1. Track the balances between supply and demand with straight lines along swing points, swing lows if price is rising, swing highs if it’s falling. If price is ranging (moving sideways), your lines will be lateral.
2. When price breaks a line, exit. If it was trending and takes off in the opposite direction (a reversal), or if it was ranging and breaks out of that range (a breakout), wait for a pullback (a retracement).
3. Enter on that retracement, a few ticks above the trough of a \/ retracement or a few ticks below the crest of a /\ retracement, and stay in until your line is broken. And by "broken" I don't mean that price just pokes the line. As long as buyers are in charge , stay long. If sellers are in charge, stay short.
4. When the line is broken, exit and wait for a retracement in the opposite direction.
5. Continue until you enter chop (two consecutive trades that don't go anywhere and are accompanied by a higher low and a lower high, i.e., not trending.
6. Wait patiently. Quit when you get tired and start to lose focus.
2. When price breaks a line, exit. If it was trending and takes off in the opposite direction (a reversal), or if it was ranging and breaks out of that range (a breakout), wait for a pullback (a retracement).
3. Enter on that retracement, a few ticks above the trough of a \/ retracement or a few ticks below the crest of a /\ retracement, and stay in until your line is broken. And by "broken" I don't mean that price just pokes the line. As long as buyers are in charge , stay long. If sellers are in charge, stay short.
4. When the line is broken, exit and wait for a retracement in the opposite direction.
5. Continue until you enter chop (two consecutive trades that don't go anywhere and are accompanied by a higher low and a lower high, i.e., not trending.
6. Wait patiently. Quit when you get tired and start to lose focus.
Straight Line Approach, The (the SLA)
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