There is a substantial risk of loss associated with trading Derivatives . Losses can and will occur. My methods will not ensure profits

Friday, June 15, 2012

Trends


" Trade the Trend"., "Trend is your Friend". Every trader might have read it a thousand times. But unfortunately nobody knows what a trend is,where a trend starts and where it ends.Many traders think a trend starts when price breaks out of a range. Wrong. They are going to miss most of the trend move

 Trend is nothing but a prolonged movement of price in a particular direction.If you approach the market as if it is ranging all the time, There is no confusion. Almost always a trend starts at a range extreme and terminates at the extreme of another probable range.In the above example you are entering at the BOF of a range extreme marked A. You expect the price to break out above the other extreme and move up to a higher trading range high marked B.This approach will help you to capture a major portion of the trend move(from A to B) and you are doing it with the lowest risk.So love the extremes.

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