Downward Trendlines...

Trade options along a trend line

The 1 guide to trading with trendlines with examples This is how NOT to draw trend lines correctly Before looking at how to draw a trendline for trading stocks, we must first consider how not to draw trend lines. Mistake 1 Firstly, any two point of reference can be connected to create a trendline. While it is true that technically you do have a trendline bit simply Connecting any two points does not mean that you have a tradable trendline. Mistake 2 The second mistake that most traders make when trying to draw trendlines correctly is to use candlestick charts or bar charts when drawing them because you would often being using the extreme high or the extreme low for the day. Using the close price gives you a much better reference point and switching over to the line on close chart type will allow you to see reference points to use of drawing trendlines that you simply would never have otherwise considered.

Now before I dive into specific Trend Line strategies and techniques, you must first learn how to draw a Trend Line correctly. And which to ignore?

HOW TO PROPERLY DRAW A TREND LINE IN YOUR TRADING **FOREX-STOCKS-CRYPTOCURRENCY**

An example: Because a Trend Line can also alert you when market conditions are changing. By paying attention to the steepness of the Trend Line.

trade options along a trend line

For example: If your Trend Line is getting flatter, it means the market is moving into a range condition. And if your Trend Line is getting steeper, it means the trend is becoming stronger or possibly going into a buying climax.

trade options along a trend line

Is this important? Heck yes! Because if you know market conditions are changing, you can adjust your trading strategy accordingly.

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Next… Trend Line Trading: How to better time your entries If you want to find good trading opportunities, then you must trade near the Trend Line. But if the pullback is shallow and you enter your trades too late, you risk missing the move. Introducing The Trend Line Breakout technique.

trade options along a trend line

Does it make sense? And in such cases, you want to trail your stop loss on the current market swing and exit the trade if the price closes below it. So the question is… How do you identify a trend reversal to the upside?

trade options along a trend line

If it does, the market is likely to reverse in the opposite direction. Now over to you… How do you use Trend Line in your trading?

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