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How do you interpret/implement this statement?


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 Massive l 
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To put it simply, trade against what the crowd thinks.

Too high? Trade higher. Too Low? Trade lower.

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Massive l View Post
To put it simply, trade against what the crowd thinks.

Too high? Trade higher. Too Low? Trade lower.

Or simpler, use fear to your advantage. BTW, greed is a form of fear. Fear is losing out.

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NJAMC View Post
I have seen statements close to this for a while and I would love to hear how others "implement/interpret" this statement:

Markets are the result of crowd behavior, trade the crowds, not the markets!

How do you trade the crowd, how do you not trade the market?

Thanks!

What I believe is yes the markets (time frames) are the summation of crowd behavior, participants etc. in any given time frame. You can go along with the crowd but the higher time frame, equals a larger crowd.....more inertia..... there is bigger chance there will be some correction on your TF if price is at a major turning point on the next higher TF....bigger crowd. Major support on a multi day 30 min TF will be more meaningful than support at 5min TF in the last 25 minutes.

Crowd behavior can go to extremes at any TF. But at some point you will hit extreme conditions, whatever technique you use to interpret a extreme condition and then trading the crowd could be detrimental to your account but you must be cognizant of the next higher TF when trading with the crowd. But then again if you don,t believe this then it is impossible
to trade. It is tough enough to trade your beliefs...let alone someone elses beliefs.

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Last Updated on January 19, 2014


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