A trending market is one in which the overall direction of the currency pair is moving up or down. Regardless of how one defines it, the goal of trend trading is the same - join the move early and hold the position until the trend reverses!
The basic mindset of trend trader is "Am I right or am I out?" The implied bet all trend traders make is that price will continue in its present direction. If it doesn't there is little reason to hold onto the trade. Therefore, trend traders typically trade with tight stops and often make many probative forays into the market in order to make the right entry. Trends can be thought of in varying lengths including short, intermediate and long term. If one can identify a trend, it can be highly profitable.
When does this system do well and when will it not?
The medium-term trend follower needs a clear market direction or wide ranges to produce positive results. If the market is not trending, numerous false signals are to be expected. The medium term trend follower portfolio will lose consistently until market volatility increases or until a new trend appears. Few trades are winners but an exceptionally high reward-to-risk ratio allows the portfolio to stay ahead long term.
How are signals generated?
This system is based on the Donchian channel system. The system will buy when the high of the day penetrates the high of a number of bars back and will sell when the low of the day penetrates the low of a number of bars back. The portfolio automatically assesses market conditions every hour.
Is the medium-term trend follower for me?
The M-T trend follower is for active traders that can sit on losses for weeks. The M-T trend follower follows the market regularly (at least a couple of hours per day).
| 8 Model Portfolios to choose from Trend, Range-Bound, Volatility, and Swing Traders! |
| |
| |
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
| |
|
|
|
|
| |
Risk Disclosure: Trading in foreign exchange and futures is speculative and may involve the loss of principal; therefore, funds placed under management should be risk capital funds that if lost will not significantly affect one’s personal financial well being. This is not a solicitation to invest and you should carefully consider your financial situation as to the suitability to your situation prior to making any investment or entering into any transaction.
The trading systems herein described have been developed for sophisticated traders who fully understand the nature and the scope of the risks that are associated with forex trading. Should you decide to trade any or all of these systems' signals, it is your decision.
No representation is being made that following a system's suggested signals will necessarily lead to profit. Investors may incur into a series of consecutive losses and substantial equity-draw-downs that can deplete their funds before the occurrence of any meaningful profit accumulation. |
| |
