Advanced Charting Techniques for High Probability Trading: The Most Accurate And Predictive Charting Method Ever Created

CHAPTER 2

Straight-Lin Chart

The first indicator we establish is a simple, straight-line chart. Those familiar with Compound Stock Earnings (CSE) trading techniques are very accustomed to looking at charts and analyzing them. The function of the simple straight-line chart remains the same: We use it to identify the current cycle of the stock and the position in the current cycle and to see the regular and inverted bias V.

A line chart presents a graphic image (albeit limited) of where the price of a stock has traveled over a given time period. The closing prices are often seen as the most important ones to track. We follow closing prices to enter and exit positions and to apply all CSE management rules. All line charts will produce Vs. The challenge for any trader tracking a line chart is validating the V. All of the technical indicators we study have been applied, tested, and back-tested to validate the V. We therefore will be able to determine whether a V is true or false.

Validating the V is the single most important skill that traders must learn. Mastery of this skill will improve your timing when entering new positions and tethered slingshots (TSSs). It will also increase your patience and allow you to gain added confidence with your decisions. Your ability to master validating the V is based solely on your ability to understand several very important and simple technical indicators.

The chart in Figure 2.1 shows the simple line chart as it travels, creating Vs, or changes, ...