Sure, although the rules of trend following are very simple. For example, you might decide to buy when the 10 period MA crosses up through the 20 period MA, and have a 100 pip stoploss. Once you've set your rules, you stick 100% to them - no judgment is allowed!
There are an infinite number of variations of rules you could use, although I'd recommend you read the backtested examples in Covel's Trend Following if you're thinking of giving it a go with real money.
You only exit when the trend comes to an end. Trend following doesn't use arbitrary profit targets, and rejects that idea that 'you can't go broke taking a profit' (you can!).
Have a look at the McDonald's chart here - viewtopic.php?f=35&t=2814&p=17553&hilit=mcdonalds#p17553
. That's the kind of move trend following is good at getting.
In terms of timeframe, the generally accepted wisdom is that it only works on 1 day + timeframe, but I think it can be adapted to other timeframes.
BTW, when you trade Betfair, do you trade trends yourself (if you're trading a heavily trending market, for example)?
Incidentally, there is a downside to trend following - you get horrendous drawdowns (percentage bank depletions). It's a bit like betting on 10/1 horses - if you have an edge, you'll come out ahead long term, but there will be times when you question your own sanity!
andyfuller wrote:When you do get one of these trends any chance of you posting up a thread for it as I am keen to see an example and the thinking for it.
What sort of time frame do you look for your trend trades to run for (or is it just until the trend ends, i.e. how long is a piece of string)?