Wednesday, 1 April 2009

Scalping - Trend Following

It is important to keep in mind that when the market is trending you ONLY trade in the direction of the prevailing trend. DON’T try to trade in both directions. If the market is uptrending then you only trade the upward petit trends and you usually (there are exceptions) ignore the petit down trends. Only resume trading when you see that the market is resuming its upward trend catching a nice petit uptrend. (Reverse everything I just said for down trends) If the market is moving within a range such as a consolidation or within a triangle then you may trade both the up petit trends and the down petit trends.

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