The Trouble With Scribbles

[Buy1Sell2]

I would actually also disagree that diagonal lines are better than horizontal ones. The horizontal lines represent actual values that everyone can see, that aren't just a line made up like a diagonal one. As you say, diagonal lines can be drawn very many different ways, so this makes it arbitrary. But if you ask someone to draw a horizontal line under the previous day low, there is only one way to do this.

Diagonal lines are dynamic in time. Horizontal scribbles are static in time. Drawing a line under yesterday's low doesn't mean anything with respect to what is happening today.

 

[Buy1Sell2]

But point being that everyone can see a horizontal line and everyone has to draw it the same, and if the line is a previous day high or low, you can bet that lots of traders are looking at it.

But they don't all draw it the same.

 

[Buy1Sell2]

I do like lots of things you write, like when you said that too much emphasis is placed on being right but not enough on keeping losses small, letting profits run, and not needing a high win percentage.

http://www.elitetrader.com/et/index...w-a-straight-line.287955/page-67#post-4099117

Thank you.

 

[dbphoenix]

The SLA/AMT

 

[dbphoenix]

How to Draw a Trendline/Channel:

 

[k p]

Diagonal lines are dynamic in time. Horizontal scribbles are static in time. Drawing a line under yesterday's low doesn't mean anything with respect to what is happening today.

Actually, this is I think where you are quite wrong and something that I can confidently say through my own testing. On many days, price will often turn at an overnight high or previous day high, or overnight low, or previous day low. This tells me that lots of traders are aware of where price turned before, and they nobody wants to pay higher, or sell for lower again. The fact that these are static as you say makes it less arbitrary because there is no way to change this number, no way to "get it wrong".

Now it of course does't happen all the time, but I can say with much confidence that price levels along the horizontal make for excellent trade opportunities.

 

[Gringo]

Ignorance is bliss. Be active in using ignorance.

 

[dbphoenix]

Ignorance is bliss. Be active in using ignorance.

Unless one doesn't know enough to come in out of the rain . . .

 

[fortydraws]

They aren't all drawn the same way though. The lines differ from scribbler to scribbler.

When drawn according to DbPhoenix's clear instructions, they will all be drawn identically so long as the scribblers are using arithmetic scale.

 

[fortydraws]

When drawn according to DbPhoenix's clear instructions, they will all be drawn identically so long as the scribblers are using arithmetic scale.

Has ET been screwy for anyone else this weekend? When I pt the above post together, the last visible post was B1S2's, and then I hit enter, and I see I am very late tot he party. I wouold delete mine, since DbPhoenix already posted the same charts, but I think that those instructions cannot be repeated enough, so I will leave them, and likely repeat them as necessary.