STO - The STO Quick Learning Manual
STO - The STO Quick Learning Manual
11, 2014
THE STO QUICK LEARNING MANUAL
DISCLAIMER: Online trading involves substantial risk of loss and is not suitable for everyone.
The valuation of the contracts does fuctuate, and, as a result, you may lose more than your
original investment. The impact of seasonal and geopolitical events is already factored into
market prices. The highly leveraged nature of online trading means that small market
movements will have a great impact on your trading account and this can work against you,
leading to large losses or can work for you, leading to large gains. If the market moves against
you, you may sustain a total loss greater than the amount you deposited into your account.
You are responsible for all the risks and fnancial resources you use and for the trading
systems you are using. You should not engage in live trading unless you fully understand the
nature of the transactions you are entering into and the extent of your exposure to loss. If you
do not fully understand these risks you must seek independent advice from your fnancial
advisor. All trading strategies are used at your own risk. This mentoring should not e relied
upon as advice or construed as providing recommendations of any kind. It is your
responsiility to confrm and decide which trades to make. Trade only with risk capital; that
is, trade with money that, if lost, will not adversely impact your lifestyle and your ability to
meet your fnancial obligations.
!ast results are no indication of future performance.
In no event should the content of this correspondence and coaching e construed as an
express or implied promise, guarantee or implication from "hildren of the #ourney that you
will proft or that losses can or will e limited in any manner whatsoever. "hildren of the
#ourney is not responsile for any losses incurred as a result of using any of our trading
strategies and mentoring. The Trading software should never e left unattended due to the
possiility of events out of your control, such as computer or data failure, power outages,
position mismatches, and$or network prolems. %oss&limiting strategies such as stop loss
orders may not e e'ective ecause market conditions or technological issues may make it
impossile to execute such orders. %ikewise, strategies using cominations of trading positions
such as (spread) or (straddle) trades may e *ust as risky as simple long and short positions.
Information provided in this correspondence and coaching is intended solely for informational
purposes and is otained from sources elieved to e reliale. Information is in no way
guaranteed. No guarantee of any kind is implied or possible where proections of future
conditions are attempted.
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+evision %og,
-./0.1//..20- 3 A.!e4alo5a 3 added revised "ycle "oncept and the Awesome&67T Trading !lan.
-./0.1/../8.. 3 A.!e4alo5a 3 Total +evision to use the Awesome %ayout and Trading !lan.
-./8/./9./-88 3 A.!e4alo5a 3 added the :T7 3 +osa"han %ayout and Trading !lan.
-./8.08..-... 3 A.!e4alo5a 3 added practice replay from the middle of a sustained downtrend.
-./8.0-;./-.. 3 A.!e4alo5a 3 ma*or revision to the :T7 7<cial Trading !lan.
-./8.0.;./88. 3 A.!e4alo5a 3 added the :T7 7<cial Trading !lan.
-./8.0.8./=.. 3 A.!e4alo5a 3 added running marathons and market profle.
-./8.0.8./-.. 3 A.!e4alo5a 3 revised the Trading >ethod and added ?urt@s Trading !lan.
-./8.8/0./08. 3 A.!e4alo5a 3 added the !laygrounds and sprint vs marathons.
-./8.8././0.. 3 A.!e4alo5a 3 added mention of (The !erfect !icture Aook).
-./8.--1./;8. 3 A.!e4alo5a 3 created the :angha Bold & Ama5ing %ayout and 8&Cay DI:"I!%IEF Trading >ethod.
-./8.-/8..=8. 3 A.!e4alo5a 3 renamed the Aentley to the Awe:im Trading >ethod and removed the Delta teachings.
-./-//-2.-/8. & A.!e4alo5a 3 added minor additions and formatting.
-./-//-2./8.. 3 A.!e4alo5a 3 added the (6eart)G
-./-//-...9.. 3 A.!e4alo5a 3 initial revision.
+elated Documents,
Ce, http,$$childrenofthe*ourneysangha.logspot.com$
Ce, http,$$sanghatrading.logspot.com$
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"ontents
>ission :tatement......................................................................................................................................................../
>astery /
!%AIE %AEBHABF DI:"%AI>F+, 6
T6F :AEB6A !+IE"I!%F:, 6
The :T7 Iuick %earning >anual......................................................................................................................................0
!urpose, 0
:AJFTY, 0
:H+FTY, 1
!+7JITAAI%ITY, 1
:T7 allows us to know the two types of >arket Dance Aehavior,....................................................................................1
The :T7 >indset,....................................................................................................................................................1
:T7 Aenefts...........................................................................................................................................................1
"onKuer the Jear,....................................................................................................................................................2
?nown Jacts aout :T7,...........................................................................................................................................2
The A3e(o4e L#,ou' 10
The ACF:7>F&%7T Trading !lan, LJor trading the /... tick chart as your >AIEM 11
The ACF:7>F&67T Trading !lan, LJor trading the ;... tick chart as your >AIEM 12
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:T7 7<cial Boals, %imits and >antras... 12
>AET+A:, 15
Aegin your 9. Day "ountdown to %ive,......................................................................................................................14
Teachings,..................................................................................................................................................................1/
This is the 6FA+T of NThe Awesome Trading !lanN........................................................................................................1/
Chat are the EA++7C:..........................................................................................................................................10
The "ycle concept,.................................................................................................................................................12
The !+I>F & #F+? & DF%TA lines,................................................................................................................................21
The Three >arket "ycles,........................................................................................................................................22
The IE and :!IE lines,.............................................................................................................................................25
The A%!6AOA%% line and A%!6AO67T ars,.................................................................................................................24
Fnd of Teachings....................................................................................................................................................2/
"onclusion,.................................................................................................................................................................2/
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Purpose
This is the collective Cisdom our :piritual "ommunity of Traders had een made privy to
y the Hniversal Intelligence of %ove.
This manual is a compendium of knowledge we as individuals and as a community continue to learn with appreciation
and gratitude.
Mission Statement
Ce elieve in the Divine and the Hniverse. Ce are eternally Brateful and ever Thankful for the Bift given.
Ce are continually given the most ama5ing insights aout this BiftP which allowed us to create a usiness that takes little of our
time to run during the day. This Bift enales us to spend Kuality time helping others as the Divine wishes. This is the reason we
teach this Bift to others. Ce depend on the Divine and the %ove of the Hniverse to lead others to us.
!astery
It is what NisN, you are seeing what you (see).
It is A%% in the techniKue and your e<ciencies.
You can@t predict the future trends of the market,
you are ut a mere follower, so act like itQ
You must only develop the aility to see what is efore your eyes.
The Hniverse is asking for little more in this endeavor.
!ractice eing e<cientQ
!oints per trade, get it up.
%ike Dirk Eowit5ki in the EAA at -.; points per hoop.
LThe est average near him is /.8M.
Eot like >onica %ewinsky, who swallowed many a shot, ut didn@t get credit for one.
Hsing the least time and e'ort, a skilled performance R FJJI"IFETQ
Ce will ecome (>adly) skilled in this area. ?urt DuerodG
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"#$%N #$N&'$&( )%*+#$%!(,-
/. The :angha will never ask you for money.
-. The info I: !+7SIDFD J+FF%Y with Nno strings attachedN.
8. The :angha will provided answers and guidance pertinent only to (The :angha Trading 7scillators L:T7M).
0. The :angha CI%% E7T provide proof of e'ectiveness nor AEY guarantee of JITEF:: of use. !rove it to yourselfQ
;. You are J+FF to proft from (The :angha Trading 7scillators) in any way you choose, with only 7EF +F:T+I"TI7E 3
Bive credit to (The "hildren of the #ourney :angha) as the original creator.
T.( *$N&.$ ",%N+%"#(*-
/. Those that have the passion and perseverance, on their own volition, will prove the merits of NThe BiftN for
themselves and acKuire the necessary skills y their 7CE e'ort.
-. As NThe BiftN was freely given to the :angha, we J+FF%Y give the gift from our heart to those who ask us. The
:angha will freely answer Kuestions and provide the foundational knowledge to those who seek to use NThe :angha
Trading 7scillators) e'ectively.
8. The Bift of NThe :angha Trading 7scillatorsN is 7pen :ource and will adhere to the N1 Buiding !rinciplesN of 7pen
:ource.
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The STO Quick Learning Manual
"urpose-
This document is the :angha Trading 7scillator TeamTs latest understanding on how to use NThe :angha Trading 7scillators)
proftaly using (The Awesome %ayout and Trading !lan). Ce include all the Tactics and :trategy, we currently know of, for :afe
and :ure 3 proftaility.
Chen you have your frst&look at the :T7 tools used in the Awesome %ayout Lon the :ierra"hart Trading !latformM, please do E7T
e overwhelmed y all the lines. You will learn their function as you execute (The Awesome Trading plan). !lease learn aout the
EA++7C:, which is foundationalP we need EA++7C: to clearly see the rhythm of the market dance and to alert us when the :T7
lines are ready for the next market cycle.
*$/(TY-
Protect our tra!ing account, we employ the following tactics...
/. Hse a :top and move it to the last (ounce) of the price&action Lwhere the price&action created a peak or valleyM.
-. AF 7AFDIFET to the trading plan.
8. Hse only 7EF contract and ?eep your max daily loss to less than U/;. L%oss %imitM.
0. ?eep your max daily flled trades to less than /- L7ver Trading %imitM.
"AR#I#$: Doing %usiness &ith the Market is 0inherently0 )$N&(,O'*' Market price(
action ma sharpl go up or !o&n) PRE*E#TI#$ our Stop +rom acti,ating in a timel
manner- Please reali.e ou "ILL LOSE mone &hen this happens an! this is a /normal/
%eha,ior o+ the market-
As a ne& STO practitioner) ou are encourage! to use O#L0 one contract at a time) to
minimi.e this possi%le loss-
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*',(TY-
%ook for and wait for (The Trade :etup).
",O/%T$1%#%TY-
/. E1IT your position when you have (The Trade Fxit).
-. 2E"ARE 3 STA0 A"A0 when the market is sideways and :T7 lines *ust stay in the DAEBF+ V7EF.
STO allo&s us to kno& the t&o tpes o+ Market Dance 2eha,ior:
/. Sustaine! Tren!s 45o6trot7 3 Aegins when !+I>F and IE lines cross Vero together, then the IE line stays
in the DAEBF+ V7EF as #F+? remains 7HT:IDF the >ID EA++7Cs and !+I>F cycles up and down through
the Vero.
-. Si!e&as an! Pi,oting 48itter%ug7 3 is a sign of continuation of a current trend. The IE line remains in
the DAEBF+ V7EF and #F+? is J%AT.
The STO Min!set:
/. NDAE"FN with the marketP we DO #OT PREDICT where it is going.
-. (67!F) will not move the price&action to where we want it to goQ
8. >arket direction is always known through the :T7 lines.
STO 2ene9ts---
/. gives us the J+FFD7> of sight and awareness.
-. gives us the FEF+BY to trade for a long time Lif we want toM & due to %ess Jrustrations.
8. J+FF for everyone to use Lexcept for the monthly cost of a :ierra "hart suscription & U-1 per monthM.
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Con:uer the 5ear:
1. 5ear o+ Missing an Entr & when entering a position, :T7 does >arket Auy and :ell.
2. /ear of the ,etrace taking you out - because with STO we know when to open up the Stop.
3. 5ear o+ the Si!e&as & going in and out of positions & ecause with :T7 we know trend continuation Lfat means
continuedM.
4. 5ear o+ 2a! Risk Management & :top too tight or loose & ecause with :T7 we know the market dance.
5. 5ear o+ #ot ;no&ing where the market is & ecause with :T7 we know where the market will go.
6. 5ear o+ Losing 3 ecause with :T7 we know when to take a position, when to hold and when to exit.
;no&n 5acts a%out STO:
/. All :T7 lines cycle through Vero. Chen a line goes aove the Vero, it will go elow the Vero and vice&versa.
The cycle has an Fxpansion phase, when it moves away from Vero and a "ontraction phase, when it moves ack towards
Vero.
Take a position when A%% the :T7 line cycles are in Fxpansion or take an opposite position when A%% the :T7 line cycles
are in "ontraction.
-. Chen !+I>F and #F+? are AA7SF Vero, market tends to dance H!.
8. Chen !+I>F and #F+? are AF%7C Vero, market tends to dance D7CE.
0. !rice&action will not mo,e Kuickly until !+I>F or #F+? crosses the Vero.
;. Chen #F+? is sideways AA7SF the H!!F+ >IDs, the market will continue to dance H!.
9. Chen #F+? is sideways AF%7C the %7CF+ >IDs, the market will continue to dance D7CE.
1. Chen :T7 lines are in the DAEBF+ V7EF, the market continues its current trend.
=. An :T7 line Vero Aounce is strong.
2. An :T7 line NcheckmarkN pattern is strong.
/..:T7 lines are together during Vero crossing is strong, ut short&lived L#itterugM.
//.Chen :T7 lines do not match price&action direction, you have DISF+BFE"F.
/-.Any :T7 lines crossing Vero or each other has signifcance.
/8.Any (%FA!) of the :T7 lines will cause price&action to go sideways.
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The Awesome Layout
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*TO 2 O3cial Trading "lans...
There are TC7 Awesome Trading !lans.
The ACF:7>F&%7T Trading !lan is for trading the /... tick chart as your >AIE chart.
The ACF:7>F&67T Trading !lan is for trading the ;... tick chart as your >AIE chart.
Pre(Plan:
+eKuirements,
/. Hnderstand the +I:? of 7nline Day&Trading L+isks, Day&TradingM
-. Ae Jamiliar with the :ierra"hart Trading !latform L:ierra"hart InstructionM
8. "alirate the :T7 EA++7Cs to the fnancial instrument traded L"alirating the EarrowsM
0. Hnderstand the EA++7Cs and the concept of "ycles with Fxpansion phase and "ontraction phase L"alirating the
EarrowsM
!re&reKuisites,
/. :erene, 6ealthy and Alert
-. "omputer, Internet and Trading !latform are well
8. Boals, %imits and >antras reviewed LBoals, %imits, >antrasM
0. In isolation & no distractions
The $4(*O!(2#OT Trading "lan- LJor trading the /... tick chart as your >AIEM
!lan Fxecution,
/. "AIT' & CAIT for #F+? to e in your direction and IE line to already e at the correct side of Vero as !+I>F crosses Vero.
IE line and !+I>F >H:T AF fairly "%7:F together as you cross Vero.
-. E#TER' 3 when !+I>F crosses Vero and A%!6AOA%% crosses A%!6AO67T, with #F+? going your direction. 4The Tra!e
Setup7
<- E1IT' 3 when !+I>F enters the DAEBF+ V7EF as IE line crosses Vero. 4The Tra!e E6it7
a. Chen more than negative ; ticks.
. Chen price&action is sideways.
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The $4(*O!(2.OT Trading "lan- LJor trading the ;... tick chart as your >AIEM
/. "AIT' & CAIT for :!IE and #F+?O67T to e in your direction.
-. The Tra!e Setup 3 LO#$ 3 E#TER LO#$ 3 when A%!6AOA%% creates a AH%% fag or crosses Vero or crosses a A%HF
A%!6AO67T.
8. The Tra!e E6it 3 LO#$ 3 E1IT LO#$ 3 when A%!6AOA%% crosses the !rice&Action or runs into a +FD A%!6AO67T.
0. The Tra!e Setup 3 S=ORT 3 E#TER S=ORT 3 when A%!6AOA%% creates a AFA+ fag or crosses Vero or crosses a +FD
A%!6AO67T.
;. The Tra!e E6it 3 S=ORT 3 E1IT S=ORT 3 when A%!6AOA%% crosses the !rice&Action or runs into a A%HF A%!6AO67T.
Post(Plan:
Hpdate Trade #ournal log site
/. +ecord goals reached
-. +ecord limits and mantras roken
8. +ecord Kuality of 7AFDIFE"F to the Trading !lan
0. +ecord things learned
;. +ecord proft or loss and numer of flls
Do re&capP Sideo or :creenshot the charts and add to log site
*TO O3cial &oals, #imits and !antras...
$OALS:
You are an F>!%7YFF and >H:T AF 7AFDIFET to the NThe Trading !lanN
You trade only one contract at a time
You A%CAY: CAIT for (The Trade :etup)
You A%CAY: execute (The Trade Fxit)
LIMITS:
>aximum daily flls, /-
>aximum daily %7::, -; ticks
Trailing :top, /= ticks
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RIS; MA#A$EME#T: ( 2est to Skpe an! tra!e &ith a Tra!ing 2u!!- Your Trading Auddy will manage your risk
and you will manage theirs.
:T7! after two losses in a row or you@ve reached your daily loss limit, when you have no Trading Auddy.
!$NT,$*-
/M The market pays you to AF 7AFDIFET to The Trading !lan.
-M Don@t claim to e oedient, if that is not the case /..W.
8M 6alve the numer of contracts you trade when trading poorly.
0M Eever turn a winner into a loser.
;M Your iggest loser can@t exceed your iggest winner.
9M :tick with the plan, do not change it.
1M Ae yourself, do not try to e someone else.
=M You always want to e ale to come ack the next day.
2M Farn the right to trade more contracts at one time.
/.M Bet out of your losers.
//M The frst loss is the est loss.
/-M Don@t hope and pray. Chen you do, you will lose.
/8M Don@t worry aout news its history.
/0M Don@t speculate$predict. Chen you do, you will lose.
/;M %ove to lose money.
/9M If your trade is not going anywhere in a given timeframe, then exit.
/1M Eever take a ig loss. 7nly a ig loss can hurt you.
/=M >ake a little it each day. Dig your ditches. Do not fll them.
/2M 6it singles not home runs.
-.M "onsistency uilds confdence and control.
-/M %earn to sweat out L:cale outM your winners Lwhen using multiple contractsM.
--M >ake the same type of trades, repeatedly. Ae a ricklayer.
-8M Do not over analy5e. Do not procrastinate. Do not hesitate. Chen you do, you will lose. Ae AlertQ
-0M All traders are created eKual in the eyes of the market.
-;M It is the market itself that wields the ultimate scale of *ustice.
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The Quick Learning Training program:
/. Do your 6istorical "hart studies.
a. %ook for The Trade :etups, where !+I>F starts from outside the >ID&EA++7Cs.
. %ook for The Trade Fxits, where !+I>F enters the DAEBF+ V7EF, as IE line crosses the Vero.
-. Do %ive&Demo of the >arket and e 7AFDIFET to the trading plan.
8. %et the Hniverse teach you the details as you do your 9. Day countdown to %ISF.
2egin our >? Da Count!o&n to Li,e:
/. Ae 7AFDIFET to the trading plan
-. Hse only / contract at frst, as your weeks go y proftaly, doule your contracts. Chen not proftale, go ack to /.
8. >aintain a trade *ournal and video recap your daily countdown.
0. Chy videoX Aecause you need to record your thinking on why you did that action.
;. After taking a Areak, do your 6istorical :tudies of recogni5ing when the +FD&B+FFE lines are J%ATTI:6 and when they are
outside the EA++7Cs.
9. Do >arket +eplay, catching at least 8 +FD&B+FFE lines entering the EA++7Cs, proftaly. ?eep replaying the scene until
you maximi5e your proft.
Sh#$e ,ou$ %(&h'( 3'h o'he$ STO -$#!''o%e$(. I% f$eel, (h#$%& ou$ *(!o)e$e(, 3e h#)e 4#*e (u!h 3o%*e$ful -$o&$e((6
OBEDIENCE to the trading plan is paramount and staying within your Loss and Filled Trade Limits!
@- Tra!e TIC;S #OT MO#E0'
A- TRAI#) TRAI#) TRAI# 3 0ou ha,e to act on The Tra!e Setups an! E6its BInstinctuallC'
<- PRO*E e,erthing to oursel+'
D- Tra!e "IT=OET emotions'
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Teachings,
This is the =EART o+ /The A&esome Tra!ing Plan/---
#ust study this section and practice, practice, practice, always practiceG
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Quick PRIMER on the STO lines an! &hat the are:
/. The Fero Line 4Fero7 & is foundational to :T7. Cithout the NVeroN, we will not know the various cycles the
market goes through. :T7 essentially places a Vero line on the price&action & this is the source of power for
:T7.
-. The I# 4I#7 3 is the fastest speed :T7 line, predicts where the !+I>F will go next.
8. The SPI# 3 is the IE line of the 6igh&7rder Timeframe, when The Trade :etup is present, use :!IE to confrm
the strength of the direction.
0. The PRIME 4P7 3 is the medium speed :T7 line, tells us the marketTs short term cycle. "hen /P/ crosses
the Fero line) it &ill mo,e the price.
;. The 8ER; 487 3 is the slowest speed :T7 line, tells us the marketTs medium term cycle. Chen N#N crosses the
Vero line to go Hp, you are in an uptrend. The reverse is true for downtrends. #F+? is essentially the price&
action with a Vero line.
9. The ALP=AGALL 4ALL7 & tells us when The Trade :etup$Fxit is coming to time our entries$exits as
NA%!6AOA%%) crosses the (A%!6AO67T) ars.
1. The ALP=AG=OT 4=OT7 3 tells us the %ong&Siew 3 (%ooking down the +oad), when the market dance will
change, go from an Fxpansion phase to a "ontraction phase Lsee The "ycle conceptM.
In the A&esome laout) &e use the I#) PRIME) 8ER;(=OT) ALP=AGALL) ALP=AG=OT an! SPI#-
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"hat are the #ARRO"S---
Farly in our development of :T7,
the HEISF+:F taught us the importance of !+I>F and the signifcance of the EA++7Cs. The use of the EA++7Cs is very
important in allowing us to know the cycles of the market dance. The EA++7Cs allowed us to have a Vero line, where the most
exciting part of the market dance happens.
"ith the #ARRO"s) &e kno&H
/. "ontinuation as the price&action goes sideways or we are in (#itterug) La pivoting marketM. The IE line stays in the
DAEBF+ V7EF.
-. +eliale (Trade :etups and Fxits) as :T7 lines cross the Vero, together.
8. :ustained trends, as #F+? is fat outside the >ID&Earrows.
The #ARRO"s !e9ne an area a%o,e an! %elo& the ,er important Fero line-
Ce oserved that we can Ncali%rate/ the EA++7Cs to a specifc fnancial product or instrument.
Cali%rating the #ARRO"s to a 9nancial instrument:
/. Jind a True Trend "hange for H!.
-. Jind a True Trend "hange for D7CE.
8. :et the Hpper EA++7Cs LHpper is aove the Vero lineM aout where the #F+? starts a Downtrend.
0. :et the %ower EA++7Cs L%ower is elow the Vero lineM aout where the #F+? starts an Hptrend.
;. :ince we want the EA++7Cs symmetric around the Vero line the values for the Hpper and %ower Earrows are the
same.
Jor the TJ Lemini&+ussell -?M, B"% L%ight "rudeM, BB" LBoldM and F: Lemini&: and ! ;..M the Earrows is set to Y..1 and
&..1.
Ce then divide the Hpper Earrows in half and call it the Hpper >ID&Earrows.
Ce then divide the Hpper >ID&Earrows in half and call it the Hpper IHA+TF+&Earrows.
The same is done for the %ower Earrows.
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The area marked&out y the Hpper and %ower >ID&Earrows aout the Vero line & we call the MIDs.
The area marked&out y the Hpper and %ower IHA+TF+&Earrows aout the Vero line & we call the )$N&(,25ON(.
!lease see the cali%ration ,i!eo at this location or email childrenofthe*ourneyZgmail.com for help,
https,$$dl.dropoxusercontent.com$u$;/;=2;18$TheW-.:anghaW-.TradingW-.:ystem$Sideos$:T:W-.&W-."alirating
W-.!+I>FW-.andW-.#F+?W-.toW-.theW-.Earrows.J%S
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The Ccle concept:
As any of the :T7 lines cycle up and down through the Vero line, they create two phases.
The Phases o+ a CcleH
The EXPN!ION Phase . #( 'he STO l%e !$o((e( 7e$o #%* pulls away f$o4 'he 7e$o.
The CONT"CTION Phase 8 #( 'he STO l%e $e#!he( # -e#"9)#lle, #%* heads towards 'he 7e$o.
#se the Cy$le phase to your ad%antage&
ONL' ma(e a trade when LL 'he STO l%e( e%'e$ )CONT"CTION * +ED! BC,- 'o3#$* 'he 7e$o.
.a(e a !#"E trade when 'he :RIME !$o((e( 7e$o #%* ALL 'he STO l%e( #$e % )EXPN!ION / P#LLIN0 1'- 2rom the 3ero.
!T' 1' when the 4E",5+OT ( NOT in phase with the other !TO lines6
1ut keep in mind that strong trends 4%## 1(&%N at "eaks67alleys when the *TO lines 87ees6'pside2down
7ees9 from outside the !%)s as $## the *TO lines enter their +ontraction "hase together.
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6ere is a picture to make the "ycle concept clear...
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The PRIME ( 8ER; ( DELTA lines:
The Hniverse let us know, with utmost certainty, that The !+I>F, #F+? and The DF%TA are the 7E%Y 8 lines needed to
NDanceN with the market :afely and proftaly 3 ut we needed the detail sight provided y the IE line and A%!6AOA%%.
The IE and :!IE lines lets us know where the !+I>F will go next.
The picture elow shows you why...
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The Three Market Ccles:
A%% the :T7 tools are lines that represent the inherent cycles in the market.
:o far, we know of Three >arket "ycles exhiited y the !+I>F&#F+?& DF%TA ehaviors.
Short(term ccle 4Pi,oting Market7 ( PRIME & Hseful when the !+I>F *ust goes from Hpper EA++7C: to %ower
EA++7C: or when #F+? is in the DAEBF+ V7EF, then use the !+I>F to take positions on the :T+7EB side of the
market.
Me!ium(term ccle 4Tren!ing Market7 ( 8ER; ( Ese+ul &hen the market is in a tren!- E6it the tren! &hen
the 8ER; crosses through the Fero an! re(enter a sustaine! tren! &hen 8ER; crosses %ack again- The
8ER; goes si!e&as) usuall outsi!e the MIDs) to sustain a tren! an! the PRIME &ill then %e in
DI*ER$E#CE to the price(action-
Long(term ccle 4Sustaine! Tren!ing Market7 3 DELTA 4&hich is PRIME minus 8ER;7 & Ese+ul &hen ou
&ant to ma6imi.e our pro9ta%ilit- "e !o not tra!e &ith DELTA) %ut instea! use ALP=AGALL &ith
ALP=AG=OT-
ALL these lines ccle up an! !o&n through the .ero as the market /Dances along/-
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The I# an! SPI# lines:
The I# an! SPI# lines are---
I# R !+I>FLcurrentOarM 3 !+I>FLpreviousOar ; to /. ars ackM
SPI# R !+I>FO67TLcurrentOarM 3 !+I>FO67TLpreviousOar ; to /. ars ackM [67T is 6igh&7rder Timeframe
chart\
The :!IE line is derived from the 6igh&7rder Timeframe chart, which gives us (a look down the road)&the market may
travel, and is plotted on the >AIE chart, using a %ow&7rder Timeframe&focusing on the short&term&(looking at the hood
ornament)&instead of looking down the road.
Ce do our trading o' of the >AIE chart L%7TM and the 67T chart gives us the long&term view of the market dance.
=o& the I# an! SPI# lines helps---
Hsing the IE and :!IE lines gives us confrmation of market direction and surety of trend continuation.
The IE line predicts where the !+I>F will go and we need to know if the !+I>F will e going away from the Vero
Lexpansion phase of the cycleM or is the !+I>F going towards the Vero Lcontraction phase of the cycleM. Ce >H:T take
positions when the !+I>F *ust crossed Vero and is doing an FxpansionQ
The :!IE line confrms the market direction and strength. Chen :!IE is elow Vero, the price&action is still D7CE.
Chen :!IE is aove Vero, the price&action is still H!. The distance the :!IE is from Vero is the strength of the market
in that direction.
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The ALP=AGALL line an! ALP=AG=OT %ars:
The ALP=AGALL an! ALP=AG=OT are---
ALP=AGALL R "7>A7OAL%7TM Y "7>A7OA L67TM
o COM2OGA R !+I>F Y #F+?
ALP=AG=OT R "7>A7OAL67TM
"7>A7OA is an :T7 line derived from the addition of !+I>F with #F+? for a specifc timeframe. Chen "7>A7OA
crosses #F+? going the same direction, it is usually a good place to take a trade.
The ALP=AG=OT makes ovious the phase changes o+ the market ccle. The ars will step in height and change
color as the cycle phase change.
The ALP=AGALL gives us con9rmation o+ the ,ali!it o+ the Tra!e Setup Lwhen using the Awesome&%7T Trading
!lanM. Chen the IE and !+I>F lines cross the Vero, the A%!6AOA%% must cross the A%!6AO67T.
He$e ( # -!'u$e 'o e;-l#% fu$'he$...
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En! o+ Teachings---
"onclusion,
There is no 6oly Brail of technical indicators. The est an :T7 practitioner can do is to NDanceN with the market.
The STO Tools gi,en to us % the Eni,erse is a !%,$+#('
"hen &e are #OT Pro9ta%le---
it is %ecause o+ our LAC; o+ Trust in the tools an! our LAC; o+ O%e!ience to the tra!ing plan-
2lessings Al&asH
Arnul+o PeIalo.a an! ;urt Duero! o+ the STO De,elopment Team
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