Supportive market conditions

Set a contrarian position at the trendline ceiling of the trend direction

Set a contrarian position using horizontal support/resistance as the bottom of the direction

You can set contrarian positions with horizontal support/resistance and angular support/resistance

Basically, whenever applying stop loss in any market, you need to be conscious of the "shape" of the chart

In other words, the envelope becomes necessary at this time

Because the market is moving with support/resistance as the axis

That movement is always reflected in moving averages

If you are aware of the support/resistance moving on top of that envelope,

it's easier to understand where the support/resistance levels are

At the point of contrarian logic, the analysis is quite discretionary

There is little value in the effectiveness of analysis indicators

Ultimately, contrarian applications come through via the support/resistance

What’s easy to understand is the contrarian entry at RSI level numbers

Usually, the cases where contrarian trades are valid occur at support/resistance levels

In the end, it is a tool to gauge the trend, a tool to perform trend-following

That is the essence and appeal of the analytical indicators

All analyses are modeled starting from moving averages

If you treat moving averages as something you forcibly convert into histograms or oscillators for contrarian purposes, it’s easier to understand

There may be other concepts of analysis, but if the same base as moving averages is the target,

it's not that different from moving averages

Even if RSI is excellent as a contrarian tool

its price movement range is not sustainable when compared to the subsequent market swing

In other words, it will end up negatively offsetting (simply speaking)

So basically the basic trading is to follow the trend and use trend-following

The idea of contrarian trading also means trading in the direction of the current trend

It should never be a perfect contrarian

Also, when entering a trend as a contrarian, if you use RSI-like contrarian analysis,

you can time it by level numbers, but

that timing is not suitable as a temporary market top/bottom timing

Level numbers indicate contrarian entry points, yet the price continues to move against you for a while

Then it dips back a little, moves forward again to touch the contrarian level,

and from there the market temporarily shows a top/bottom and contrarian trades succeed

In other words, even as a contrarian, it ends up as a "slightly marginal" result

If you trade only based on support/resistance as the indicator, you can achieve "effective results"

Oscillators function as trend-following too

If you viewed them as contrarians and then oscillators appear, you might mistake a trend reversal

and enter a reversal trade, only to be fooled, so

In market reversals, market trends, and temporary tops/bottoms

Most indicators other than moving averages end up as excessive focus or ambiguous results, so

if you are not faithful to the market, there is no need for them

Be flexible with the market,

Include indicators that do not hinder trading due to noise in the market

Ultimately, it is easier to trade with nothing added

Just be conscious of support/resistance, which makes trading easier

Simply put

If you think of stop loss as a contrarian entry, it’s averaging down

If you think of stop loss as trend-following, it’s pyramiding

That’s what it becomes

However, even trading that way won’t be profitable

Direction alignment plus moving before the stop loss is hit yields movement in the desired direction

Profits come only after this premise

Also, if you always use averaging down/pyramiding, as with automated trading, you won’t profit

You’ll face a backlash

Therefore, averaging down and pyramiding must be considered very carefully in the market

And it should be kept simple

In other words, when you go on the offensive, you should be able to actually pursue profits

That’s why trend strategies become dominant

Trend strategy plus support/resistance strategy works in any market

Always use stop loss

Trades without stop loss are nice, but many times you end up taking a painful hit in the end

Ultimately you end up feeling you have some cushion

You think "it's okay" even when the price moves against you

This is something that the market has ingrained, so you should accept it

Then, with trend strategy plus support/resistance strategy, it’s beneficial to increase capital with stop loss

That will be advantageous for the future

Also, not using stop loss is often mistaken as averaging down, but

If you average down, you incur heavy losses when you cut losses

compared to the profits you had

When averaging down and moving against you, profits can be offset by losses

Also, in terms of total profitability

The tendency is to focus only on profits; when talking about averaging-down logic, this is especially

Averaging-down logic is good when profits are gained

but when losses occur early, the number of losses increases, and if late, the P/L becomes large

Additionally, rapid market accelerations occur

Can you respond to all of this? That’s the question

Whether it’s stopping losses or taking a break

Can total profits be preserved? Can you record a positive total?

In the end, it’s hard, so do it in one shot

If you’re going to do it in one shot, you should set a stop loss

Also, if averaging down is performed poorly mechanically, you should trade with stop loss in the same manner as averaging down

But that is very disadvantageous unless the market moves in the same direction

In other words, it’s similar to a Martingale-like logic

If the price comes back, there’s profit; if not, big losses

As losses grow with adverse market moves, the losses become unrecoverable

In reality, I would like to only trade during trend markets

But that’s not possible, so we can’t reliably predict such conditions

In the end, you just “press” the trade

Just trade, and strictly focus on trading that increases capital with each cycle

Do not adopt an easily profitable logic just because profits exist

Always ensure that you can increase capital at the final stage yourself

Thinking of stop loss as contrarian entry

The trend becomes weak when the trend changes

Because of that, the conviction about the trend becomes stronger

With trend-following, you can always understand that the trend has changed, so you won’t miss opportunities

Therefore, entering with trend-following is important

Contrarian trading always tends to have a averaging-down mindset

Return-to-origin or Prospect Theory show that “improbable moves can happen” in the market

And such markets occur "every time"

Thus, pursuing trend with a trend-following approach is essential

In contrarian trading, for example, even if the long-term timeframe and direction align

before moving in that direction, you will often wrestle near tops/bottoms before moving

If you do contrarian trading, you will lose many times there

In trend-following, it happens only once, so fewer failures

Contrarian timing requires matching timing, but

In trend-following, you can enter where the price is moving in the direction, which is the timing

If you focus on timing, contrarian positions risk being stopped out

Since it hasn’t moved far yet

However, in trend-following, since it is moving in the direction, stop-loss risk is lower

Ultimately, the best logic is to have nothing on the main chart

Envelope can help predict the trend

With Williams, you can enter using trend-following

Back to the origin, it’s a strategy via support/resistance

If you have learned to anticipate the market, you can trade with support/resistance

If envelope is used to gauge the trend,

if you can focus on support/resistance, it becomes unnecessary

Looking at 30 minutes, 1 hour, and 4-hour charts, you can generally see support/resistance focus

Williams is for trend-following

Only the trend-following part is valuable

Because it is easier to enter when the trend view is off-kilter

In past markets, even if support/resistance awareness existed,

in current markets there are markets where support/resistance awareness cannot be formed or is difficult

That’s when trend-following signs are usable

With Williams, signs appear conveniently when moving in the direction, which is valuable

Also fractals work similarly; if you always have support/resistance awareness, you don’t need much else

Williams is about it

Basically, all

moves are driven by moving averages or support/resistance

So predicting the market is enough with just support/resistance

When looking at past markets, it seems easy to analyze

In current markets, not so much; it can be difficult to use, and there are weaknesses that frequently appear

So, fundamentally, keep indicators focused on trend-following only

After all, trend estimation is for trend-following

Envelope and moving averages merely display the trend

They do not inherently reveal the trend

Frequent false signals occur, so they are weak analytical indicators

If you perform trend estimation with support/resistance awareness,

you can simply apply Williams’ trend-following and capture profit

Indicators are sufficient for trend-following

Only use the sub-chart as a trend-following indicator

Main chart should only reflect support/resistance awareness

Contrarian and trend-following both rely on support/resistance awareness

The sub-chart is merely a trend-following indicator

Usually

Look at 30 minutes, 1 hour, 4 hours and trade with support/resistance awareness

When trends are present or unclear, use Williams for trend-following

Using envelopes for multi-timeframe trend estimation

You’re simply forcing trend estimation on time frames aligned with envelope fidelity

By adding support/resistance awareness here, you can trade more faithfully to the market than with envelope-based trend estimation

All markets favor trend-following

Because the market eventually moves in a direction

Where contrarian trading is advantageous is in timing

Contrarian strategies work in timing-rich markets

But even then, traps (false moves) frequently occur

Then there are markets where contrarian trading is less effective

In past markets contrarian looked advantageous

In real trading today, trend-following is advantageous

Post-hoc theory is contrarian, but

In real trading, trend-following yields the advantage

In contrarian trading

A market where contrarian works appears

(However, many traps such as stop hunting and misleads occur)

Contrarian entry points change frequently

(Horizontal support/resistance and angular support/resistance change frequently)

Contrarian stop losses tend to lead to averaging down trades

When a trending market occurs, you might get caught and the number of losses grows and recovery becomes unlikely

In trend-following

Contrarian markets are disadvantageous

When the price follows the trend, it becomes advantageous

Pairs well with support/resistance aware trading

Works for both horizontal and angular support/resistance markets

Being trend-following makes it easier to admit losses

(Since moving against it means you clearly lose)

As a result, you are less likely to miss opportunities when trends form

When weighing pros and cons, the trend-following logic leaves more profits

Support/resistance awareness

and

Sub-chart trend-following indicators

are the strongest analytical indicators

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