All creations on earth have their own physical characteristics. Even cycle has it's own characteristics. The anatomy within the "group" are generally NOT exactly the same, BUT similar.
Price trend cycle has it own anatomy given that it is "alive" and evolving as it goes along. Price trend moves in a certain direction within the cycle. If the cycle is UP, than price will go upwards above the horizontal BUT in a zig-zag manner like a snake motion.
In general, the up zig-zag movements will under-go retreats or some label this as corrections or profit takings. One deep pull back correction will happen shaking the market participants only to retest the earlier top before this pull back after this temporary dip is over. Sometime if the trend is strong, the price will scale higher than earlier top and go beyond.
What happens to the up cycle also applies to the down cycle except they are opposite.
Due to the fact that cycles are products of human emotional actions (non-linear), No two cycles are the same. The cycle will differ in intensity, time and magnitude. But the basic features will remain the same.
How do we tread the opposite retreats of the cycle safely and not shaken before the cycle ends? I has my fair share of "missing" the boat in the 90s due to this serious opposite retreat. In the 90s, I was in stocks, the it is a one way street where I can only BUY/LONG the stocks. When a deep correction comes, I got shaken only to sell low in the process and to see the stock price scale higher after this "digestion" is over.
It was only after re-looking and analyzing the trend cycle behavior anatomy, I manage to see with clarity and map the features accurately.
A lot of my discoveries is my perseverance, patient, self-questioning, observations and curiosity.
The systematic logic is when I know how and what a price trend cycle is like, the next obvious step is to develop a simple system to follow the trend until it ends. Last is to select the indicator(s) that I am familiar and comfortable to track the "movements" and most importantly the deep fake retreat using the indicators to confirm each and every move.
Strategically, I start to capitalize on this path map to lighten my positions before the massive retreat and reinstate my positions when my system indicates the probability of the retreat is ending and resuming the earlier trend direction.
We have read and heard about AI trading and the sorts. In my own opinion, I doubt the AI is capable of outperforming the simple trend following system.
The key advantage I have over many other people is my ability to put my personal bias aside, analyze the situation critically and honestly to see the truth. Accept wrong decisions and errors. Go back to the drawing board and improvise.
Forex markets on MT4 and or MT5 is where I do all the R&D, testing with small capital.
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