahead. I am not saying that you should always follow trend blindly. There are different
styles within trend following like scaling in & scaling out; different methods how to trail stops etc. where checking price data is necessary.
I am just pointing out one way how to train yourself if you feel some anxiety or feel stress holding positions and always want to cash out.
I added second identical chart with revealed price data and feel free to compare them and see how these charts look different.
Thanks and enjoy your trading :)
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