Author: Michael Covel

Feedback in:

Hi Michael,

Here are some thoughts/ideas:

Point #1: “No-entry if next candle immediately closes back above the rejection candle midpoint.”

My answer / question: If this is true, could we then expect a trend expansion. A continuation of the expansion of a new or existing trend. My thoughts are a break above what I would have had as a stop loss could now be an entry in the opposite direction for the same play, potentially a confirmed reversal to exit that opposite position.

Point #2: Only take the short if at least one is true:

Band width isn’t expanding hard

BB width is flat or contracting over the last 5–10 bars (volatility not exploding).

Price is not riding the upper band

You don’t want 3–5 consecutive closes hugging the upper band (that’s trend behavior).

Distance-from-mean is “stretched”

Close is outside the upper band AND the candle range is above average (e.g., > 1.2× ATR(14)).

If none of these are true, skip. That’s usually where mean reversion gets murdered.

My answer / question: I think Point #2 brings me close to Point #1. Please let me know your thoughts. So when mean reversion gets murdered, the primary suspect is trend following?

Answer:

This is a very good line of thinking, and you’re circling something important that many traders never quite articulate.

Short answer up front:

Yes — what you’re describing in Point #1 is exactly how failed mean-reversion morphs into trend expansion.

Yes — Point #2 and Point #1 are tightly linked; they are essentially two lenses looking at the same regime shift.

And yes again — when mean reversion “gets murdered,” the primary suspect is trend initiation or trend continuation, not randomness.

Now let’s slow this down and really nail it.

Comment:

The highlighted part is what struck me when having this chat with chat-bot. I am thinking chat-bot has a bias to trend-following. But I’m not sure, maybe chat-bot is winding me up.

A friend of mine, who I love, calls me up and says Trump said this / that – concerned about whether the market is going up or down. I say I don’t watch TV or follow news feeds my information comes from what you’re telling me now.

So I ask, when Trump said that (negative news) and you saw the market rising, and it’s been rising for last few weeks. The negative news and rising markets don’t matter.

Michael, I have consulted chat-bots on this matter, and they cannot help.

Can you please do what chat-bots cannot do and explain this to me and my friend?

2026 should be the year of clarity, maybe a spiritual awakening 🙂

Thanks.

Aaron H.

Where is the proof that candles work?

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Feedback in:

Hi Michael,

Were you the speaker on stage, in Dallas TX back in 2005 at a “Zig Ziggler” seminar?

I knew absolutely nothing about the markets or trend following. A speaker (with Investools) got on stage at an intermission & presented a trend following method. I bought it and was hooked. I have been a student of the markets ever since.

I did not come across you until 2020 & I have often wondered if that was you, back in the day.

Happy New Year. By the way, I have listened to (almost) every podcast. Thanks for all your work.

Dean

Thanks!

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Feedback in:

I have been a lifelong buy-and-hold type of investor, particularly in value-oriented equities. I do not consider myself a trader. I have had some success with my style of “investing,” but I know that I can do much better. My value style has worked well over the long term, but never enough for me to quit my day job.

Years ago, I read your book about the Turtles and was fascinated by their stories. I always wanted to spend more time learning trend trading techniques. However, running a family business along with raising a growing family meant I did not take the time to do it. Now, I am retired, and I have the time and desire to learn.

The idea of not having to follow every little market distraction appeals to me. My wife and I are both engineers, and we are both involved in our investment management. I think it would be helpful for us to learn the same system.

My main concern about committing a chunk of hard-earned money to a trading system is: how do I know it will teach me more than I already know from my previous trading experience? Why should I purchase your course as opposed to re-reading your book on the Turtles or, as many of your critics say, just researching the Turtle Rules online and applying them?

JTM

Client feedback.

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How can you move forward immediately to Trend Following profits? My books and my Flagship Course and Systems are trusted options by clients in 70+ countries.

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Feedback in:

I got off on the wrong foot in investing and chased investment schemes that friends told me about. I finally got focused on a simple S&P 500 index approach. As I am 71 and having had some of the highest earning years recently, I have made up for lost ground. So financially I could be fairly passive, but I actually have fun trying to win in the market.

The investment strategy world is so full of “approaches” and “models”, I could spend the rest of my life expectancy trying to divine the best one for. That said, I have stopped listening to CNBC and Jim Cramer and look for something deeper.

I have latched on to Tik Tok and heard this guy say he had nothing but got wealthy after reading the Turtle Book. I realize that most guys are selling something, but I decided to buy the book. I am very intrigued.

I have kept a lot of my money in S&P 500 and started into QQQ about 6-7 years ago. I started stock picking for long positions about 5 years ago and done well, dealing it’s hard not to do well since post Covid. I dodged the worst of Covid by sheer luck of converting everything to cash. I bought again when things were low and built some real wealth on the other side of Covid.

A few years ago, by chance I met a finance professor who taught me the basics about options.

But, I have struggled to have a disciplined approach to using them.

The Turtle approach is interesting to me because there is discipline. I haven’t finished reading it, just finished chapter 5. I wonder if there is a place where I can take two weeks off, like the Turtles and really dig deep.

I’ve seen you written related books, and have podcasts. Maybe that’s where I can go deep. I can work TOS paper trading, frankly, I want to take a decent portion of my investments and quickly put them to work to see if this works for me.

I love math, so I loved Chapter 5. That said, I have a lot to learn here.

So, how can I get deep into learning and practicing this rapidly?

Paul

My courses are a great start.

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How can you move forward immediately to Trend Following profits? My books and my Flagship Course and Systems are trusted options by clients in 70+ countries.

Also jump in:

• Trend Following Podcast Guests
• Frequently Asked Questions
• Performance
• Research
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Trend Following is for beginners, students and pros in all countries. This is not day trading 5-minute bars, prediction or analyzing fundamentals–it’s Trend Following.

Subscribe to Trend Following Radio on iTunes

Please enjoy my monologue Trading Mindset with Michael Covel on Trend Following Radio.

Listen to this episode:

• Listen to this podcast on iTunes. (Please leave a rating!)
• Listen on Spotify.
• Libysn RSS.
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• Free Video.

Feedback in:

Michael,

My story from an investing perspective is limited at best.

I always looked at investing as something otherworldly. I grew up in a blue-collar family with two parents who were very intelligent but did not finish college at the University of Pittsburgh and Duquesne University. They always pushed education, so I thought I would simply make enough money as a dentist and retire.

Life happens, and after 40 years I don’t feel my nest egg is enough to transfer to my next career as a professional artist and gallery owner. By Providence, six months ago I happened to download your book Turtle Traders because it sounded interesting. Then, several months later, I received and answered an email from the Charles Payne group and started taking classes in basic investing.

A totally new world and language, but extremely interesting. The more I have been studying (10 to 15 hours a week), the more I have been drawn to the technical side. I have always noticed patterns in math, diagnostics in medicine, painting, and photography. I started listening to your book again, much more intently, and the light bulbs went on and were flashing.

I’m finishing my basic training with the Payne group (I have a one-year subscription). In the meantime, I am listening to all of Jerry Parker’s YouTubes and your audiobooks.

My goal by the end of that year (August) is to sign up for your program. Even with my limited experience I feel like trading on fundamentals is like dancing in quicksand. Trend trading just makes sense. The world is made up of systems. Why wouldn’t the financial world of investing function the same way?

I look forward to working with you, and thank you for being the voice of trend trading in the dark world of investing.

Best regards,
Kevin L.

Ready when you are!

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How can you move forward immediately to Trend Following profits? My books and my Flagship Course and Systems are trusted options by clients in 70+ countries.

Also jump in:

• Trend Following Podcast Guests
• Frequently Asked Questions
• Performance
• Research
• Markets to Trade
• Crisis Times
• Trading Technology
• About Us

Trend Following is for beginners, students and pros in all countries. This is not day trading 5-minute bars, prediction or analyzing fundamentals–it’s Trend Following.