Yes. diagonal lines are dynamic. Horizontal lines are not. The indicator method with price action will show where the traders are trading and creating tops and bottoms. It may be different today than it was yesterday. That is one of the issues with defining a range for today's trading based upon yesterday's trading. I suspect that the SLA folks probably drew a line across tops that occurred yesterday and overnight at maybe around 4355, but as you can see the price/indicator combo lets us capture the reversal slightly above 4365. --Now it could be argued that the SLA would allow the trader to capture the upside breakout above 4355, but only for 10 points or less. I can easily show that a simple cross of a downward sloping diagonal line drawn across the tops of the pullback on the left side of the chart would have you in at 4351 instead of above 4355. If the SLA trader waited for the pullback of the breakout above 4355, then the entries would be similar. So yes---diagonal lines are dynamic in time and not static like horizontal lines based upon yesterday's noise.
There may be times when the SLA scribble method produces and equal or better entry and exit, but does not allow for the trader to let the trade run to maturity. Bottom line---the scribble method does not produce superior entries and exits. Other methods are at least equal in their effectiveness and the real way to trade regardless of entry/exit method, is to cut losses and let winners run. Potential losses need to be calculated based upon TLNW.
Wow that's awesome just what I was looking for with by join this forum. I'll send u a screen shot once I get set up here
Unfortunately, it's all hindsight, and without knowing the rules, there's no reason to believe that any of these trades were actually taken. If this sort of thing is what one has been looking for, he will be disappointed in real-time trading.
And this is what I've stated in other threads including an old journal that I never followed through with. You're shorting the top of the range once it's overbought. You just use an indicator to qualify the extreme along with a divergence. Then you manage the position using a trendline to adjust your stop and to stay in. You get out when the indicator is oversold - or after the adjusted trendline was broken. Do you really not see how similar this is to SLA? Youre trading the extremes of the range and managing the position with trendlines. The indicator is just an additional qualifier that will be wrong on strong trending days, unless you have other criteria you follow. Not trying to be argumentative here either. I genuinely want to know if you see the similarities or not.
No. The SLA method trades based upon yesterday's range. The indicator price action combo range trades on today's range. It's dynamic. I use no horizontal scribbles. The methods are night and day.
And yet one winds up entering in the same place, only in real time, having planned the trade in advance: P.S. I do agree that the approaches are different. Since indicators lag, "Scribbles" will get you in sooner.
One other item: I focus more on trade management with respect to TLNW on intial risk. I then seek to obtain the fullest reward that I can and am not attempting to get 4 or 5 pts or 8 or whatever the target may be. I like the bigger winners to more than offset the inevitable losses. My main focus is on capital and using it prudently. That is keeping initial risk small and letting a trade run when I'm right.
Are you saying a method that's not being used by you cannot be used to make capital grow? Could it be conceivable in the mechanics of the universe to have maybe more than one method work?
Thanks for asking. No. There are numerous systems of entries and exits that can work. But they all need to contain prudent use of capital as their foundation. This is the most important aspect of trading and unfortunately is by and large ignored by most traders, students and educators. ---There is but one correct method of trading for the retail trader.--- 1. Keep losses small. (Never risk more than 2% of Total Liquid Net Worth on any one trade/idea.) 2. Let winners run using stops outside the noise. 3. Keep commissions small 4. Don't scale in or scale out.