Forex Trend Lines

Posted by: | Posted on 11:15:00 PM | Post Categories

One of the most common and popular tools in technical analysis is the trend line. The trend line is easily understood. If the trend line is drawn correctly, it gives better results than any other method. But most traders are not able to draw the trend line correctly and forcing the trend line to be drawn does not make it effective.

To draw a trend line, you have to draw a line with the trend line tool from Meta Trader's tools.

The low points have to be connected through a trend line and the high points have to be connected through a trend line.

If a candle crosses the trend line and goes up or down, then the trend line is broken.

Follow the chart below:


There are 3 types of trends

    Up Trend (higher lows)
    Down Trend (lower high)
    Sideway/No Trend (ranging)

In uptrend, the market is upward. So you can buy. In downtrend, the market is down. So you can sell. In a sideway trend, the market tends to move in a certain range. So it is better not to trade in sideway trend.

   

 


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