Rattibha

Technicality of Trend Lines
tricks they never told you 🧵🧵🧵

1/ Trend lines are graphical tools used in trading to visually represent the direction of price movement for a specific asset, such as stocks, currencies, or commodities, over a certain period of time.

2/ They are drawn on a price chart and are used to identify the prevailing trend and potential areas of support and resistance.

3/ An uptrend is characterised by a series of higher highs and higher lows, while a downtrend features lower highs and lower lows.

4/ many forex traders have their own way of using Trend lines, on trading view you have different option for chart type, and that’s what we would implement in drawing the Trend lines.

5/ in the example below, two separate ways you can draw the trend line.

6/ Using trendline is very easy, theory behind trendline is that most forex or crypto traders who use this tool tend to enter the trade for either buys or sells after the third touch, lol which to me completes the form of what we know as trend line liquidity as seen below.

7/ what is the right way of drawing the trendline, for me I prefer to use the wicks, but most persons would use body, now I am not saying its wrong yh, but wicks shows rejections of prices at a certain points. When trading this concept it’s best to use the break out strategy.

8/ Instead of buying or selling on the third top of the trendline which is a big trap called liquidity, it’s best to trade the breakout. For a buy breakout, your stop loss is below the last low, then you target the point where your trend line was drawn from.

9/ Same concept for Sell narrative, I want you to try this concept if you don’t like complexities, or smart concept, this is the simplest it can get, if you do use it, its also best to integrate the fib strategy,

10/ Implementing the fib strategy alongside the trendline, yields a better risk to reward #lessismore