- They identified stocks that were setting up per their entry rules. This was based on price action and what the longer-term trend was;
- The entered without question when the appropriate entry signal was made;
- Most importantly, they have had the patience and discipline to let those trades play themselves out.
In other words, they have concentrated on what price action has been telling them on the stock they were intending to trade, not what other stocks, or the general market was doing.
And as we saw here, this approach can work on long and short trades simultaneously.
One member even posted up a screenshot of his current trades, which were doing very nicely thank you. By not predicting, or trying to second guess what may or may not happen, and by having his risk under control, he has allowed himself to follow those simple rules, and is now reaping the rewards.
And what if those trades didn't work out? Well that's where the good risk management comes into play.
Trend following can be that easy - it's almost boring. But that's the way it should be. All the hard work is done beforehand, setting out your entry/exit rules, risk parameters, and getting your mind in the right place to follow those rules. Once that is done, it's simply a question of "see it, plan it, trade it".
If you want to know how we do it, then come and join us.