First sacred cow: "If the trend started, it will continue" - page 3
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It is possible to speak with a sufficient degree of conditionality about a trend or a flat on a given TF. But if we move from, say, four o'clock at flat to five minutes, we will see trends. Or go up to weekly.
- I understand a trend, it's when there was a market reversal. And it lasts until it, the market has not turned, in the opposite direction. During the trend, there may be a lot of pullbacks and flatulence.Inrader, this babble, back and forth, take for trends.
>> Not to go against the trend (as we are taught by the classics), I understand how not to go against the market, that is, against the general (so to speak) trend.
Classic definition - when peaks and troughs are consistently rising or falling :)
It does not happen on all of them. The weekly chart may show a fall, the daily chart may show a pullback (rise), the hourly chart may show a fall again (pullback within a pullback), etc. We should always decide what we consider to be the major TF to determine the global trend (within the framework of the working TF) and not go higher than that - it will only confuse us. And we should not go much lower to find the exact entrance either, IMHO.
Of course, I was exaggerating about all TFs. Let's try to ask ourselves from the other side: why is there no trend at the same time in all TFs? It seems logical, if the price goes down, then it should go down in all TFs.
...the interesting thing is that this trend is clearly visible when it has already passed)
There is no trend!
You have to look at the root and try to decompose the quotient into generating fllets. Then everything falls into place: the beginning of a new trend is the end of a dominating flat. And vice versa.
Such thoughts have also occurred to me, the interesting thing is that this trend is clearly visible when it has already passed)
It is a property of the human brain to look for (and find!) orderliness even where there is none. On the first page I gave a picture, you can clearly see the trends, but in fact they are not there.
Let's try it from the other side, asking ourselves a question: why is there no trend on all TFs at the same time? It seems logical, if the price goes down, it should go down in all TF s.
Look at the picture again. We can clearly see that your statement is wrong:
Price moves in general direction, on different TFs (in this case t1,t2 and t3) it moves in different directions!
Let's try it from the other side, asking ourselves a question: why is there no trend on all TFs at the same time? It seems logical, if the price goes down, then on all TF it should go down.
No, it is not logical, the price movement is formed by traders, their nerves and stops.
For example, the market moved downwards. But at the same time someone was in buy. Stops triggered and the price went up. Then they are followed by scalpers on ticks (they close their positions and move up), then - by scalpers on minutes, then scalpers and so on. And then the pullback on the hours is ready.
Look at the figure to the left. These are three flat periods with different characteristic time periods t1, t2 and t3. Let's sum them up and get an analog of a price series with trend market features at the same characteristic times and without obvious signs of a flat:
The conclusion is the following: there is no such a thing as a "trend" in the markets!
Everything is a superposition of differently-periodic flotsam.
If we look at the charts at different TFs we can clearly see the movement in a well-adjusted direction, although on a higher TF this movement may seem to be a flat...
DrShumiloff 10.07.2009 10:17
No, it is not logical. The price movement is formed by traders, their nerves and stops.
For example, the market moved downward. But at the same time someone was in a buy position. Stops triggered and the price went upward. Then they are followed by scalpers on ticks (they close their positions and move up), then - by scalpers on minutes, then scalpers and so on. And then the pullback on the hours is ready.
But when you see that the movement should be down, for example, and it went in the opposite direction you have a nervous impulse because the fear of loss is above all with no information on what is to happen in the future...
You look at the figure again. You can clearly see that your statement is wrong:
I know it's wrong, so I thought I'd try and reason from the other end.
>>) I see your point, I agree in principle ;-)
But when you see that the movement should be downwards for example, but it has gone in the opposite direction, you immediately have a nervous impulse because the fear of loss is the highest in the absence of information about what should happen in the future...
That's the trouble. That's the reason for backsliding - our nerves.