The Trend Is Your
At Fibtimer we time the financial markets by identifying
and trading trends. Over many years of research, we have
found that no one can accurately predict the future of
the markets consistently. They may do it once or twice
(remember Robert Prechter of Elliott Wave fame in the 1980s?)
but not over and over again.
Predicting presupposes you have the ability to "see" the
future. Much like a fortune teller. Beware any service
that tells you they can see the future. No one can. If
they could, every trader in the world would be after their
There are those who attempt to trade reversals. But first
you have to "wait" for the reversal point to be reached,
and then if you are incorrect, take a loss, exit the trade
and await the next reversal point. Too much like fortune
telling to us and really a system for short term traders
who are very nimble.
But there is a way of accurately being bullish during
advancing markets, and being bearish or in cash during
Identifying and trading trends.
What are the requirements and advantages of trading trends?
First you must have a trend established before you can
trade it. It also means you must wait until after the trend
ends before you can exit it. But most importantly, if you
trade trends, you will NEVER miss any bull market, nor
be hurt by ANY bear market. Ever!
This is an incredibly important advantage. Imagine never
missing a bull market and never being hurt during a bear
market. Or even profiting during a bear market. And all
you lose is a few points at either the top of the bottom!
Trend Trading at Fibtimer
We would not have developed our timing strategies at
Fibtimer without first researching the history of the
financial markets, as well as the potential of all of
the various timing strategies used by market timers.
What we found, was that market trends are much more pervasive than most would
think. In fact, trends could have been traded just as profitably 200 years
ago, as they are today.
Looking back at price data for 100 and 200 years, the very
same trending markets existed. There were short times of
sideways (non-trending) movement and long periods of strong
advancing and declining trends. Yesterday, just as today,
trading trends would be profitable.
trend timing strategies use highly disciplined
There are several important guidelines to successfully trading trends. Whether
used 200 years ago or today, they are just as important. And they will be just
as important tomorrow, ten years from now, or any time in the future, as long
as free markets are traded.
Highly Disciplined Trading Plans
Successful trend timing strategies use highly disciplined trading plans.
In the short term, the markets are run by the majority who are reacting to
the emotions of fear and greed. It is "comforting" to be moving along with
the crowd. That is why the majority do it. But it is NOT profitable.
The "majority" do not profit.
Executing a trading plan using unemotional buy and sell signals, designed to
capture the majority move of all major trends whether up or down, removes destructive
emotions from the equation.
A market timer will undoubtedly feel pressure to disobey the plan. He may be
swayed by advice from friends, current events, or the extremely powerful emotions
of fear and/or greed.
But if you stay with a trading plan that NEVER misses a trend, you will profit
If a trend fails, the trading plan must quickly reverse. If the trend becomes
a long term highly profitable one, the plan must keep you fully invested and
not allow you to exit during times of high emotion, when the crowd is exiting
Ignoring Short Term Volatility
Successful trend timing strategies ignore short term volatility in the attempt
to realize superior profits during major trending markets.
Trends can last months, and even years. During those profitable trends there
will be corrections to the trend. Exiting at every correction leaves a trend
timer on the outside looking in. Reacting to counter trend corrections often
results in small losses. This is why Fibtimer holds its position during such
|"Successful timing strategies
do not avoid volatility. Instead the depend on volatility to profit."
The is an almost overwhelming desire to "act" in the face of an adverse market
Often it is labeled "avoiding volatility" with the assumption being that volatility
But avoiding volatility often inhibits the ability to stay with the current long
term trend. The desire to have close stops, and to preserve "open trade" profits
has enormous costs over time.
Successful timing strategies do not avoid volatility. Instead the "depend" on
volatility to profit.
Finally, a successful trend timing strategy, never allows losses to accumulate.
Trend timers are protected from large losses by their strategy. A good strategy
never allows a failed trend to hurt capital. Trendless and/or volatile markets
are inevitable and during trendless markets there may be some small losses. But
a good timing strategy protects capital.
You cannot avoid the occasional failed trend and you cannot avoid the occasional
trendless market. But if capital is kept intact, when the next profitable trend
begins you are ready to jump on board and ride it to the end.
At Fibtimer we publish a weekly analysis for each strategy to prepare subscribers
for what is "likely" to come. Better to be prepared than to be hit with surprises.
But we never presuppose that we are so smart we can tell, unerringly, what the
markets will do next.
Trend timers do not try to anticipate reversals or breakouts. They respond to
Trend timers are not prognosticators. We just identify and follow trends.
Trend timers believe the markets are smarter than any of us. We make it our business
not to try to figure out why the markets are going up or down, or even where
they are going to stop.
Successful trend timers identify trends, trade those trends, and patiently allow
them to play out while their profits grow.
Predicting the markets is a fool's game. It is fun to do over cups of morning
coffee, but if you want to beat the financial markets, you must identify and
You must also stay with your trend trading strategy through thick and thin.
If no one can consistently predict where the markets are going, they also do
NOT know when the next trend will begin. Taking all trades guarantees that
you will never miss it when it start
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Disclaimer: The financial markets are risky. Investing is
risky. Past performance does not guarantee future performance.
The foregoing has been prepared solely for informational
purposes and is not a solicitation, or an offer to buy or
sell any security. Opinions are based on historical research
and data believed reliable, but there is no guarantee that
future results will be profitable.