Trend Reversal Indicator Remains Bullish
The market has held strong following the Trump election and as of yet my trend reversal indicator remains bullish.
Obviously that can always change at any given time, so even in the most bullish of markets, you want to be managing your stops and curbing your risk exposure. Right now, the Trend Reversal Indicator is still strong, though at extremes, it has done that for ages now. There is nothing new about that.
But could it end soon?
Possibly, days like we are having of late feel good to our morale. Makes you think you can't do anything wrong in this market. You have to be careful though because these markets all come to an end, and the majority of traders will ultimately give back everything they made. Avoid doubling down on trades, that is where a lot of people will get themselves in trouble when this market grinds to a halt. They'll see every dip an opportunity worth buying. And who shouldn't, every dip has been worth buying of late, but that doesn't mean you lose your discipline in the process. Always manage risk, always manage profits, always avoid unnecessary pitfalls and amateur trading decisions.
Trend Reversal Indicator
Going into tomorrow, you are going to want to see whether this market can follow through on today's breakout move. Yes, there have been plenty of breakouts a long the way, but this is the first one that has had a daily range of more than 1% in more than fifty trading sessions. So yes, today's a bit more special than other rallies, but it won't be if it can't rally tomorrow. Below is my take on the Trend Reversal Indicator:
Disclosure: None.
Let me explain the basic principle how most Forex systems work. They are tuned up to work in a specific market condition. They often make money in a trending market, but loose money in a choppy market. It is not a problem as long as the market is trending and the system is making more money than it loses. Such a system can be profitable for several months and you would be happy with it. BUT... PREPARE FOR THE WORST... Market change over time. A well designed system starts with trend analysis to stay away from potentially losing trades. There are two problems of how a Forex system recognizes the trend. PROBLEM: FALSE "STRONG TREND" INDICATION. The system responds only to immediate price action. An explosive price movement that is usually the result of news release is tempting people to jump in and make a profit. It looks like a "strong trend", but what usually happens next is a hard fall. To avoid falling into this trap, check for the SOLUTION to find a REAL trend: ==> http://www.forextrendy.com?nsjjd92834 SECOND PROBLEM: TREND RELIABILITY Most systems use various indicators to determine the trend. Actually, there is nothing bad about using indicators. One Simply Moving Average can do the job. The problem comes with the question: "Is the market trending NOW?" Whether the market is trending or not trending is not like black and white. The correct question is: "How well the market is trending?" And here we have something called TREND RELIABILITY. Trends exist and they can be traded up and down for a profit. You have to focus only on the most reliable market trends. "Forex Trendy" is a software solution to find the BEST trending currency pairs, time frames and compute the trend reliability for each Forex chart: ==> http://www.forextrendy.com?nsjjd92834