
Trend Trading Strategy: Departure Trendline Setup
Daytrader21 Posted 4 Jan. in #Breakout #Consolidation #Confluence #Momentum #Fractal #Spike #Tredline #Angle #Departure Trend-Line SetupOver the last 2 years the market has been changing a lot and we saw across the board many currency pairs has started moving away from those nasty big range zone and have been shifted towards more clear trends. Trend trading can be as difficult as range trading if you don't understand the characteristic of this new type of environment, and you need new adequate rules to be able to profit in the market. In this regard my article is going to provide you with some core basics and unique rules that have been helping me to trend trading with a unique strategy.
A healty trading market is when we move step by step: Consolidation - Breakout type of move. As a general rule if a market is moving in a consolidation or a range trading box or a base, followed by a breakout and than repeat the process, than the market is doing what it should be doing (see Figure 1). One of the best hedge fund managers PT Jones has explained this process quite simple, and I'm quoting him here:
The basic premise of the system is that market move sharply, when they move. If there is a sudden range expansion in a market that has been trading narrowly, human nature is to try to fade that price move. When you get a r…