Strategy · Directional
TREND FOLLOWING
BullishUndefined riskIntermediate
Overview
Taking directional positions to capture sustained price trends. The oldest and most proven futures strategy, used by legendary traders like Richard Dennis and the Turtle Traders.
Setup
- 1.Identify a trend using moving averages, breakouts, or momentum indicators.
- 2.Enter in the direction of the trend.
- 3.Set a trailing stop-loss.
- 4.Hold until the trend reverses.
Max profit
Theoretically unlimited in a sustained trend.
Max loss
Defined by stop-loss placement and position size.
Breakeven
Entry price.
When to use
When strong macroeconomic forces or technical patterns are driving sustained directional moves.
When to avoid
In choppy, range-bound markets where false breakouts repeatedly trigger stop-losses.