This is a YouTube video titled "Is Your Trading Strategy PREPARED for 2025's Wild Market Swings?" created in June 2025. The content features Brian McAvoy discussing trading strategies in volatile markets, focusing on the difference between market movement and momentum, and advising traders on how to adapt their momentum-based strategies to the unpredictable market conditions expected in 2025.
Hi, Brian McAvoy here. And today we're going to talk about something that's actually really important because this is going to make weird year 2025. And we fit some spells where markets are just crazy. You get a lot of uncertainty in the players of the market, let alone the market itself. And so it's made for some interesting challenges for traders. And I had a conversation with one of my coaches. This is where it's going to get important for you. Because nearly all traders, the vast majority of traders, are trading some sort of a momentum strategy. You're looking for some movement in the market that we can capitalize on. You're not looking for the markets to stay flat. So whether you're picking tops and bottoms, reversals, trend following, all kind of stuff, we're still looking for some sort of a move in the market that we can capture the beginning of that move because we recognize a certain something going on and then there's the move and we can get out and make our money. That's the general, like the super basic premise of most strategies. And the thing is the way the markets have been lately when they're really volatile and all that kind of stuff, the problem with that is you're sitting there working with a momentum strategy and you're sitting here trying to trade on movement. And movement isn't necessarily momentum. Here's the thing, when markets are volatile, here's the problem with that, when they're volatile, the markets aren't moving. There's a lot of movement in the price. And because there are a lot of individual traders speculating that it's going to go up or down and things, there's a lot of emotions and so there's a lot of movement, but it's not momentum. Momentum is when you have a significant number of players in the space, whether it's humans or computer algorithms moving the price one direction or the other because of some sort of fear or confidence sentiment that's driving the price. And so that's what our the main thing that we're looking for, that's what gives us our edge is, okay, we see this, maybe there's a consolidation and then there's a breakout to the high side or the low side. Well, that breakout is confidence or fear that's been sparked. And there's some movement of a reasonably significant number of or portion of the market that's moving the price. That's where we have our edges. We've seen the beginning of that movement, we've identified it. We can get in and we can write it, it was until it's exhausted or we hit our target and then we get out. But the thing is, when things are volatile, you're seeing a lot of movement, but it's not momentum. Momentum is when you have a significant number of players moving the price. There's a general sentiment movement in the market can be something as a small handful or even an individual speculating and moving the price and causing the candle to wick up. Or if they happen to hit it at the end of the period, that's a close, but it isn't momentum. And so it's really important to understand the premise of your strategy. Am I looking for some momentum in one direction or another that's going to go for a certain distance and I can identify that and I can ride it out? Or are you looking for just noise? Because almost nobody's looking for just noise, unless you're going to be, except for like high frequency traders, where you can respond fast enough to trade noise. But if you got a momentum strategy, you got to be careful when the markets are just noisy and there's a lot of movement, but it's not momentum, because your strategy is saying, I want some momentum, I want it. I want the move once it starts to.
