| Dear Reader, Let's think of the markets as a massive railroad system across the country making stops at hundreds and hundreds of destinations and going back and forth. A train may start out in Phoenix, go to Flagstaff, stop off in Las Vegas, head on to Denver or Salt Lake City. These routes are symbolic of trends in the markets. One does their analysis and that serves as our "train schedule" but unfortunately there is some uncertainty as to whether the train will actually leave Flagstaff and head to Las Vegas. We use the information we have available to do some technical analysis and hope we are on the right train if we want to get from Phoenix to Las Vegas. The trend train pulls out of the Phoenix station and heads to Flagstaff. We have a little profit in our trade. We stay on the trend train through Flagstaff hopeful our next destination is Vegas. We arrive in Reno. Now we can either stay on the train or hop off having decided we have made a profit and will now await a train we are more certain will take us to Vegas or back to Flagstaff. The trend train is boarding so we hop on after doing our analysis and find ourselves in Minden, NV. We knew if the train went to Minden, we would get off the trend train as that is our stop loss and will await another train that may take us to Vegas representing going long the market or Flagstaff which would represent shorting the market. The course these train trips makes is like the market trends. The market can only go up, down, or sideways. When the trend train begins going one direction, we want to hop on as the train is beginning to pull out of the station and get off at our profit objective. If the trend train goes in another direction than we had planned for, we exit before we are taken all the way across the country. We are simply one of the many passengers riding the trend train and the more traders joining the train, then it stands to reason the trend train will pick up steam and continue on to further destinations. This can be good it the trend train is going in our direction or damaging if we don't exit when we recognize the train is taking us further away from our destination. When the train looks like it could be a trip from Phoenix to Vegas, perhaps it has to make a little stop along the way to pick up passengers, freight, or fuel. We watch it and when it pulls back but the overall destination remains what we believe to be likely, we ride out oscillations as this may indicate a trend train consolidation where more passengers, freight, and fuel may strengthen the trend train to make the trip all the way to Vegas, our profit objective. When we were leaving Phoenix, if we ended up in Tuscon, perhaps we offload rather than sticking with a train that may take us to San Diego or El Paso, which would take us way away from our destination. This is the Trend Compression System. A trend is sought out and then when the trend has a brief pullback but the longer term trend remains pointing in the direction we want to go, we hop aboard as the train looks like it is leaving the station continuing it's trend. By ourselves, we can't fuel the train. The more traders that jump onto a market trend, the trend should accelerate and gain strength which can be measured using indicators like stochastics, moving averages, the Relative Strength Index, and the ADX. The Cross Over System is like a railroad switching yard. In any case, we want to find trends and stick with them as much as possible, using good money management and the closer we get to our destination, the more likely we may step off the train should it begin to roll back down the mountain. As much as possible, we want to continue to either move in our direction of get off the train by exiting a trade. These are two of the systems I am employing and will be introducing additional systems and explaining the Cross Over System in more detail in the near future so be sure to take a look at the coming newsletters and use the forward button below to pass them along to your friends. Regardless of what system used, there are opportunities to make money and there is also risk of loss. Always plan a complete trade including stops and profit objectives and have it scripted and employed when initiating a position. | 
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