HOW TO MAKE USE OF TRENDLINES

A “Trendline” as the name connotes speaks for itself. It helps a trader to identity possible pullbacks on both resistance and support levels, for the purpose of making sound trading decisions. Trendlines are not indicators but simple lines you draw up on your chart to help with your trade analysis. When you draw up a trendline, you simply are telling yourself that you are aware of where the trend is coming from and that you are also willing to follow it where ever it chooses to go next. That is my philosophy to trendlines. There is this popular maxim in the world of forex which states that, “The trend is your friend”.

Trendlines when drawn properly can assist a trader in becoming more successful than not on each trade that is taken. It does not matter what time frame you are working with, whether a trader is on a short or long term trade, trendlines will prove to be quite effective as long as one knows the rudiments or basics of the resistance and support principles.

Consider the market movements, as the candle sticks goes up and down in waves on every time frame, appearing to have no meaning to the common man; but to a professional forex trader, a lot of meaning could be made to that same chart. These waves, even though uncoordinated, would always have a particular direction they are heading. It is the duty of a trader, to determine where the support and resistance levels are at –pending on the time frame in use - . Once this is well analysed and the levels mentioned above have been well established, then one could consider taking a position on the direction of the trend; either from top to bottom –from resistance to support- or from bottom to the top –from support to resistance-. These trendlines could be drawn in just two ways. They could be drawn vertically or diagonally.

To have a complete study of trendlines, you would need to have a forex instructor to put you through properly, so you do not end up drawing them up wrongly. We could also advise you to visit this site: www.fxtrendman.blogspot.com /www.trendman3.wordpress.com to drop comments on this topic and ensure to drop your email address, if you desire a full course on trendlines.

Visit: www.fxtrendman.blogspot.com / www.trendman3.wordpress.com for more incisive experience with what you need to know.

Ephraim Archibong is a trader of over four years and counting and is willing to share his knowledge and experience with anyone who is willing to learn.