What is Countertrend Trading?
Countertrend trading simply means trading against the trend. This is a trading strategy followed by many traders for small gains by doing a series of trades against the trend. This includes buying of shares/products when market is on a downward trend and selling them when market is on an upward trend.
Countertrend traders trade all products like stocks, options, futures and currencies. They do so usually for small gains as holding there position for more time can harm them hugely. Countertrend traders use countertrend trading systems or momentum indicators to locate suitable trading opportunities.
Certainly, countertrend trading is not for novice traders. A countertrend trader must be well experienced to control his feelings, and courage and confidence to trade against the market, often by ignoring advices from other traders. Never match up countertrend trading with range trading, as range trading is the strategy to profit from oscillations in product price.
Countertrend traders trade all products like stocks, options, futures and currencies. They do so usually for small gains as holding there position for more time can harm them hugely. Countertrend traders use countertrend trading systems or momentum indicators to locate suitable trading opportunities.
Certainly, countertrend trading is not for novice traders. A countertrend trader must be well experienced to control his feelings, and courage and confidence to trade against the market, often by ignoring advices from other traders. Never match up countertrend trading with range trading, as range trading is the strategy to profit from oscillations in product price.
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