One Line

Organized Volatility: More One-Line Practice

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In this video, I follow up on the trend line exercise I introduced in the last post. The exercise is designed so that you can learn about markets and price flow in your own experience. There is beauty and harmony in each chart that shows the footprints of the buyers and sellers.

To most people, the price action on a chart looks chaotic. It’s not chaotic, you need to learn how to look, and how to see. This is the beginning of designing a structured method for trading and it starts with some openness and curiosity.

This trend line practice isolates 2 confirmed swings with the same size reaction legs. By identifying two same-sized swings, we have found some organized volatility and behavior. We can then participate in that continued behavior or have a way to know when it changes.

Shane

One-Line Practice: Set Yourself Aside And Follow

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In this video, I set up a trading plan and introduce a trend line exercise you can practice in any market and in any time frame. There is no one right way to draw a trend line, it’s a matter of function and what you are trying to see. We will be drawing a trend line off two relative (same size swings). This will identify the footprints of organized volatility on a chart.

This exercise is designed so that you can learn about markets and price flow in your own experience. Its objectives are:

  1. Learn to isolate relative market structures.
  2. Learn to set yourself aside and follow price no matter what price is doing.
  3. Allow the practice and price flow to teach you.

We first need to make some objective swing definitions:

  • Confirmed Swing High/Low: A new high confirms a swing low and a new low confirms a swing high.
  • Balanced/Relative Swing: Same size reaction legs.

One Line Practice Instructions:

  1. Identify two confirmed relative swings
  2. Anchor a trend line at the two lows and make observations (not expectations) about how price interacts with the line.
  3. Always follow the last two relative confirmed swings with the trend line.
  4. Draw a box across the top of each swing and observe how price interacts with the boxes.

By identifying two same-sized swings that confirmed new highs, we have found some organized volatility and behavior. We can then participate in that continued behavior or have a way to know when it changes.

Shane

Following Swings Into the Gap on the Left

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In the previous post “Gap On The Left”, we looked at a simple, relaxed way to read and follow markets. In this post, were going to combine that with relative swings and follow price down into the gap on the left and let it tell us when it wants to turn back up. So often as traders, we ignore “what is” occurring in favor of what we think or want to occur. You can reference the post “One-Line Practice For Personal Insight” for practice in following swings.