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Azuremaster
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Postby Azuremaster » Mon Jun 29, 2009 12:34 pm

monolisa wrote:Azuremaster, might be you can describe how you come up with the zlines on the chart. I am sure MO and others would be happy to help you.

I am in a same boat as you - I have readed NLA twice and am re-reading it again. Here's my interpretation of zline (attached chart). Basically the line help us to idenity the price that most traders got "zeroed out" at their BE level.

Lis


Hey Lis, I am re-reading the thread again (3rd time and on page 235 at the moment lol).
From what I have read here, here is my understanding of zline: we have increase of momentum to the upside. The candle body is 2x larger than previous body. That means, we have traders that went long in the Mighty zone- from the open to 50% of body. Any Zline in the Mighty zone is a true Zline. Zero line is a line where traders entered long and when price returns to ZL, traders have zero profit and exit. We take long here. Vice versa for shorts.

Now, from what I know. If we see increase of momentum, we know that there is demand at that area(big boys bought there). Usually they will try to bring the price down again to the entry area(or ZL) and to hit the stops of other traders and to buy some more. After that the price will go up. This is another explanation of Zline concept.

P.S. looks like your ZL was good for short but it never happened.

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monolisa
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Postby monolisa » Mon Jun 29, 2009 1:17 pm

Personally my zline trade involves a breakout and a momo bar, and follow the saying "body in the direction of profit, wick in the direction of loss.

The chart was for a long trade. The candle after the momo bar "wicked" the zline and up it went :)
"Know your enemy and know yourself, find naught in fear for 100 battles. Know yourself but not your enemy, find level of loss and victory. Know neither your enemy or yourself, wallow in defeat every time." - Sun Tzu

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MightyOne
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Postby MightyOne » Mon Jun 29, 2009 3:13 pm

Zero Lines are only for discretionary traders and that is why there are only about 5 or so traders on this forum that make money with them.

They were meant to be analyzed on 4 hour or greater time frames!

If you want to use them on a 5m chart then go ahead and act a fool :lol:

Zero Lines do not signal trades!

Their purpose is to determine direction and areas where there is a low chance of draw down.

IF YOU DO NOT UNDERSTAND THIS PICTURE THEN ZERO LINES ARE NOT FOR YOU:

Image

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MightyOne
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Re: ZL

Postby MightyOne » Mon Jun 29, 2009 3:21 pm

I was referring to him answering posts so that I didn't have to :)

PTG wrote:
MightyOne wrote:It is times like this when I really miss ES PIP ;)

Azuremaster wrote:Hello everyone, here is my first try on zero lines.
Image

Trade #1: long, closed at a loss
#2: short, closed with profit
#3: short, closed at BE
#4: long, closed at a loss
#5: short, closed at a loss
#6: long, closed at a loss
#7: short, closed at a loss
#8: short, closed with profit
#9: short, closed at a loss
#10: long, closed at BE
#11: short, closed at BE
#12: short, closed at a loss
#13: long, closed at a loss
#14: long, closed with profit
#15: long, closed at a loss
#16: long, closed at BE
#17: long, closed at a loss
#18: short, closed at a loss

I have read the thread 2 times. Body in direction of profit, wick in direction of loss. Body is 2x larger than previous candle. 3 winning trades out of 18. Looks like I don't get this method. Any ideas?


@Azuremaster:
The name is es/pip
You can use the forum search function to check all his posts re. z-lines.

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MightyOne
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Postby MightyOne » Mon Jun 29, 2009 3:33 pm


Last box breakout on the 4H EJ:


Image

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Azuremaster
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Postby Azuremaster » Mon Jun 29, 2009 3:41 pm

monolisa wrote:Personally my zline trade involves a breakout and a momo bar, and follow the saying "body in the direction of profit, wick in the direction of loss.

The chart was for a long trade. The candle after the momo bar "wicked" the zline and up it went :)


I see, so you wait for the bar that wicked the zline to close and then go long?

Azuremaster
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Postby Azuremaster » Mon Jun 29, 2009 4:11 pm

MightyOne wrote:Zero Lines are only for discretionary traders and that is why there are only about 5 or so traders on this forum that make money with them.


OK

MightyOne wrote:They were meant to be analyzed on 4 hour or greater time frames!

If you want to use them on a 5m chart then go ahead and act a fool :lol:


Wow MightyOne, now I am totally confused. Looks like the fact that 90% of ZL charts I see in this thread are 5min and 15min is an illusion!

MightyOne wrote: Zero Lines do not signal trades!

Their purpose is to determine direction and areas where there is a low chance of draw down.


I see that Es/pip enters off 5/15 min ZLs. But now you say that ZLs do not signal trades...

MightyOne wrote:
IF YOU DO NOT UNDERSTAND THIS PICTURE THEN ZERO LINES ARE NOT FOR YOU:
Image


I think I can understand the concept. I see that you combine 6-7 4hr bars into one. And the zero lines are located in the lower half of that combined bar. But I don't understand why there are 4 ZL. And 200 pips stops? This is something new. You always taught that SL should be less than 20 pips and therefore we trade off 5min chart but not 4hr.

Thanks for your answers MightyOne, I really appreciate it!

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MightyOne
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Postby MightyOne » Mon Jun 29, 2009 4:13 pm

The wick in the direction of loss refers to arriving at the zone and trading in the direction of profit.

Body in the direction of profit

Arrive at the zone

Trade in the direction of profit

If price never falls back to the zone then trade in the direction of profit beyond the momentum bar's close.

Zero line Methods don't tell you when to enter they tell you in which direction and around where to enter.

Use your own entry method :!:

Azuremaster wrote:
monolisa wrote:Personally my zline trade involves a breakout and a momo bar, and follow the saying "body in the direction of profit, wick in the direction of loss.

The chart was for a long trade. The candle after the momo bar "wicked" the zline and up it went :)


I see, so you wait for the bar that wicked the zline to close and then go long?

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MightyOne
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Postby MightyOne » Mon Jun 29, 2009 4:36 pm

ES/PIP, Dragon, and I do not trade zero lines the same way.

Zero Lines do not signal trades, but if his entry method is to place an order on a zero line then the zero line is also his signal to enter.

Zero Lines are not a signal to enter, he just picked that method of entry to trade zero lines.

Small TF Charts:

Traders that trade small time frames generally do not hold onto profit or use stops worth targeting.

If I run them over it is because they just happened to be on the same road as a high TF trader.

You confuse the stops in the picture as being my own? :lol:



Azuremaster wrote:
MightyOne wrote:Zero Lines are only for discretionary traders and that is why there are only about 5 or so traders on this forum that make money with them.


OK

MightyOne wrote:They were meant to be analyzed on 4 hour or greater time frames!

If you want to use them on a 5m chart then go ahead and act a fool :lol:


Wow MightyOne, now I am totally confused. Looks like the fact that 90% of ZL charts I see in this thread are 5min and 15min is an illusion!

MightyOne wrote: Zero Lines do not signal trades!

Their purpose is to determine direction and areas where there is a low chance of draw down.


I see that Es/pip enters off 5/15 min ZLs. But now you say that ZLs do not signal trades...

MightyOne wrote:
IF YOU DO NOT UNDERSTAND THIS PICTURE THEN ZERO LINES ARE NOT FOR YOU:
Image


I think I can understand the concept. I see that you combine 6-7 4hr bars into one. And the zero lines are located in the lower half of that combined bar. But I don't understand why there are 4 ZL. And 200 pips stops? This is something new. You always taught that SL should be less than 20 pips and therefore we trade off 5min chart but not 4hr.

Thanks for your answers MightyOne, I really appreciate it!

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Look MA..........no stops or limits

Postby razorboy » Mon Jun 29, 2009 4:44 pm

Ya, I manufacture clear shoe boxes.....http://www.clear-shoe-boxes.com.............who would have thunk!

http://thejoshkerbelproject.com/

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