Sorry, had to do the NFP after-party trade and could not complete my post. This is my summary of what I was trying to explain.

Rather than having to create a method for measuring all the various portions of those complex formulas, the trading world was kind enough, or dumb enough, to put a time element to trading This makes life much easier.

Imagine if the high and low had no candles between it. You would have a whole bunch of data points where price was bought and sold. Just dots all over the place, but generally in some direction. With the introduction of candles, or bars, you create subsets of data as it moves from high to low, or low to high. Each subset contains a high, low, midpoint, and average. So, if you look at the average of each subset, and then average each subset from high to low, or low to high, you create an average of averages. This is the basis behind a regression line. Since you need a nonlinear regression line to effectively follow the market's momentum, you simply convert it to a moving average. Then you use an indicator that measures the effective range of your moving average. Then you apply standard deviation to the indicator to measure its momentum.

On the other hand you could create a regression line and trade between the lines and breakouts. It is not much different than trading per Fibonacci or Pivots, except that a regression line would most likely not be horizontal. But then you are back to hands on trading and guessing which line to trade against. Remember, I didn't want to have to draw lines on charts or make guesses. I want a picture that follows the market whether it bounces off a line or breaks through it. I compromised precision for consistency. Now I trade when price moves vertical, take my profit when it goes horizontal, and wait for the next vertical movement. For me, it is the correct way to trade. Trading is not about holding on for some percentage That is called investing.

Rather than having to create a method for measuring all the various portions of those complex formulas, the trading world was kind enough, or dumb enough, to put a time element to trading This makes life much easier.

Imagine if the high and low had no candles between it. You would have a whole bunch of data points where price was bought and sold. Just dots all over the place, but generally in some direction. With the introduction of candles, or bars, you create subsets of data as it moves from high to low, or low to high. Each subset contains a high, low, midpoint, and average. So, if you look at the average of each subset, and then average each subset from high to low, or low to high, you create an average of averages. This is the basis behind a regression line. Since you need a nonlinear regression line to effectively follow the market's momentum, you simply convert it to a moving average. Then you use an indicator that measures the effective range of your moving average. Then you apply standard deviation to the indicator to measure its momentum.

On the other hand you could create a regression line and trade between the lines and breakouts. It is not much different than trading per Fibonacci or Pivots, except that a regression line would most likely not be horizontal. But then you are back to hands on trading and guessing which line to trade against. Remember, I didn't want to have to draw lines on charts or make guesses. I want a picture that follows the market whether it bounces off a line or breaks through it. I compromised precision for consistency. Now I trade when price moves vertical, take my profit when it goes horizontal, and wait for the next vertical movement. For me, it is the correct way to trade. Trading is not about holding on for some percentage That is called investing.

You cannot be extraordinary by being normal

2