The issue with counter trend trading

[ruthlessimon]

Probably has been covered many times on this forum, but I thought this gif perfectly highlights the issue & subjectivity of counter-trend trading. Would love to know your thoughts, & how you'd read the chart as it develops.

[SeaHorseRacing]

I honestly would read that as I dont know. I would need confirming information elsewhere. I would not be doing much on that.

[to75ne]

agree with seahorse. no info in that graph at all, i would need to have a comparrison of at least one other runner and a time frame/reference

[ruthlessimon]

yah can understand your views - i'd definitely want to see some volume info (& time). interesting that neither of you would blindly follow the long/medium term trend, even it offered you a pullback. i think arguably you could make a profit in either direction - scalping the turning points (if you're good at spotting pullbacks). although you wouldn't be able to make any home run trades!

[to75ne]

i think arguably you could make a profit in either direction - scalping the turning points (if you're good at spotting pullbacks). although you wouldn't be able to make any home run trades!

if you have a crystal ball maybe but there is no info in that graph to make any decision other than to do nothing.

[giblespaul89]

I'd recommend reading up on fibonacci retracements, you can't always apply financial market theory to racing but they do give insight into trend behaviour. Also, in the instance of the gif, I'd be looking at the other runners in the market. The strength of their move should give you an indication. It's important to remember when trend trading that nothing is certain so as long as you go in with a defined strategy of when to go in and out, that's all that matters. Your ability to judge what is a retracement or noise improves over time.

(I'm relatively new myself so am no expert but there's my thoughts!)

[ruthlessimon]

I'd recommend reading up on fibonacci retracements, you can't always apply financial market theory to racing but they do give insight into trend behaviour. Also, in the instance of the gif, I'd be looking at the other runners in the market. The strength of their move should give you an indication. It's important to remember when trend trading that nothing is certain so as long as you go in with a defined strategy of when to go in and out, that's all that matters. Your ability to judge what is a retracement or noise improves over time.

(I'm relatively new myself so am no expert but there's my thoughts!)

appreciate your thoughts. the aim of my post was just to highlight the issue of counter trend trading. i know a lot of traders (including myself) struggle with its vague definition & i'd argue there is no such thing as a counter trend trade - as i was trying to highlight with the gif.

im not a fan of fibs myself though, recommend reading this (http://adamhgrimes.com/blog/fibonacci-fibs/)

[Euler]

A horse can't go off at 1.01 (unless the mad bomber is around) so there is a natural point in sports markets where the trend halts. As the price comes in out or out a horse is doing the opposite somewhere else and becomes value in either direction.

If the market has more traded money than punter money then you would expect a strong move to end as people close their positions.

[ShaunWhite]

Euler is right (obviously, it goes without saying)...there are many actors in a market, all with conflicting interests, all squeezing the same balloon.

As the song "Those magnificent men on their trading machines." goes...

They go up diddley up-up, they go down diddley down-down,
Looping the loop and defying the points of support and resitance.

(i think i need to get out more)