[TheNegotiator]

All through my time as a trader so far, I have heard of trend traders, position traders, scalpers, faders and numerous other styles of trading. What it all seems to come down to though is you either go with the market or you go against it. To me, this rather pidgeon holes traders. It tends to lock them into a certain market with certain tendencies and when changes come about, it will give pretty lean spells to them or kill them entirely. This is kind of a self regulating structure I guess.

I have over the course been more or less a reversion position trader if you like. Some markets are better than others for this, but at the moment, I am finding more and more we have these short term trends. It's really just overall balance but on a pretty big scale(in index futures). But generally speaking I just don't like to think of myself as a trend trader and the fact that I don't run trades overnight is somewhat limiting in this respect.

All this said, there are upsides and downsides to being a trend trader. You probably have a good deal of losing trades but your winners should be huge. You have I would say, to trade across multiple products and so get a great overview of the 'whole market', but also you're probably never going to be an expert in any. Your exits are in some cases a killer as you'll be trailing fairly wide, so you may end up 'missing out' on say 30% from your MFE. You're exits are very rule driven so perhaps less stressful(not to say non-trend traders exits aren't rule driven). When you have the right conditions you absolutely cream it. When you have the wrong conditions you'll probably get stuffed then stop trading just as there is a breakout leading to a trend!

Anyway, so my question to you guys is do you feel you can be both? Can a trader truly transcend trend and reversal and just be at one with the market in all conditions? I feel this is possible but more than anything is fraught with psychological issues. Switching seemlessly from one mindset to another can be quite challenging. I saw a funny thing in TT recently which I'd not noticed before. You can actually invert the DOM to show lower prices at the top and higher prices at the bottom! This tells me how strong the psychological tendencies we have can be once we have got used to something, as they put this into their program!

Of course there is a very clear other path to take here. Avoidance on recognition. Just stop trading in a sideways market if you are a trend trader or in a trending market as a reversion trader. Just seems to me that it's possible to be more than just a specific condition trader.

What do you guys think?

[wrbtrader]

Originally Posted by TheNegotiator »

...Anyway, so my question to you guys is do you feel you can be both? Can a trader truly transcend trend and reversal and just be at one with the market in all conditions? I feel this is possible but more than anything is fraught with psychological issues. Switching seemlessly from one mindset to another can be quite challenging. I saw a funny thing in TT recently which I'd not noticed before. You can actually invert the DOM to show lower prices at the top and higher prices at the bottom! This tells me how strong the psychological tendencies we have can be once we have got used to something, as they put this into their program!

Of course there is a very clear other path to take here. Avoidance on recognition. Just stop trading in a sideways market if you are a trend trader or in a trending market as a reversion trader. Just seems to me that it's possible to be more than just a specific condition trader.

What do you guys think?

I'm a strong believer that to be a consistent profitable trader we need to play both sides to understand and exploit the weakness of either. Further, to get to the point of being a consistent profitable trader along with being such for several years, the trader has developed a strong understanding of the price action so that being able to "switch seamlessly from one mindset to another" is not difficult.

In contrast, it may be more difficult for someone that's profitable but doesn't have enough trading experience to make the change (switch) or adapt when market conditions change.

I myself like to trade volatile range price action but I made great improvements as a range trader when I learned how to recognize and trade trends or strong directional price actions.

[Tradewinds]

Originally Posted by TheNegotiator »

. . . . , so my question to you guys is do you feel you can be both? Can a trader truly transcend trend and reversal and just be at one with the market in all conditions?

The answer is 'Yes'. But the trader needs to know what moves price and be able to read it very quickly. And even though understanding all conditions is more complicated on the surface, the underlying basics are the same no matter whether the market is trending or consolidating; smooth or choppy.

Probably very few traders are able to narrow their inputs down to only the critical ones that actually have some correlation to what price is doing.

[Dutchie]

Originally Posted by TheNegotiator »

Anyway, so my question to you guys is do you feel you can be both? Can a trader truly transcend trend and reversal and just be at one with the market in all conditions? I feel this is possible but more than anything is fraught with psychological issues. Switching seemlessly from one mindset to another can be quite challenging. I saw a funny thing in TT recently which I'd not noticed before. You can actually invert the DOM to show lower prices at the top and higher prices at the bottom! This tells me how strong the psychological tendencies we have can be once we have got used to something, as they put this into their program!

Of course there is a very clear other path to take here. Avoidance on recognition. Just stop trading in a sideways market if you are a trend trader or in a trending market as a reversion trader. Just seems to me that it's possible to be more than just a specific condition trader.

What do you guys think?

Hi,

My experience is that you can only recognize sideways markets "after the fact". IMHO it is virtually impossible to tell when a sideways movement (correction or consolidation) is beginning or ending. However, sideways movements or corrections are perfect for breakout trade setups, since 90% of the time price will start moving in the direction of it's preceding trend. I have learned a lot from Robert Miner Dynamic Traders on this subject.

After a couple of years of trading I love trading (the end of) corrections once you know how to spot them. Implying I am a trendtrader.....

Cheers,

Peter a.k.a. Dutchie

[Interceptor]

I believe that time-frames are the key.
I trade trends on H4 and up, and I trade reversion on M15.
Market noise is ok, if you position yourself accordingly.
cheers

[TheNegotiator]

Personally, the way I attempt to go about trading reversion and trends is not a separate method, but a hybrid of the two. I think many people do try to 'run' a small part of a profitable trade where fixed targets(price, indicator, profit or whatever) have been met, but they don't truly treat it like a trend trader would as they are still in fixed mode so to speak.

I realise in this way I won't ever really catch the kind of profits on an individual trade that true trend traders take, but also I don't have to endure multiple losses in order to catch a big trend. Most importantly for me, I don't ever have to flip between the two different mindsets.

Anyone else a hybrid? Lol.

[Do Or Die]

Originally Posted by TheNegotiator »

Anyone else a hybrid? Lol.

I thought I blabbered way too much about trading regimes to bore people. Good to see the mods didn't notice it

[zdo]

Originally Posted by TheNegotiator »

All through my time as a trader so far, I have heard of trend traders, position traders, scalpers, faders and numerous other styles of trading. What it all seems to come down to though is you either go with the market or you go against it. To me, this rather pidgeon holes traders. It tends to lock them into a certain market with certain tendencies and when changes come about, it will give pretty lean spells to them or kill them entirely. This is kind of a self regulating structure I guess.

I have over the course been more or less a reversion position trader if you like. Some markets are better than others for this, but at the moment, I am finding more and more we have these short term trends. It's really just overall balance but on a pretty big scale(in index futures). But generally speaking I just don't like to think of myself as a trend trader and the fact that I don't run trades overnight is somewhat limiting in this respect.

All this said, there are upsides and downsides to being a trend trader. You probably have a good deal of losing trades but your winners should be huge. You have I would say, to trade across multiple products and so get a great overview of the 'whole market', but also you're probably never going to be an expert in any. Your exits are in some cases a killer as you'll be trailing fairly wide, so you may end up 'missing out' on say 30% from your MFE. You're exits are very rule driven so perhaps less stressful(not to say non-trend traders exits aren't rule driven). When you have the right conditions you absolutely cream it. When you have the wrong conditions you'll probably get stuffed then stop trading just as there is a breakout leading to a trend!

Anyway, so my question to you guys is do you feel you can be both? Can a trader truly transcend trend and reversal and just be at one with the market in all conditions? I feel this is possible but more than anything is fraught with psychological issues. Switching seemlessly from one mindset to another can be quite challenging. I saw a funny thing in TT recently which I'd not noticed before. You can actually invert the DOM to show lower prices at the top and higher prices at the bottom! This tells me how strong the psychological tendencies we have can be once we have got used to something, as they put this into their program!

Of course there is a very clear other path to take here. Avoidance on recognition. Just stop trading in a sideways market if you are a trend trader or in a trending market as a reversion trader. Just seems to me that it's possible to be more than just a specific condition trader.

What do you guys think?

re "What do you guys think?" I think you are at one of those opportunity crossroads

Typing the market and then applying the appropriate system to the current conditions is at the very core of my work to master trading

“Switching seamlessly” is a lifetime ideal I shoot for. It is literally a life passion for me. I go through times when it just flows, simply, elegantly … and times when I end up almost bloody head banging bloody …

Biases… the bias that a trend will continue can be very strong when it’s around ‘in there’ … when that bias is absent it looks like the end of every trend is immediately imminent.

I’m not an evangelist for others to take this path. Actually, I can’t really say much at all about this for you and other traders any more – it is more my own personal struggle and if you take it up it will be your own very unique challenge. I meet other traders who obviously have better nature and nurture in the ‘psychological’ docility it takes, but mentally either don’t have the inclination or a clue. I meet others who have the mental robustness but don’t have the emotional flippancy required. Both those are exceptions though, most traders I meet about this just return a blank stare

Going full blown “Switching” is best done on short time frames. As others have alluded to, on longer time frames you can be way past your stop point before being able to identify that conditions have changed – then suddenly nothing is ‘seamless’ is it?

In real time categorizing, the closer to the tick your sampling is the better, at the tick level is best!!!!
The following makes things considerably more complicated than I would like especially in 'quantification' work but ---I have wrastled with this stuff for 80% of my career and after much resistance, I had to concede and acknowledge the presence of multiple concurrent auctions in our modern markets... hth

sorry to cut it short but I gotta scoot.

all the best,

zdo