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Category: Trend Following

Day Trading is Not Trend Following

Posted on by Michael Covel

A recent email:

Hi Mr Covel, I am Michael Yang, a Chinese trader, also a reader of your book. May I ask you a question? I have already found a way to identify the trend, and I agree with your method. I always trade by following the trend. These days, I think of different time frame and find two general ways to trade. The first one: I try to identify a long-term trend in a big time-frame, just like day chart or 4-hours chart. Then I try to find any following-trend signal in a smaller time-frame. For example, if I find a down trend in a 4-hours chart, I will ignore all buy signal in any time-frame that shorter than 4-hours. I will follow all sell signal in 1H chart, 15M chart, even 5M chart. By this way, I think I can follow all big trend that identified in 4-hour chart. But, I will miss some big reversal trend. Because any trend change begin from small time-frame, and then big time-frame. The second one: I try to trade in any single time-frame. I will follow all signal in a single time-frame, buy, sell, and buy, sell, and then buy,sell. By this way, I can hold some position that against big trend in big time-frame and make a big stop loss, but I cannot miss some reversal trend. I follow all trend in a single time-frame. What is your opinion on these two ways? Which one do you think is better for traders? Thank you!

I have never met a successful trend following trader trading 1H, 15M or 5M time periods. That’s not trend following. That’s gambling. Feel free to follow-up with any questions.

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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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.

The Confusion of the Confused Will Never Be Fixed

Posted on by Michael Covel

An excerpt from here:

Trend following is the main cause of bubbles and crashes? Not exactly. Bubbles and crashes are primarily the result of central bank policy. Trend followers simply take advantage of their inane policies.

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.

Ep. 136: Money, Money, Money with Michael Covel on Trend Following Radio

Posted on by Michael Covel
Money, Money, Money with Michael Covel on Trend Following Radio
Money, Money, Money with Michael Covel on Trend Following Radio

Please enjoy my monologue Money, Money, Money with Michael Covel on Trend Following Radio. This episode may also include great outside guests from my archive.

Listen to this episode:

Want to learn more Trend Following? Watch my video here.

Ep. 134: Brendan Moynihan Interview with Michael Covel on Trend Following Radio

Posted on by Michael Covel
Brendan Moynihan
Brendan Moynihan

My guest today is Brendan Moynihan, an editor-at-large for Bloomberg News, where he manages the popular column Chart of the Day and writes about the economy and Wall Street. He has been with the company since 2007 after spending more than twenty years on Wall Street as a trader and risk manager.

The topic is his book What I Learned Losing a Million Dollars.

In this episode of Trend Following Radio we discuss:

  • How Moynihan’s background, the background of his subject, Jim Paul, and how the two came together in “What I Learned Losing a Million Dollars”
  • The psychology of loss and what we can learn from losing
  • The idea that you “just have to make the money” and why that can be a bad place to start as a motivator
  • Personalizing loss
  • Paul’s interactions with Rich Dennis
  • Studying the contradictions of great traders, and how loss is the only topic they agree on
  • Controlling how much you can lose
  • Staying the course and the importance of not changing your strategy mid-stream
  • Profit motive vs. prophet motive
  • The difference between investors, traders, speculators, bettors, and gamblers
  • The slippery slope of always wanting to be “right”
  • The five stages of internal loss
  • The danger of personalizing your success
  • The difference between discrete events vs. continuous events
  • The “uncle” point
  • Why it’s important to go broke at least once in your life
  • The difference between emotions and emotionalism

Listen to this episode:

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Ep. 131: Predictions, Dreams, Fantasies with Michael Covel on Trend Following Radio

Posted on by Michael Covel
Predictions, Dreams, Fantasies with Michael Covel on Trend Following Radio
Predictions, Dreams, Fantasies with Michael Covel on Trend Following Radio

Please enjoy my monologue Predictions, Dreams, Fantasies with Michael Covel on Trend Following Radio. This episode may also include great outside guests from my archive.

Listen to this episode:

Want to learn more Trend Following? Watch my video here.

31 Steps to Your Millions in Antiques & Collectibles (or Trend Following)

Posted on by Michael Covel

Barry Chalmers passes along an excerpt from “31 Steps to Your Millions in Antiques & Collectibles” by Daryle Lambert:

Very trend following excerpt indeed.

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.

Austrian School and Trend Following

Posted on by Michael Covel

Feedback in:

Mr. Covel, I am currently reading “Capital and Its Structure” by Ludwig Lachmann. Lachmann was an Austrian School economist who studied under Hayek at LSE in the 1930s. This book is one of the seminal works on Austrian capital theory. Towards the end of the second chapter, Lachmann develops the concept of “meaningful” and “meaningless” price movements and links them to random and permanent economic forces. He then gives an example. Lachmann’s treatment of his idea in the example is essentially a Nicholas Darvas box theory, breakout, trend following description of price movements in the economy. Lachmann is not referring to stock or commodity prices per say, but upon reading his example I immediately linked it with trend following. The relevant passage can be found here, starting on p. 30 (p. 40 of the PDF version of the book).
Sincerely,
Augustus Van Dusen

Nice find!

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.