DOWNLOAD TRENDLINE ANALYSIS FOR BEGINNERS BY EASYTRADEFOREX
Great breakthroughs have surfaced with electronic trading and certain technical indicators are widely used. Nevertheless an affluent trader should be very skilled with trendline analysis in order to correctly predict Forex price movements. “Trend is my friend” is commonly said among traders. In this chapter you will learn how to correctly apply trendline analysis, one of the most important tools in your trading analysis.
The most used technical analysis strategy is Trendline Analysis which are lines drawn joining points of interest for example support and resistance and in this regard having a prediction of where the market is going next. as shown below
source :Trading View
The image above has point A B C D marked and little circles on them.
Point to Note : A trend line only becomes valid if it has 2 or more points touching it
Now looking to the image above the Trendline was first touched at A and moved on to B which did not really touch but was in the range of touching the line so for this example I will just put it but dont do it. Just by drawing that trend line and seeing those points you could have taken a risk free trade at C will very little draw down of about 1pip and a 10pip stoploss (Including Spreads) and get around 120pip take profit to be hit in a day (this chart was taken on an H4 timeframe)
Personally I wouldnt encourage you to take the fourth hit as this might be dangerous as the market might reverse before hitting your take profit as in that image because on D it looks like it went up (and it did ) for some time and it quickly went down. You will have to find that which suits you and follow it.
this was only a highlight of what trendlines are and the power they hold in technical analysis the rest and indepth look at it is in the pdf below
As with every strategy that we post here, please please and please do practice this in a demo account and be consistent in the demo using the strategy, dont just go on the rampage saying I now know this strategy without making the actual money from trading. Make sure you practice the strategy before trading your real money.
Follow this and more on our blog and other sources of information. Wishing you great success in your trading journey.
Peace out :)
Disclaimer: THIS Post AND OTHER MATERIALS FROM THIS/IN THE NAME OF THIS SITE(fxstrategylife.blogspot.com) IS FOR EDUCATIONAL PURPOSE ONLY. FOREX TRADING CARRIES A HIGH LEVEL OF RISK, AND MAY NOT BE SUITABLE FOR ALL INVESTORS. PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE RESULTS. THE HIGH DEGREE OF LEVERAGE CAN WORK AGAINST YOU AS WELL AS FOR YOU. BEFORE DECIDING TO INVEST IN FOREIGN EXCHANGE YOU SHOULD CAREFULLY CONSIDER YOUR INVESTMENTS ,OBJECTIVES LEVEL OF EXPERIENCE AND RISK APPETITE. THE POSSIBILITY EXISTS THAT YOU COULD SUSTAIN A LOSS OF SOME OR ALL OF YOUR MONEY AND THEREFORE YOU SHOULD NOT INVEST MONEY THAT YOU CANNOT AFFORD TO LOOSE.
