Why can it be said that trend-following on long timeframes is effective
Going with the trend is
different from counter-trend
losses appear first
and then profits grow later; that is the logic
and
short-term time frames have noise + even when it extends, the pips aren’t large
which is a disadvantage
long-term time frames have less noise + when it grows, the pips are large
which is an advantage
In a counter-trend logic
profits keep coming one after another, but you can’t escape unless you cut losses at the end
and even if you decide to cut losses at a breakout of support/resistance
losses just keep accumulating, and even if you keep making profits those losses offset them quickly
as a result, you end up with a net negative because you can’t utilize the counter-trend logic's advantages at all
In other words, counter-trend logic
to address a market where you can’t escape without cutting losses
all profits get offset and the losses become more prevalent
no matter what countermeasures you take, at some point a big loss will come
In the case of following the trend, it’s the reverse version,
even if losses keep appearing one after another, in the end profits appear, so the result is an overall increase
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