Ghost of If You Can Draw A Straight Line

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Thanks for that excellent addition to the pdf. I like how the 'think in terms of trader behavior' part comes before the actual gathering of stats - always emphasizing the goal instead of the means.

I have been severely lacking in the meticulous gathering of market stats. The document made me realize how much work is still left to do.
 
green.green said:
Good looking chart there Fluke. If you are interested in this approach I'd recommend a journal. I'm sure Db would too.
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Thank you. I have had one for going on two and a half years now. I do it in the form of a private blog, however. Psychologically speaking, trading is hard enough as is without the constant berating, belittling, and other nonsensical tirades common at ET.

Nonetheless, I wanted to join in here, if only briefly, to show my appreciate for DB's guidance, starting at TL, and later, here, as it has made all the difference in my journey from unprofitable trading to profitable trading. It is nice to see the growing number of SLA related journals building a "community" of traders-helping-traders.
 
Fluke said:
Thank you. I have had one for going on two and a half years now. I do it in the form of a private blog, however. Psychologically speaking, trading is hard enough as is without the constant berating, belittling, and other nonsensical tirades common at ET.
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You're welcome to start one in the WF at TL. I'm still a moderator there.
 
dbphoenix said:
You're welcome to start one in the WF at TL. I'm still a moderator there.
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Thank you DB, I've enjoyed my detailed (b)logging as I've done it, but it might be nice to have other eyes helping point out mistakes or shortcomings I do not notice.

I know there is primarily a lot of talk, at least more recently, of trend channels as ranges, but I believe some of the most influential of your posts for me was concerning lateral ranges and what to do with them, particularly the depth at which you "dumbed" it down:

"First, find a range, preferably one with an easily determinable upper and lower limit.

Second, determine where price is within that range.​
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Third, locate the extremes. If you have a range that is wide enough for you to trade that is, there are enough points from top to bottom to make a trade worthwhile) and price is at the bottom of that range, there is a good possibility for a long. If price is at the top of the range, there is a good possibility for a short.​
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At this point, you have three options: a​
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reversal, a breakout, or a retracement. If, for example, price bounces off or launches itself off the bottom of the range (support), trade the reversal and go long. If instead it falls through support, short the breakout (or breakdown, if you prefer). If you don’t catch the breakout, or you prefer to wait in order to determine whether or not the breakout was “real”, prepare yourself to short whatever retracement there may be to what had been support and may now be resistance." ​
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Not that applying this to trend channels is any different, it just stuck with me better, perhaps from the first comment my first mentor made to me: "Get very good at drawing horizontal lines." He was vague, however, and left a lot on the table for me to discover on my own. Reading those four paragraphs of yours made it "click". ​
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On that note, the below chart provided me with ample premise for the longs from 36 this morning. ​
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View attachment 145140


 
Yes, even though I re-introduced the box in the SLA-AMT pdf, I went into boxes several years ago, but they never really clicked.

If you've looked at Appendix E, you'll note I mention the "line in the sand". Those were clear yesterday and today and are every bit as useful as the box as far as trading exits from the box, or the range.

Not everyone is comfortable trading reversals, of course, which makes trading ranges very difficult unless they are exceptionally wide (the range, not the trader). Fortunately, they are not the only trading option.

As to the second entry on your 1m chart, it isn't exactly legal, so it's riskier. However, if one enters on the retracement with the idea that price will break the SL at the same time it confirms a successful retracement entry, one can fudge the whole thing and go for it. A failure will after all be quick and decisive.
 
dbphoenix said:
...As to the second entry on your 1m chart, it isn't exactly legal, so it's riskier. However, if one enters on the retracement with the idea that price will break the SL at the same time it confirms a successful retracement entry, one can fudge the whole thing and go for it. A failure will after all be quick and decisive.
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Understood. I was hesitant the second time back down there after once again rejecting 48/49, but I felt the two higher lows warranted an entry, particularly with the first higher low providing such a pop (10:13 EST bar). My plan allows for over-riding the SL break given the conditions of a) at support and b) sufficient display of interest in venturing from that support, which in this case, I believe, was displayed through the ability of the buyers to move beyond the initial reaction high of the 10:11 EST bar. Further, I suppose one could tighten their SL after the initial reaction at support, drawn down across the 10:11 EST bar, which would then be broken during the 10:13 EST bar.

Of course this is all hindsight at this point, but that was my thought process during the moment. As you say, if this were to be something someone chose to incorporate, they would of course need to go back and do the testing for themselves to determine if it is appropriate.

View attachment 145141
 
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