You are in the market to make money. It is the same for us. To make that money, we need a trend, up or down. The market can also trend sideways but that will not help our goal of absolute returns. If you buy, you need to be able to sell higher. If you short, you need to be able to cover at a lower price. The trend or sustained movement in the market either up or down is where we make our profits.
Trend Following is a trading strategy that does not attempt to predict market movement but instead only to ride the trend when it does appear.
It does not rely on analysts, brokers, TV personalities or hot tips.
Trend Following instead relies on systematic rules and probabilites around price action to make money over the long run.
This quote from Michael Gibbons sums up why we use Trend Following:
"The market is always right, and price is the only true reality in trading. If you want to make money in any market, you need to mirror what the market is doing. If the market is going down and you are long, the market is right and you are wrong. If the market is going up and you are short, the market is right and you are wrong. Other things being equal, the longer you stay right with the market, the more money you will make. The longer you stay wrong with the market, the more money you will lose."
We know we can't predict future prices so Trend Following makes sense.
LEARN TREND FOLLOWING
On this site you will learn the basics of Trend Following as well as critical trading principles. We will go through the pieces of what goes into making a Trend Following System. Once you have an understanding of these simple concepts, you can apply them to improve your trading. The goal is to become self sufficient in your trading so you can build a system that fits you so you can focus on success and profitability.
First is selecting what you want to trade. Let's go to the next page to learn about selecting markets.