Is this price action different?

My guess is that there are plenty of people trading now who didn't participate in the markets in 2008. Since the market bottomed out in March 2009, there has been a long uptrend, although the major averages have certainly struggled to make new highs in recent times.

Why I only buy on new highs and go short on new lows

Pure trend followers buy on strength and go short on weakness. In such a system you won't be opening positions on pullbacks or retracements that go against the main trend identified. Some traders will say that doing this would reduces the risk and maximises the rewards available.

Precious metals on the way up

Although I do not generally trade commodities these days, I do keep an eye on these markets, along with the major forex pairs. This is purely my preference, as I concentrate my efforts on stocks, yet historically the majority of the successful CTA's and major trend followers have utilised this strategy on commodities, forex, indices, interest rates etc.

Market speculation

I'm all for keeping things simple, and boiling things down to the absolute basics. Today, I decided to key into Google 'definition of market speculation' and see what came up.

Some random charts

Here are some current charts as of now - I will let you interpret the signals and trends on them:

Trading and Donald Rumsfeld

Here's a couple of famous quotes from former US Secretary of Defense, Donald Rumsfeld, which can easily be applied to trading, and in particular, to the core element of risk management:

Natural Gas

Although I concentrate on trading stocks, most trend followers tend to concentrate on other instruments, such as commodities, forex, indices, interest rates etc. To a degree, all markets are inter-related in some way or another, so I do look at these charts periodically, and as you would expect, there are trends popping up all the time.

Crude carries on down

There will be plenty of traders around the globe loving this downtrend on Crude Oil - a staple instrument in a typical trading basket of a trend follower.The $80 level is now broken - I'm sure hoping I'll see a similar kind of drop at the petrol pumps, but somehow I doubt it...

Remember, one big trend like this can easily the cover the accumulated small losses created by earlier failed signals. Just need to keep the faith...

Crude still leaking...

Russell Sands

Below is a talk given by ex-Turtle Russell Sands. Although he talks about trading commodities, the principles remain the same whether you trade stocks, commodities, interest rates, foreign exchange or anything else.

The philosophy of a trend follower

There are many ways of trading in the equities and commodities markets. These consist of utilising fundamental analysis, technical analysis or a combination of the two. A good trading method should be robust, which to me means that you can use the same method when trading stocks, the GBP/USD, soybeans, gold, or anything else, without having to tweak the parameters.