Schizo, thanks for sharing your views on this. Do you remember all those threads we had here several years ago that had titles containing the phrase "If you can draw a straight line"? (some are pasted below; not sure if it's all of them). I remember that some past PA traders and frequent posters like Redneck and NoDoji participated in the discussions, which suggests there was some meat there, but I haven't really taken the time to read through them. Are you familiar with them and if so do you think there are similarities to the support and resistance lines that you are recommending... is there value there for learning PA...
That thread was created by @dbphoenix, and if I'm not mistaken, he's a disciple of Jack Hershey. Sorry but I steer clear from anything Jack says like a disease. I know who Redneck and NoDoji are. But I don't recall any of their strategies other than the fact that NoDoji promoted Al Brooks on more than one occasion. As far as PA is concerned, I'm sure our methods overlap in many ways than one. I mean there are only so many ways to draw a line. It all comes down to individual's interpretation of those lines. If you have any specific questions regarding PA, feel free to shoot my way.
Now that you've brought up the memory of Jack Hershey's trading method, I'm really not sure where to formally categorize his method, even though with all its convoluted lines it could (technically) be lumped into PA proper. One thing's for sure though. You want your chart to be as clean as possible. I would never be able to trade with a chart like this.
Same... I tried several times to get useful info from Hershey's posts but never could do so. Regarding the "If you can draw a straight line" threads, I don't think they were based on Hershey's stuff but instead were drawn from what they called "auction market theory". Apparently dbphoenix talked about it on other trading forums and even wrote a book about it: https://elitetrader.com/et/threads/dbphoenix-posts-journals.299468/
DBPhoenix produced the attached PDF to outline his method. Note: There is no author listed in the pdf. Another ETer stated to me credit goes to DBPhonix. DBPhoenix stuff is rooted in Wykoff, not Hershey. There are some similarities as Wykoff and Hershey are rooted in volume.
What you are looking at is the parallel channel component/methodology of Hershey. It's only one method, and can produce profitable results by itself. I am a Hershey disciple. Use it every trading day. One thing for sure... in real-time, you do remain engaged with the market and the chart!!
This reminds me Oliver Kell charts, This guy won the 2020 US Championship (+941%). The best books to study PA are chart themselves. PA isn’t a setup We don’t trade Price Action, We trade a positive expectation. Not every action is worth reacting. A good chart will forgive even the worst readers. A bad chart will punish even the best readers. If all you look at are naked charts, Obviously, after decades, you’re going to find patterns. Drives me Schizo. Done burnouts. So many way to read a single chart. All with their own costs and benefits. Personally I use mostly horizontal lines, Highs, lows and close. Faster and slower signals. Agree. Prediction isn’t necessary nor sufficient. I am pretty sure it’s way more profitable, To be dumb and follow price with the trend. I’ve found that even volume is BS Everything is already priced in. Volume correlates with the True Range. I’d rather have a nice Daily ROC than volume. Plus volume doesn’t take liquidity into account. I’d rather measure activity ADR wise. Thank you for sharing @schizo
Well, he must be one of Jack Hershey's acolytes. But if he made +941%, he obviously knows what he's doing. Anyway, thx for your insight.
I went over a few pages on that thread, but all the images he posted were deleted so it was quite hard to follow. I'll check out the other thread. Thx.
I do remember DBPhoenix and Spidey as the main proponents of Hershey's method. Believe it or not, I too tried to digest Hershey's teaching at one point, which turned out to be an exercise in futility. Trading, in my view, should not be so convoluted. But if you're able to pull it off and profit by it, kudos to ya.