Using Tom Demark Trend Line can profit on all timeframes down to M15. Scalpers and long term traders can profit from this. Also, you might not wait on a break of a trend line but can trade its bounce.
Introducing a set of breakout qualifiers, a trendline breakout will become an ideal entry price level for a trade in the direction of the new trend. Alternatively, if the breakout fails to meet any of the qualifiers, it will enable the astute trader to trade against the anticipated trend. Here are the breakout qualifiers:
Upside breakout qualifiers
Qualifier 1:
The price bar prior to an upside breakout must be a down close.
Qualifier 2:
The current price bar’s open must be greater than both the current TD Supply Line and the previous price bar’s close and must then trade at least one tick higher.
Qualifier 3:
The previous price bar’s close plus the previous bar’s “buying pressure” must be below the current price bar’s TD Supply Line price level.
Qualifier 4:
The current price bar’s open must be above both the previous two price bars’ closes, and the current price bar’s TD Supply Line must be above the previous price bar’s high.
Downside breakout qualifiers
Qualifier 1:
The price bar prior to a downside breakout must be an up close.
Qualifier 2:
The current price bar’s open must be less than both the current TD Demand Line and the previous price bar’s close and must then trade at least one tick lower.
Qualifier 3:
The previous price close minus the previous bar’s “selling pressure” must be above the current price bar’s TD Demand Line price level.
Qualifier 4:
The current price bar’s open must be below both the previous two price bars’ closes, and the current price bar’s TD Demand Line must be below the previous price bar’s low.
