This chart shows the positions Myfxbook members have on EURUSD. As you can see, the majority is nearly always wrong: They hold long positions when market is falling, and switch to short when it rises.
It makes sense though: the industrial forex players who make the most money arent on myfxbook - the money flows from small myfxbookers to the big players, which explains the graph above...
Of course profit-taking and long-term trading must affect this, but it still seems to give pretty good advice.
Has anyone tried simply betting against the community preference, no matter what the price does?
Interesting that no one has said anything about this. It is indeed a topic that some people have thought about it before, but to my knowledge no one has ever done it. I think it's something that would be quite difficult to backtest, but has some merit and would out perform most traders on this forum. I believe Oanda and FF also have metrics to show net positions of traders, it would be interesting to see maybe a system that just uses a tally between the three to trade. I may consider doing this in a trade journal if you don't
Myfxbook community outlook
Yeah, that strategy is pretty hard to write in ea code and backtest it.
I'm afraid I don't have time for manual trading now, but I will definitely use this counter-the-masses method in my next manual trade experiment.
If you decide to see if this is profitable, please post your results here!
Hi... The chart seems to show that the retail crowd is contrary to the trend, but......
Doesn't closing a previous sell position result in a buy? And with this aspect alone, there is quite a bit of profit taking at 1.1 and 1.05.
Unless myfxbook specifically focuses on open positions, in this case could be that the crowd is wrong.
The red and green areas are the total value of lots traded at the moment. It seems that majority of myfxbook use very short-term counter-trend strategy and so they fail in (even slightly) trending market...