I’ve traded for many years – about 20 to be precise. During the early years I read
everything I could get my hands on and tried several methods. The lessons learned
were not what to do, but what
to do, and yet I was looking for something more.
Chart patterns work very well for some people, but they didn’t do much for me. I saw
several head and shoulders patterns break to new highs; flags, pennants, and wedges
break opposite to what they were supposed to do. What was an eager, studious, young
trader supposed to do?
Finally it dawned on me – price! Price is the king of the chart. I started paying closer
attention to price action. My reading focused on those expert traders that relied most on
interpreting price movement.
What I learned became the foundation of my trading. It’s not a 100% foolproof method,
but it helps keep me in the winning trades and gets me out of the losers.
I call this method range lines. A range can be the difference between a candle’s high
and low or it can be the difference between two areas of price resistance. Learning how
to trade between these range lines is very profitable. I’ve built a series of trading
methods that revolve around the technique that I’m going to show you. It’s really a very
mechanical system and that’s why I like it. There is no emotion, just reaction. There is
no guesswork, but verifiable, actual numbers. It works on any time-frame and in any
market that is traded –with stocks, ETF’s, and indexes. You can see, before it happens,
where you need to be prepared to take action –
no more reacting
to a trade that moves
The advantage to trading for so long is that you know what works and what doesn’t –
most of the indicators, systems, and methods I’ve seen don’t work. Price is the key and
is the purist indication of accumulation and distribution. That’s why range lines are so
valuable — price has a memory and range lines demonstrate that concept.