What is needed in trend following from now on is to confirm the standard axis for whether it will grow or not
Trend following isn’t that rewarding
The reward is indeed large within the profit zone, but
there are many other scenarios where it leads to losses
this is because traders themselves employ both trend-following and contrarian strategies
as a result, the balance of gains and losses shifted drastically
certainly there are markets where trend-following grows profitably
this is clear from past markets; however, due to prior losses
they offset to a result where profits aren’t that substantial
“a poor trend-following strategy tends to end up with mostly downward results”
this is likely accurate information
When you look at the market, you can see trend-following makes money
but even so, the reward is limited to “extremely few favorable periods”
actually, from the market’s perspective
only a very small portion of the overall market
becomes such a “trend-following holy-grail market”
in other words, continuous losses are inevitable
rather than ongoing losses, profits simply don’t grow that much
unless you insert intermediate profit-taking, trend-following strategies don’t hold
and in the subsequent opportunity market, you must grasp the growth to keep up
Trend-following requires “practice”
Contrarian strategies require “techniques”
so while it’s probably correct to say trend-following is recommended for beginners
the initial “practice” is hard to grasp, so it often remains a weak technique
Trend-following isn’t a “technique” like contrarian strategies
the point is to overcome this weakness in technique
because trend-following relies on trusting the market’s tilt
if it tilts, that itself causes losses
betting on the market to revert is a better winning probability
even if your thinking isn’t solely about maximizing win rate
you’ll eventually adopt a clearly win-rate-centered mindset
this is a rare phenomenon that occurs when routine work isn’t reasonably well managed
the routine work of trading is the biggest trigger for capital increase
simply put, the market fundamentally operates on discretion
grasping such baseline criteria is the most righteous stance toward the market
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