|  FEB 1987

Trend of the trend by Gregory L. Morris

Trend of the trend by Gregory L. Morris Most indicators of trend are taken for granted even though many times they are used successfully by stock and commodity traders. It has been my experience that blindly following canned indicators can lead you into a false sense of security, especially if you begin using the indicator when it is correctly calling the market. If you begin using a trend-following indicator during its inevitable whipsaw period, you will lose faith and look for another indicator. Therefore, if you develop an indicator using some basic logic and reason which is related to known market action, you can have a little more faith in a particular indicator. There is also the argument of using a basket of indicators and/or using them in a tree structured approach. No doubt that is a safer approach, but it is not the purpose of this article. It is accepted that the successful trader must identify and follow the trend of the market to be a consistent winner. There are, of course, many indicators available to help identify the termination of a trend and prepare you to reverse your positions. Adding even more confusion to the arena, you have to determine which type of trend is being identified: short, medium, or long. Again, this is not the purpose here.

by Gregory L. Morris