How to draw a Trend Line?
Trend Line Tips
#1. Not everyone sees the same Trend Line as you doA. Every trader has approach to analysing the market & where to place a trend line
B. Every Forex broker will have own slightly different price movement ranges (based on price quotes received from different liquidity provders).
This means that traders will have different price reference points for their trendlines.
Add these A+B points together, and you'll see that your trend line is NOT the "one and only line to obey".
Keep that in perspective for tip #2.
#2 What is a broken trend line for one trader, may not be a signal for another- Forex traders have different rules and risk tolerance for every price move.
When it comes to Trend lines, once a price approaches to "test the line", it might pierce it for a while before committing to either: breakout or trend continuation.
During this short period of "trend uncertainty", some traders would pull an early trigger, while others won't be concerned.
Keep this in mind when making own decisions. Be flexible in mind, yet stay on target with your strategy.
#3 Trend lines drawing techniques vary from trader to traderDo you connect Highest Highs when drawing a Trend line?
Or Do you connect candlestick Bodies, and ignore the shadows?
Each method has it's purpose, but the important thing to remember again is that traders will end up with different trend lines as a result.
CONCLUSION:Treat your trend line as a guidance, but not as a "set in stone" & the only possible trend line outthere.
Remember, that traders see charts & draw trend lines differently, thus will act upon price changes and trading signals differently as well.
To your trading success!
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