GIMP Version: 2.8.14
Operating System: Mac OS
OS Version: Sierra 10.12.1
GIMP Experience: New User

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I am trying to draw a simple straight line onto a multi layered image, but while I can draw line using pencil tool on a new image it just won't show up when I tried on a transparent image - I don't know what is missing. The line outline comes up but then when I click on the mousepad again nothing happens.

Hi and welcome to Gimp Chat.
First thing you should do is check the brush size AND opacity in the tool options dialog. Make sure its a size you can see and its VISIBLE.
To do this select the brush tool in the tool box and then the dialog for brush settings should pop up. IF your tool options doesn't show, DOUBLE click the brush tool in the toolbox. This will make the tool options dialog appear. OR go to Windows>Dockable dialogs and select brush's from the list.

IF setting the size AND opacity of the brush doesn't fix your problem do this test. Make sure your fg color is set to BLACK (000000)
1) create a new document with a white background
2) create a new TRANSPARENT layer
3) select the new transparent layer
4) select a default round (circular) hard brush and in the tool options dialog make it 25 pixels in size AND 100 percent opacity AND layer mode NORMAL.
5) paint on the transparent layer by clicking anywhere on the layer and then holding down the shift key click in a new spot. You should have created a STRAIGHT line from the first selected point to the next and the size should be 25 pixels.

Thank you.

Finally managed to fix that, it was some selection that was causing the problem. All fixed when I did Select > None.

Welcome to Gimp Chat, coe123. Happy you have the problem solved.

Hahaha having an item selected and trying to do something else is my most common mistake....usually happens when I've spent 5 minutes lining up a crucial brushstroke...
Welcome to the forums, and best of luck!

I wonder if anyone has submitted this as a bug report. Perhaps a warning dialog when a selection is present when trying to use other tools. Sometimes the selection is so small that the user does not see it.

One way is use the histogram. Put it in alpha mode if there is an alpha channel otherwise value is default.