The trend is your friend… Again

This is a saying that has become cliche, but its a cliche for a reason. The trend truly is your friend until the bend at the end. Also knowing when the trend is starting also helps.

In our practical live training session we spend a lot of time trying to figure out whether or not price is trending or ranging. Seeing that price is doing one or the other is most of the time very simple and straight forward. But seeing when price transitions from one to the other is paramount to any trend strategies success in the Forex Market – Futures Market – Stock Market or any financial trading system that requires you to identify the trend.

The First stage would be to see that price is doing one or the other. This recent trade on GBPUSD highlights the first phase quite nicely as price has defined itself in a small range.

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Then we see GBPUSD move out of its consolidation but the key to not getting suckered in to several false starts is waiting for price to correct again and then to trade the pullback after that break out of the range.

This might sound simplistic but it really should be that simple. The hardest past in all this for many new and aspiring traders is to wait for the conditions to be right before pulling the trigger on a new trade.

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While not every trade will be a resounding success by waiting for this sequence of events you are stacking the odd more and more in your favour of a successful outcome. This is what you have to learn as a trader – not the pattern but the waiting for the conditions to be right for your set up.

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