Trend, Chop and Momentum - Psychology and Money Management | futures io social day trading
futures io futures trading


Trend, Chop and Momentum
Updated: Views / Replies:4,941 / 20
Created: by George Attachments:1

Welcome to futures io.

(If you already have an account, login at the top of the page)

futures io is the largest futures trading community on the planet, with over 90,000 members. At futures io, our goal has always been and always will be to create a friendly, positive, forward-thinking community where members can openly share and discuss everything the world of trading has to offer. The community is one of the friendliest you will find on any subject, with members going out of their way to help others. Some of the primary differences between futures io and other trading sites revolve around the standards of our community. Those standards include a code of conduct for our members, as well as extremely high standards that govern which partners we do business with, and which products or services we recommend to our members.

At futures io, our focus is on quality education. No hype, gimmicks, or secret sauce. The truth is: trading is hard. To succeed, you need to surround yourself with the right support system, educational content, and trading mentors Ė all of which you can find on futures io, utilizing our social trading environment.

With futures io, you can find honest trading reviews on brokers, trading rooms, indicator packages, trading strategies, and much more. Our trading review process is highly moderated to ensure that only genuine users are allowed, so you donít need to worry about fake reviews.

We are fundamentally different than most other trading sites:
  • We are here to help. Just let us know what you need.
  • We work extremely hard to keep things positive in our community.
  • We do not tolerate rude behavior, trolling, or vendors advertising in posts.
  • We firmly believe in and encourage sharing. The holy grail is within you, we can help you find it.
  • We expect our members to participate and become a part of the community. Help yourself by helping others.

You'll need to register in order to view the content of the threads and start contributing to our community.  It's free and simple.

-- Big Mike, Site Administrator

Reply
 1  
 
Thread Tools Search this Thread
 

Trend, Chop and Momentum

  #1 (permalink)
Elite Member
Sweden
 
Futures Experience: Master
Platform: TT, NT, MetaTrader
Broker/Data: Velocity Futures, MB Trading
Favorite Futures: EUR/USD
 
George's Avatar
 
Posts: 401 since Jun 2009
Thanks: 1,005 given, 1,167 received

Trend, Chop and Momentum

Max made a request for a brainstorming in the Elite Circle. Shall we concentrate on chop or trend. Which one is more important to identify. Here are my two cents on the topic.
I'm posting here starting a thread because I believe it's important for this section as well.


I believe it has to do with, who you are! If we're thinking in probability terms, or better said let's think about trend! What is trend?

It's more or less the expression of the crowd, right? It's when you get a crowd behavior. A bit like with these indicators on this forum. In the beginning there was the double ma, now it's inside bars.

So, what is all this about? Everybody wants one, right?! Everybody wants to jump on that action, because it will reward their accounts. (It's the same thing with indicators).

Now how does this kind of behavior start? Well, someone has to move the markets right? You can't do it, I can't do it. Why? We don't have enough force to do that!
So, who's doing it? The big players!

When and why do they do it?
They do it whenever they wish to make money, or they do it when something fundamental has shown up. The last meaning that the price action achieves balance based on the fundamentals inputs.

If we are to be using indicators, they're always gone lag, because the price action is represented after it has taken place.

The same is valid during chop. You'll always be able to see chop first after it has developed. And the same is valid with trend, you're always going to see that trend has finished after it has ended.

Remember this is also valid with price action (besides indicators).

So back to the initial question, what's the best way? Undoubtedly trend. Why? Because that's where the most probable behavior of the crowd is taken place. What do I mean by that?
(By the way, I believe traders, should start looking what's behind, the price action, besides numbers and charts, and why it develops the way it does.)

Remember the two movements, (look above) that means that whenever we get those movements we got momentum. That means that people are active (why they're active deserves a thread of it's own, but we'll get into that another time).

That in itself creates a so called snow ball effect. Remember the crowd is normally dormant. Meaning that it takes a while to discover the snow ball. When it has discovered it, it jumps on.

Depending on the action, if it's artificial or not (the amount and the frequency of fundamental information is pretty low normally, that's why most of the price action movements are artificially created by the big guys in order to move the markets) we get a momentum.

If an artificial move then a small momentum, if a big then a bigger momentum. In either case we get a momentum.
Remember, we need the crowd in order to get the movement. The big guys are just starting it and ending it.

Therefor, what we need to concentrate on is to get a piece of this momentum. Just think of it, it's pretty impossible to know when this momentum will start or end. But we do know that it starts and that it ends. And we know that in order to get them we need a crowd.

Isn't it pretty ironic according to this, to see how much people sacrifice both money and time in order to find ZERO LAG indicators.

The money is where the crowd is. If you're not an investor, become a scalper and look for a toll that helps you to confirm that we got a momentum taking place. By scalper I mean that, as soon as you get your money, get the hell out of there and be happy.

My answer to the question is that we should concentrate on momentum (trend)!

/George

Reply With Quote
The following 2 users say Thank You to George for this post:
 
  #2 (permalink)
Elite Member
Las Cruces, NM
 
Futures Experience: Advanced
Platform: Tradestation, NinjaTrader
Broker/Data: TradeStation, Mirus/ZenFire
Favorite Futures: NG, Gold
 
Posts: 22 since Sep 2009
Thanks: 150 given, 53 received

I agree with what George said about trend. I believe in order to make money, we need to follow the direction of the trend. Even sometimes we may trade in a countertrend fashion, we still expect a trend, maybe on a lower timeframe, in the opposite direction of the current price action.

Whether it is more profitable trading trend or chop depends on individual personality, the market and the timeframe the trader is focusing on. I feel the equity index market is probably more suitable for counter-trend trading and I have heard people making fortune trading that way.

IMHO, the difficulty is really how to define a trend, and how to detect a trend in the early stage...just my 2 cents...

Reply With Quote
 
  #3 (permalink)
Elite Member
Sweden
 
Futures Experience: Master
Platform: TT, NT, MetaTrader
Broker/Data: Velocity Futures, MB Trading
Favorite Futures: EUR/USD
 
George's Avatar
 
Posts: 401 since Jun 2009
Thanks: 1,005 given, 1,167 received


edgefirst,

Thank you for your post. In my opinion, it is imposible to make order in that chaos (the market), and even by picking up patterns one can never do so either. Even if you call yourself Robert Pretcher you can't be knowing that with 100% accuracy -how to detect a trend in the early stage-. Not even the guys (the big players) that start them know if they're going to unfold or not.

And still we're looking for indicators that don't lag and price action patterns we can predict. IRONIC

I believe that there are only two things that work. One is probability which implies having a big, big account. And the other is discretionary trading.

But remember, it's not the car that's the most important, it's always the driver!

/George

Reply With Quote
 
  #4 (permalink)
Membership Revoked
Tucson, AZ
 
Futures Experience: Master
Platform: MB Trading Navigator
 
TheRumpledOne's Avatar
 
Posts: 418 since Aug 2009
Thanks: 0 given, 206 received

Am I allowed to post in here?

Reply With Quote
 
  #5 (permalink)
Market Wizard
virginia
 
Futures Experience: Intermediate
Platform: ninja
Favorite Futures: ES
 
cory's Avatar
 
Posts: 5,218 since Jun 2009
Thanks: 628 given, 6,316 received
Forum Reputation: Legendary

chop is in circle, trend is following the arrow. But that is just in a hindsight, in real time you just follow the market bar by bar and as long as it makes HH then it trends up, LL then it trends down, HH, LL then it chops

Attached Thumbnails
Trend, Chop and Momentum-trend.png  
Reply With Quote
The following user says Thank You to cory for this post:
 
  #6 (permalink)
Elite Member
Sweden
 
Futures Experience: Master
Platform: TT, NT, MetaTrader
Broker/Data: Velocity Futures, MB Trading
Favorite Futures: EUR/USD
 
George's Avatar
 
Posts: 401 since Jun 2009
Thanks: 1,005 given, 1,167 received


TheRumpledOne View Post
Am I allowed to post in here?


TRO,

Please,do so! You don't have to ask me for permission. My task is to moderate, not to create order being preventive! Yours is to express yourself in case you wish so, and to respect the atmosphere and the rules of this forum.

/George

Reply With Quote
 
  #7 (permalink)
Membership Revoked
Tucson, AZ
 
Futures Experience: Master
Platform: MB Trading Navigator
 
TheRumpledOne's Avatar
 
Posts: 418 since Aug 2009
Thanks: 0 given, 206 received


George View Post
TRO,

Please,do so! You don't have to ask me for permission. My task is to moderate, not to create order being preventive! Yours is to express yourself in case you wish so, and to respect the atmosphere and the rules of this forum.

/George

Well, I am not so sure anymore. Because I have an opposing view many times, it seems that has been taken to mean that:

1) I think others are stupid

2) I think the topic makes no sense

3) Saying that "price either goes up or down" is offensive.

To me, a DISCUSSION FORUM means that ALL VIEWS on the topic can be presented NOT just the prevailing or popular view.

A thousand people can tell a lie and it is still a lie. One person can speak the truth and it is still the truth.

I received this in a PM:


Quoting 
I suppose you mean the chat on the frontpage; no, that't not it. Remark was more about the comments you get about the way you interface with other people and their reactions like you should react like this or that (in other words you should "behave" or be politically correct or polite or something). Meanwhile they don't get the point about the simple ideas you're putting in front of them. People don't seem to understand that it's not about FORM but about CONTENTS. People are addicted to FORM, they will take EVERYTHING for granted as long as it is presented nicely and they don't have to THINK. It is a mental illness leading to blindness. They do it to themselves. Sad, but funny at the same time. Yes, you may call me a sadist



I say: THERE IS NO TREND.

May I be allowed to continue?

Reply With Quote
 
  #8 (permalink)
Elite Member
Sweden
 
Futures Experience: Master
Platform: TT, NT, MetaTrader
Broker/Data: Velocity Futures, MB Trading
Favorite Futures: EUR/USD
 
George's Avatar
 
Posts: 401 since Jun 2009
Thanks: 1,005 given, 1,167 received


TheRumpledOne View Post


I say: THERE IS NO TREND.

May I be allowed to continue?


Go on, but please stick to the TREND!

/George

PS: Let the trend be your friend

Reply With Quote
 
  #9 (permalink)
Membership Revoked
Tucson, AZ
 
Futures Experience: Master
Platform: MB Trading Navigator
 
TheRumpledOne's Avatar
 
Posts: 418 since Aug 2009
Thanks: 0 given, 206 received

Please register on futures.io to view futures trading content such as post attachment(s), image(s), and screenshot(s).


95% of traders lose.

Do you think most of them were using "conventional wisdom"?

What about all of the fund managers who can not beat the index?

What about all of the fund managers who have lost billions?

THERE IS NO TREND.

TREND IS A CONCEPT.

TREND EXIST ONLY IN THE MIND OF THE TRADER.


Look at the chart and tell me if the trend is up or down.

TREND IS RELATIVE TO THE OBSERVER JUST LIKE TIME WHICH IS ANOTHER CONCEPT.

One must separate what is REAL from what is CONCEPTUAL.

Do you see the multimeter in the upper right hand corner? That shows the trend on 9 different chart periods over 5 different bar periods. You are looking at 45 different trends for the same instrument at the exact same time.

THERE IS NO TREND.

Reply With Quote
The following 3 users say Thank You to TheRumpledOne for this post:
 
  #10 (permalink)
Elite Member
Sweden
 
Futures Experience: Master
Platform: TT, NT, MetaTrader
Broker/Data: Velocity Futures, MB Trading
Favorite Futures: EUR/USD
 
George's Avatar
 
Posts: 401 since Jun 2009
Thanks: 1,005 given, 1,167 received


Al right TRO,

I agree that 95% of traders lose because of their perceptions of the markets and all the criteria involving that action. But I would like to know if there's no trend, why there's no trend, and if there's no trend then what is it?

And if "TREND IS RELATIVE TO THE OBSERVER JUST LIKE TIME WHICH IS ANOTHER CONCEPT." are you telling me that the only thing you need is to direct your subjective perception to include winning and that's what you'll get?

/George

Reply With Quote

Reply



futures io > > > Trend, Chop and Momentum

Thread Tools Search this Thread
Search this Thread:

Advanced Search



Upcoming Webinars and Events (4:30PM ET unless noted)

Jigsaw Trading: TBA

Elite only

FuturesTrader71: TBA

Elite only

NinjaTrader: TBA

Jan 18

RandBots: TBA

Jan 23

GFF Brokers & CME Group: Futures & Bitcoin

Elite only

Adam Grimes: TBA

Elite only

Ran Aroussi: TBA

Elite only
     

Similar Threads
Thread Thread Starter Forum Replies Last Post
Detecting chop shodson The Elite Circle 154 May 14th, 2017 08:48 AM
Chop Indicators Blz17 Traders Hideout 58 February 11th, 2016 01:45 PM
Simple Chop using ECO2New MXASJ NinjaTrader Programming 15 January 26th, 2015 04:33 PM
Chop indicator NT shah1266 NinjaTrader 1 August 4th, 2011 09:12 AM
Trend trading and momentum indicators nqemini Traders Hideout 5 February 26th, 2010 09:11 AM


All times are GMT -4. The time now is 11:33 AM.

Copyright © 2017 by futures io, s.a., Av Ricardo J. Alfaro, Century Tower, Panama, +507 833-9432, info@futures.io
All information is for educational use only and is not investment advice.
There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products. Past performance is not indicative of future results.
no new posts
Page generated 2017-12-14 in 0.14 seconds with 20 queries on phoenix via your IP 54.227.51.103