The GTO Quick Learning Manual

Nov.
23, 2016
THE GTO QUICK LEARNING MANUAL
DISCLAIMER: Online trading involves substantial risk of loss and is not suitable for everyone.
The valuation of the contracts does fluctuate, 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 financial 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 financial
advisor. All trading strategies are used at your own risk. This mentoring should not be relied
upon as advice or construed as providing recommendations of any kind. It is your
responsibility to confirm 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 financial obligations.
Past results are no indication of future performance.
In no event should the content of this correspondence and coaching be construed as an
express or implied promise, guarantee or implication from Children of the Journey that you
will profit or that losses can or will be limited in any manner whatsoever. Children of the
Journey is not responsible for any losses incurred as a result of using any of our trading
strategies and mentoring. The Trading software should never be left unattended due to the
possibility of events out of your control, such as computer or data failure, power outages,
position mismatches, and/or network problems. Loss-limiting strategies such as GTOp loss
orders may not be effective because market conditions or technological issues may make it
impossible to execute such orders. Likewise, strategies using combinations of trading positions
such as spread or straddle trades may be just as risky as simple long and short positions.
Information provided in this correspondence and coaching is intended solely for informational
purposes and is obtained from sources believed to be reliable. Information is in no way
guaranteed. No guarantee of any kind is implied or possible where projections of future
conditions are attempted.
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The GTO Quick Learning Manual

All Rights Reserved;
The Children of the Journey Sangha of the East Coast. Copyright, 2011-2017
Nov. 23, 2016
Revision Log:
20161101.1300 A.Pealoza initial revision.
20161123.1000 A.Pealoza added why the Bollinger_Band is so useful.
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Nov. 23, 2016
Contents
Mission Statement...........................................................................................................5
6
PLAIN LANGUAGE DISCLAIMER:

THE SANGHA PRINCIPLES:
The GTO Quick Learning Manual.........................................................................................7

Purpose:
SAFETY:
SURETY:
PROFITABILITY:
GTO allows us to know the two types of Market Dance Behavior:.......................................8

The GTO Mindset:.......................................................................................................8
GTO Benefits..............................................................................................................8
Conquer the Fear:.......................................................................................................9
Known Facts about GTO:..............................................................................................9
The GRACE Trading Operation Layout
10
GTO Grace Trading Operation...
11
Grace Trading Operations (GTO) Ver: 7.1 12

GTO Official Goals, Limits and Mantras...
13
MANTRAS: 14
Begin your 30 Day Countdown to Live:.........................................................................15
(Split the 30 days into Three Combines, where a Combine is 10 trading days each, with differing goals
and limits you wish to attain. For example, the Third Combine may use 2 contracts at a time per trade.)
..............................................................................................................................15
and staying within your Loss and Fill Trade Limits!.........................................................15
Quick PRIMER on the Trinity lines and what they are:
The Bollinger Band is needed:
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16
17

Nov. 23, 2016

What is DOUBT and GRACE...
18
The Phase Cycle concept: 19

End of Teachings.......................................................................................................20
Conclusion:
20
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Purpose
This is the collective Wisdom our Spiritual Community of Traders
were made privy to
by the Universal Intelligence of Love.
This manual is a compendium of knowledge, we as individuals and
as a community continue to learn with appreciation and gratitude.
Mission Statement
We believe in the Divine and the Universe. We are eternally
Grateful and ever Thankful for the Gift of the Trinity lines
(TRUST, LOVE and MERCY).
We are continually given the most amazing insights about this Gift;
which allows us to create a business that takes little of our time to
run during the day. This Gift enables us to spend quality time
helping others as the Divine wishes. This is the reason we teach
this Gift to others for free.
We depend on the Divine and the Love of the Universe to lead
others to us.
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Nov. 23, 2016
PLAIN LANGUAGE DISCLAIMER:

1. The Sangha will never ask you for money.
2. The info IS PROVIDED FREELY with "no strings attached".
3. The Sangha will provided answers and guidance pertinent only to the Trinity lines
and the Grace Trading Operations (GTO).
4. The Sangha WILL NOT provide proof of effectiveness nor ANY guarantee of FITNESS of
use. Prove it to yourself!
5. You are FREE to profit from The Grace Trading Operations in any way you choose,
with only ONE RESTRICTION Give credit to The Children of the Journey Sangha as
the original creators.
THE SANGHA PRINCIPLES:
1. Those that have the passion and perseverance, on their own volition, will prove the
merits of "The Gift" for themselves and acquire the necessary skills by their OWN
effort.
2. As "The Gift" was freely given to the Sangha, we FREELY give the gift, from our heart,
to those who ask us. The Sangha will freely answer questions and provide the
foundational knowledge to those who seek to use the Grace Trading Operations
effectively.
3. The Gifts of the Trinity lines and GTO are Open Source and will adhere to the "7
Guiding Principles" of Open Source.
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Nov. 23, 2016

Purpose:
This document is the Grace Trading Operations Team's latest understanding on how to
use GTO profitably. We include all the Tactics and Strategy, we currently know of, for
Safe and Sure profitability.
When you have your first-look at the GTO used in the Layout (works only on the
SierraChart Trading Platform), please do NOT be overwhelmed by all the lines. You will
learn their function as you execute the trading plan described in this manual. Please
learn about the DOUBT, which is foundational; we need the DOUBT to clearly see the
rhythm of the market dance and to alert us when the Trinity lines are ready for the
next market cycle.
SAFETY:
Protect your trading account, we employ the following tactics...
1. Use a Stop and move it to the last bounce of the price-action (where the priceaction created a peak or valley).
2. BE OBEDIENT to the trading operations.
3. Use only ONE contract and Keep your max daily loss to less than $200 (Daily
Loss Limit).
4. Keep your max daily filled trades to less than 8 (Over Trading Limit).
5. Met your Daily Profit Goal, END your Trading Day.
WARNING: Doing business with the Market is "inherently"

DANGEROUS! Market price-action may sharply go up or down,
PREVENTING your Stop from activating in a timely manner. Please
realize you WILL LOSE money when this happens and this is a
"normal" behavior of the market.
As a new GTO practitioner, you are encouraged to use ONLY one
contract at a time, to minimize this possible loss.
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SURETY:
Look for and wait for The Trade Setup.
PROFITABILITY:
1.
2.
3.
EXIT your position when you have The Trade Exit.

BEWARE KEEP AWAY when the price-action is sideways, Trinity lines stay
in DOUBT or on opposite sides of Zero or TRUST is FLAT or outside
GRACE.
WAIT for LOVE and MERCY to Leave DOUBT as the horizontal gap of the
LOVE and MERCY Zero cross are close together.
GTO allows us to know the two types of Market Dance Behavior:

1.
2.
Sustained Trends (Foxtrot) Begins when LOVE and MERCY cross Zero
together, then TRUST joins LOVE on the same side of Zero.
Sideways and Pivoting (Jitterbug) is also a sign of continuation of a
current trend. LOVE and TRUST are on OPPOSITE sides of ZERO, as LOVE or
TRUST is FLAT.
The GTO Mindset:

1.
2.
3.
"DANCE" with the market; DO NOT PREDICT where it is going.

HOPE will not move the price-action, LOVE crossing Zero moves the
price-action !
Market direction is always known through the Trinity lines. We DO NOT pay
attention to the NEWS! We DANCE with the market.
GTO Benefits...
1.
2.
3.
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FREEDOM of sight and awareness.

ENERGY to trade for a long time (if we want to) - due to Less Frustrations.
FREE for everyone to use (except for the monthly cost of a Sierra Chart
subscription - $27 per month).

Nov. 23, 2016
Conquer the Fear:

1. Fear of Missing an Entry - when entering a position, GTO does Market Buy and
Sell.
2. Fear of the Retrace taking you out - because LOVE Zero-cross or MERCY going
outside DOUBT are the MUST EXITs.
3. Fear of the Sideways - going in and out of positions - with GTO we know to STAY
AWAY when LOVE and MERCY are in DOUBT or are on OPPOSITE sides of Zero.
4. Fear of Not Knowing where the market is - because with GTO we know where the
market is in its cycle and where the market will go. The LOVE and TRUST lines tell
us direction.
5. Fear of Losing because with GTO and the Bollinger_Band, we know when to
take a position on the correct side, how long to hold and when to exit.
Known Facts about GTO:

1. All Trinity lines cycle through Zero. When a line goes above the Zero, it will go
below the Zero and vice-versa.
2. When LOVE and MERCY are ABOVE Zero, market tends to dance UP.
3. When LOVE and MERCY are BELOW Zero, market tends to dance DOWN.
4. Price-action will not move quickly until LOVE and MERCY goes BEYOND (outside)
DOUBT.
5. When TRUST is sideways ABOVE the UPPER GRACE, the market will continue to
dance UP.
6. When TRUST is sideways BELOW the LOWER GRACE, the market will continue to
dance DOWN.
7. When The LOVE and MERCY lines are in DOUBT, the market continues its current
trend.
8. A LOVE Zero Bounce is strong. Any Trinity line bouncing off the Zero completes
their cycle.
9. LOVE and MERCY together during Zero crossing is strong, but may be short-lived
(Jitterbug).
10.
When LOVE, does not match price-action direction, you have DIVERGENCE.
11.
Any Trinity line crossing Zero or each other has significance.
12.
Any LEAP of the Trinity lines will cause price-action to go sideways.
13.
Price-action will move when LOVE and MERCY are helping each other
on the same side of Zero.
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The GRACE Trading Operation Layout

TRUST, LOVE and MERCY are know as the TRINITY lines.
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GTO Grace Trading Operation...

Pre-Plan:
Requirements:
1. Understand the RISK of Online Day-Trading (Risks, Day-Trading)
2. Be Familiar with the SierraChart Trading Platform (SierraChart Instruction)
3. Calibrate LOVE, MERCY, TRUST, GRACE and DOUBT to the financial instrument
traded
(Calibrating the Narrows)
4. Understand DOUBT and the concept of Cycles
5. Use the CL (Light Sweet Crude) and GC (Gold) for your financial instrument, with
the MAIN chart (VLOT Very Low-Order-Timeframe) at 1597 ticks, LOT (Low-OrderTimeframe) chart at 2584 ticks.
Pre-requisites:
1.
2.
3.
4.
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Serene, Healthy and Alert

Computer, Internet and Trading Platform are well
Goals, Limits and Mantras reviewed (Goals, Limits, Mantras)
In isolation - no distractions

Nov. 23, 2016
Production Routine: Make this a habit (practice diligently for 30+ days).
1. Opening Prayer
2. Find and draw horizontal (GRACE) lines, marking Support and Resistance
Levels using the FLATs
of the upper and lower Bollinger_Band (see section: The Bollinger Band is
needed)
3. Review the Trade Setup:
a. STAY AWAY from a FLAT TRUST or when LOVE or MERCY are in DOUBT or
opposite sides of Zero
b. ENTER when TRUST is in GRACE and BOTH LOVE & MERCY are TOGETHER
and LOVE goes BEYOND DOUBT
4. Review the Trade Exit:
a. EXIT when LOVE does a Zero-cross against you or MERCY goes out the
opposite DOUBT
5. Summarize and note Production Performance
a. PL and Total number of fills
b. What went wrong
c. What was learned
6. Closing Prayer
Grace Trading Operations (GTO) Ver: 7.1

1. ENTER when TRUST is in GRACE and BOTH LOVE & MERCY are TOGETHER
and LOVE goes BEYOND DOUBT
2. EXIT...
2.1 When LOVE and TRUST are on the same side of Zero, EXIT when LOVE cross TRUST
2.2 ALWAYS EXIT, when LOVE or MERCY Zero-cross against you, as MERCY goes
BEYOND DOUBT
MUST ALWAYS EXIT...
1. when MERCY Zero-cross against you and goes beyond DOUBT.
2. when LOVE Zero-cross against you.
When MERCY is on the OPPOSITE side of Zero from LOVE, the market WILL be
SIDEWAYS, because MERCY is NOT helping LOVE.
Post-Plan:
Update your Trade Journal blog site
1. Record goals reached
2. Record limits and mantras broken
3. Record quality of OBEDIENCE to the Trading Plan
4. Record things learned
5. Record profit or loss and number of fills
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Nov. 23, 2016
Do re-cap; Video and/or Screenshot the charts and add to your blog site.
GTO Official Goals, Limits and Mantras...

GOALS:
You are an EMPLOYEE of the Market and MUST BE OBEDIENT to the "The
GRACE Trading Operations"
You trade only one contract at a time and end your trading day once you
have MET your daily profit goal.
You ALWAYS WAIT for The Trade Setup
You ALWAYS execute The Trade Exit
LIMITS:
Use ONLY 1 contract
MEET a DAILY PROFIT GOAL, then STOP trading
Maximum daily fills: 8
Maximum daily LOSS: $200
PROFIT Limit per trade: $100
Trailing STOP: 15 ticks
RISK MANAGEMENT: - Best to Skype and trade with a Trading Buddy.
Your Trading Buddy will manage your risk and you will manage theirs.
When you have no Trading Buddy, STOP after two losses in a row or you have
reached your daily loss limit or you have reached your profit limit.
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MANTRAS:
1) The market pays you to BE OBEDIENT to The GRACE Trading Operations.
2) Do not claim to be obedient, if that is not the case 100%.
3) Halve the number of contracts you trade when trading poorly.
4) Never turn a winner into a loser.
5) Your biggest loser cannot exceed your biggest winner.
6) Stick with the plan, do not change it.
7) Be yourself, do not try to be someone else. (I am personally a SPRINT Trader, not a
MARATHON Trader)
8) You always want to be able to come back the next day.
9) Earn the right to trade more contracts at one time.
10) Get out of your losers.
11) The first loss is the best loss.
12) Do not hope and pray. When you do, you will lose.
13) Do not worry about news its history. We DANCE with the market.
14) Do not speculate/predict. When you do, you will lose.
15) Love to lose money.
16) If your trade is not going anywhere in a given timeframe, exit.
17) Never take a big loss. Only a big loss can hurt you.
18) Make a little bit each day. Dig your ditches. Do not fill them.
19) Hit singles not home runs. Set a Daily Profit Limit you can easily meet.
20) Consistency builds confidence and control.
21) Learn to sweat out (Scale out) your winners (when using multiple contracts).
22) Make the same type of trades, repeatedly. Be a bricklayer.
23) Do not over analyze. Do not procrastinate. Do not hesitate. When you do, you will
lose. Be Alert! Train to Trade instinctively!
24) All traders are created equal in the eyes of the market.
25) It is the market itself that wields the ultimate scale of justice.
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Nov. 23, 2016
The Quick Learning Training program:

1. Do your Historical Chart studies.
a. Look for The Trade Setups, where LOVE and MERCY starts at or from
outside DOUBT
b. Look for The Trade Exits, where MERCY Zero-cross against you, exiting the
opposite DOUBT or LOVE cross TRUST or Zero-cross against you.
2. Do Live-Demo (real-time datafeed in simulation mode) of the Market, if you have
no brokerage account, then use market replay. Please realize market replay IS NOT
the same a LIVE data.
3. Be ALWAYS OBEDIENT to the GRACE Trading Operations.
4. Let the Universe teach you the details, as you do your 30 Days countdown to LIVE.
Begin your 30 Day Countdown to Live:

(Split the 30 days into Three Combines, where a Combine is 10 trading days each, with differing goals and
limits you wish to attain. For example, the Third Combine may use 2 contracts at a time per trade.)
1.
2.
3.
4.
5.
Be ALWAYS OBEDIENT to the GRACE Trading Operations

Use only 1 contract for the first and second combines. (The first 20 Trading days.)
Maintain a trade journal and video recap your daily countdown.
Why video? Because you need to record your thinking on why you did that action.
After taking a Break, do your Historical Studies of recognizing when the best Trade
Setups happen and when was the best Trade Exit.
6. Do Market Replay. Keep replaying the scene until you maximize your profit.
Share your insights with other GTO practitioners. In freely sharing our discoveries, we have made
such wonderful progress!
OBEDIENCE to the GRACE Trading Operations is paramount
and staying within your Loss and Fill Trade Limits!
1. Trade TICKS NOT MONEY!
2. TRAIN, TRAIN, TRAIN You have to act on The Trade Setups and Exits
Instinctually!
3. PROVE everything to yourself!
4. Trade WITHOUT emotion!
You are READY to go LIVE

1. You are 100% OBEDIENT to the GRACE Trading Operations.
2. You MOSTLY (90%) go in on the correct side of the trade
(the Market does not go against your position).
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Quick PRIMER on the Trinity lines and what they are:

1. The Zero Line (Zero-orange) - is foundational to GTO. Without the "Zero", we
will not know the various cycles the market goes through. GTO essentially
places a Zero line on the price-action - this is the source of power for GTO.
2. MERCY (thin solid yellow-orange) is the fastest speed GTO line, predicts
where LOVE will go next, tells us the markets short term cycle. MERCY Zerocross is an EXIT warning.
3. LOVE (thick dashed yellow-orange) is the medium speed GTO line, tells us the
market's medium term cycle. When LOVE crosses the Zero line, it will
move the price. LOVE going beyond DOUBT is an ENTRY signal, provided
TRUST is NOT flat and is in GRACE.
4. TRUST (thin dotted white-grey) this is the slowest speed GTO line, tells us the
market's long term cycle. TRUST is essentially the price-action with a Zero line.
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Nov. 23, 2016
The Bollinger Band is needed:

WHY?
1. As a guide for setting traps
a. BUY traps are set outside and above the upper Bollinger Band.
b. SELL traps are set outside and below the lower Bollinger Band.
2. As a guide for Support and Resistance levels (we call GRACE lines)
a. Draw horizontal lines (Resistance) from FLATs of the upper Bollinger Band
b. Draw horizontal lines (Support) from FLATs of the lower Bollinger Band
Here is a drawing for illustration
.
Bollinger Band is a tool invented by John Bollinger in the 1980s, The Bollinger Band is used to measure
the "highness" or "lowness" of the price relative to previous trades.
Bollinger Bands consist of:
an N-period moving average (MA)
an upper band at K times an N-period standard deviation above the moving average (MA + K)
a lower band at K times an N-period standard deviation below the moving average (MA K)
Typical values for N and K are 20 and 2, respectively.
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What is DOUBT and GRACE...

Early in our development of GTO, the UNIVERSE taught us the importance of LOVE and the
significance of GRACE and DOUBT. The use of GRACE is very important in allowing us to know
the cycles of the market dance. GRACE allowed us to have an area around the Zero line, called
DOUBT, where the most exciting part of the market dance happens.
With GRACE, we know
1. Continuation as the price-action and Trinity lines go sideways or we are in Jitterbug (a
pivoting market). The LOVE stays in DOUBT.
2. Reliable Trade Setups and Trade Exits as LOVE and MERCY cross the Zero, together.
3. Sustained trends, as TRUST is outside GRACE or just FLAT.
GRACE and DOUBT define areas above and below the very important Zero line.
We MUST "calibrate" GRACE and DOUBT to a specific financial product or instrument.
Calibrating GRACE and DOUBT to a financial instrument:

1. Find a True Trend Change for UP.
2. Find a True Trend Change for DOWN.
3. Set the Upper GRACE (Upper is above the Zero line) about where TRUST starts a
Downtrend.
4. Set the Lower GRACE (Lower is below the Zero line) about where the TRUST starts an
Uptrend.
5. Since we want the GRACE and DOUBT symmetric around the Zero line the values for
the Upper and Lower GRACE are the same.
We then set the value for DOUBT
Find a trend start where the price-action bounces off the edge of a Bollinger-Band.
As, price-action crosses the Mid-Band of the Bollinger, DOUBT is set as LOVE leaves
DOUBT.
Please see the calibration video on youtube or email childrenofthejourney@gmail.com
for help:
https://www.youtube.com/watch?
v=NcANVj6BQY8&index=10&list=PL8Ugz426o2EJoEBop9yFTGEB0kRtfqRQL
and
https://www.youtube.com/watch?
v=nUW3JA0MuDc&list=PL8Ugz426o2EJoEBop9yFTGEB0kRtfqRQL&index=1
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The Phase Cycle concept:

As any of the Trinity lines (LOVE, MERCY and TRUST) cycle up and down through the Zero line,
they create two phases.
The Phases of a Cycle
The EXPANSION phase LOVE moves AWAY from Zero BEST time to ENTER a position.
MERCY is on SAME SIDE of ZERO with LOVE.
The CONTRACTION phase - LOVE moves TOWARDS Zero BEST time to EXIT a position.
MERCY is on OPPOSITE SIDE of ZERO separated from LOVE.
When LOVE or TRUST do NOT follow price-action we have what is called DIVERGENCE.
Use the Phase Cycle to your advantage

ONLY make a LONG trade when LOVE & MERCY are TOGETHER ABOVE and moving AWAY from Zero.
ONLY make a SHORT trade when LOVE & MERCY are TOGETHER BELOW and moving AWAY from
Zero.
STAY AWAY when LOVE or TRUST is FLAT or LOVE & MERCY are separated by Zero. This will SAVE
YOU from an unprofitable sideways market and a re-trace against you.
NOTE: It is BEST to WAIT for LOVE & MERCY to be together and for LOVE to go
BEYOND DOUBT before making an ENTRY.
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Nov. 23, 2016
End of Teachings...
Conclusion:
There is no Holy Grail of technical indicators.
The best a GTO practitioner can do is to "Dance" with the market.
The GTO Tools are a MIRACLE!

We thank the UNIVERSE for giving us the WISDOM to use GTO safely and
profitably.
When we are NOT Profitable...
it is because of our LACK of Trust in the tools and our LACK of OBEDIENCE to the GRACE Trading
Operations.
Blessings Always
Arnulfo Pealoza and Bruce MacWilliams of the GTO Development
Team
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