In today’s episode, we discuss why the trend is not always your friend when it comes to trading.
There’s an old saying in the financial markets that the trend is your friend, meaning that you will do well as long as you place your trades onside with the current price trend.
The only problem is that you can never know what the current trend is – you can only know what the trend was during some prior period.
This can provide a false sense of confidence for new traders because the cleaner the trend, the more confident trader will be with taking a position
In fact, many new traders take breakout trades “in the direction of the trend” only to see the market reverse on them and stop them out time and time again.
The trend can be your best friend if you are able to identify it in the early stages of development before the expansion phase of the mark-up phase and get in with low risk and high reward potential.
Stick around for the full episode to get some great insight on why the trend is not always your friend and how you can put yourself in the best position to capture the most profitable phase of any trend
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