Roger Felton

"Now, the market can move up or down, but "price" cannot". This is definitely the holy grail. I've been staring at charts for 30 years and never noticed that the Market goes up and down all day long while Price stands perfectly still because it "cannot" (move). What a revelation! Next time one of my students says, "Price is now at 105.00 in CL, I can confidently tell them that is impossible because I just read that Market Price cannot change. It is steady state and cannot rise or fall. It'll be a hoot to read all the posts about how I've lost my mind.

The first thing you learn in trading is that no one has ever come up with a universally accepted definition of a trend that has any real value. Some "trends" only last for a couple of cycles while others can last a great deal longer. One trader's uptrend can occur in another traders downtrend...which can both occur in yet another trader's uptrend. Who's right? Does it matter? Mr. Levin did a superb job of creating an interesting post title without providing any useful information concerning trends. What is the specific moment when a market move becomes a market trend? How can we identify when a trend is actually over?. Tradewinds makes some interesting points, but the questions raised have a thousand answers. What is a trend? I have more definitions than you'd believe. What makes price do what it does? To answer that, you'd have to tell me what specific market and what precise moment in time are referenced...and then give me a year or more to research the thousands of variables and market forces that were exerting their influence at that particular time on the market. Sort of like the "Butterfly Effect", if you will. After all that work, you would have a huge list of thousands of random events and their individual effect on thousands of traders that caused the market to move up or down for a few bars or cycles. Imagine two identical leaves at the top of a tree one inch apart. Both fall at exactly the same moment from the same height. Why will they never land one inch apart? Why, with all the computing power in the world, can we not predict exactly where they will land? If you understand the unpredictability of the leaves, then you'll understand the difficulty of predicting the markets when so many random forces are affecting it simultaneously. The market does what it does because it is the cumulative result, moment by moment, of the fear and greed of every single participant. If anyone had the unique ability to access that information and know at any given moment what the resultant market reaction will be, they would own the world. Traders who try to "trade on news" are usually wrong more times than right. The point I'd like to make here is that a universally accepted definition of a trend is actually not that important nor is knowing specifically what is making a market do what it is doing. That's the wrong approach. Many traders do just fine just knowing that the market will go up and it will go down and why is not important. Traders who have a decent understanding of charting, market behavior (specific patterns) and proper use of strong Technical Analysis techniques can enjoy good, long-term consistent success. The market will tell you the precice moment when a trend is born and when it's exhausted. Takes work and a lot of practice, though. But, for what it's worth, if I do happen to discover the "one and only definition of a trend", I'll pass it along. Then I'll be glad to show you why you don't really need it.