How to Draw a Indices Trend-Line on a Chart
How to Draw a Indices Trendline on a Chart - How to Draw Indices Trend Lines on Stock Indices Charts
Principles of How to Draw a Indices Trend Line on a Chart
Use candlestick stock indices charts to draw indices trend lines
- The points used to draw a indices trendline on a stock indices chart are along the lows of the stock indices price bars in a bullish stock indices market. An upwards bullish indices trend is defined by higher highs & higher lows.
- The points used to draw a indices trendline on a stock indices chart are along the highs of the stock indices price bars in a bearish stock indices market. A downwards bearish indices trend is defined by lower highs & lower lows.
- The points used to draw indices trend lines on the stock indices charts are the extremes points - the high or the low indices trading price. These extremes are important because a close beyond the extreme chart points tells indices traders the indices trend of the indices trading instrument might be changing. This is an entry or an exit indices trade signal.
- The more often a indices trendline on a stock indices chart is hit but it's not broken, the more powerful its indices trend signal.
Example 1: How to Draw a Upward Indices Trend Line on a Chart
To draw an upwards indices trendline on a stock indices chart use 2 support points in a bullish upwards indices trend so that to draw the upward trend line & then extend the trend-line as illustrated and shown below. The upwards indices trendline on a stock indices chart will show the general direction of stock indices trading prices & as long as stock indices trading price is above this upwards trend-line then the upward trend will remain intact - bullish upward indices trend.
If indices trading prices move below the upwards trend line which is the support level for the bullish upward indices trend then stock indices traders should close all their open stock indices trades - because this might be a indices trend reversal signal. In an upwards indices trend stock indices trading price should generally stay above support level which is marked by the upwards trend line on the stock indices charts.
Draw a Up Indices Trend-Line on a Chart in Indices Trading
How to Draw an Upward Indices Trend Line on a Chart - How to Draw a Indices Trendline on a Chart
Example 2: How to Draw a Downward Indices Trend Line on a Chart
To draw a downwards indices trendline on a stock indices chart use 2 resistance points in a bearish downwards indices trend so as to plot the downwards indices trend line & then extend the trend line as illustrated below. The downwards indices trendline on a stock indices chart will show the general direction of stock indices trading prices & as long as stock indices trading price is below this downwards trend line then the downward indices trend will remain intact - bearish downward indices trend.
If indices trading prices move above the downwards indices trend line which is the resistance level for the bearish downward indices trend then traders should close all their open stock indices trades - because this might be a indices trend reversal signal. In an downward indices trend stock indices trading price should generally stay below the resistance area which is marked by the downwards trendline on a stock indices chart.
Draw a Indices Trading Down Trend-Line on a Chart in Indices Trading
How to Draw a Downward Indices Trend Line on a Chart - How to Draw a Indices Trendline on a Chart
