As the saying goes, and I believe already stated in this thread, one man's garbage is another man's treasure. This is exactly what makes a market.
I'm illustrating a practical difference between linear techniques (such as trend lines) and non-linear techniques (elastic band). In my opinion trend lines are less efficient than some other methods. At the same time I'm trying to investigate an objective efficiency of trend lines in conjunction with some entry/exit rules. That is what I'm doing.
Your effort is commendable but given your limited knowledge of trendline methods, your research just cannot be objective. I do not know much about your elastic band( bollinger based ? ) but it does not appear to have predictive ability . Trendline methods have it. IMO effort should be made by those with resources and capacity to combine trendline based predictive methods and non linear or indicator based methods . Per example: Trendlines will highlits 12:20 well ahead of time. When time comes and you have a strong signal given by other method at 12:20 it is a go.
I don't really use channels but here is a current one on YM. I am watching the lower trend line though to signify weakness for my current long position.
The Elastic Band is not based on the bollinger channel at all. The graph below is an illustration of that. Its prediction value is based on assumption that when a band is broken price always retracts to a middle line (with profit or loss). My knowledge of trendlines without a question is a limited one but I'm trying to learn and test everything I could right now. As of today my belief is that the linearity of the market is a limited time event and does not exist all the time or even on al the time frames (bar length). I might be wrong, of course, but I thought it would be healthy to present my alternative point of view on this thread without knocking anything down. As I said before, I do recognize trendlines value I just don't think they work all the time because of everchanging market activity pattern. Having said that I do value your point of view and expect your help in my research of trendlines. Cheers.
Maestro, Key to using trendlines properly is to do it on different time frames and look for intersections . It is labor intensive and one must know what points, h/l to use . Feel free to ask . walter904us@yahoo.com
The simplest way to draw a trendline is to take two swing lows and join them up and extend the line into the future, or use swing highs to draw an upper trendline, technically it should be 3 points to draw a trendline, but I don't see why it should be as you are just getting a rate of change.