To the average investor the stock market can seem to be complicated and confusing. Stocks go up or down but not on a straight line. Investor/trader can always score an ‘A’ on reading financial statement, or purchase the most expensive technical analysis software thinking it is a crystal ball. But what matters most is ‘trend’ and I’m talking about from the long term trend (1year-2years) to, the medium term trend (3months-6months), and to the short term trend (days-weeks).
Trend following is an investment/trading strategy that focus on capturing the different timeframe (long term – short term) on a particular market/stock based on every individual preference of timeframe. This allows investor/trader to ignore the ‘market noises’ that can thoroughly affect their everyday decision as trend is what they follow.
This is a nice uptrend!
This is a nice downtrend!
To consistently make money in the stock market, you only want to trade stocks that are in an uptrend not downtrend. But what are the characteristic that make up an uptrend and downtrend?
You can use one of our TFM method on knowing how to spot and uptrend and downtrend in the long run. This method predicts a trend change from 80%-100% of accuracy.
The complete uptrend formation
The complete downtrend formation
Every successful trader/investor requires a trend in order to ensure the stocks they invested in are profitable in the long run!
We always want to trade/invest on stocks that are at the beginning of the trend because these stocks have the most potential for explosive moves over the long run!