What's a Indices Trend?
A indices trend is the tendency of stock indices prices to move in one specific direction for certain period of time.
Indices Trading prices generally move in trends, the indices trend direction can either be upwards or downwards.
Indices Traders use indices trading tools such as indices trend lines to identify indices trends.
Indices Trend lines help to define entry and exit points for trades that are open by stock indices traders.
The trend line define the stock indices trading market indices trend & as long as prices continue to move within the trend line the traders will keep their trade open. Traders will only close their open indices trade once the indices prices stop moving within trend lines.
The two types of indices trends are:
Upward Indices Trend - Drawn using an upward indices trend line
Downward Indices Trend - Drawn using a downwards indices trend-line
Upward Stock Indices Trend
Course: How to Draw & Trade Upwards Indices Trend
Drawn using an upward indices trendline
Downwards Indices Trend
Course: How to Draw & Trade Downwards Indices Trend
Drawn using a downwards indices trendline
The MT4 platform provides charting tools for plotting trends on stock indices charts. To draw indices trend on indices charts traders can use trendline plotting tool provided on MT4 software that is illustrated and shown below.
Definition and Meaning of a Indices Trend & How to Trade a Indices Trend
To draw a indices trend line in MetaTrader 4 platform & select point A where you want to start drawing and then point B where you want the it to touch. You can also right click in trend-line and on properties option select option to extend its ray by checking 'ray check box', if you do not want to extend it, then uncheck this option in your indices trading platform.
The indices trend is your friend. Is a popular saying among indices traders because you should never trade against it. This is the most reliable indices trading method to trade Indices Trading because once stock indices prices begin to move in one direction they can continue moving in that particular direction for quite some time in what is known as a trend.
Principles of How to Draw & Define Stock Indices Trend
Use candle charts
- The points used to draw the indices trend are along the lows of the stock indices price bars in a rising market. An upwards bullish indices trend move is defined by higher highs & higher lows.
- The points used to plot are along the highs of the stock indices price bars in a downwards falling market. A downwards bearish indices trend move is defined by lower highs & lower lows.
- The points used to draw the trend lines are extremes points - the high or the low indices price. These stock indices price extremes are important because a close beyond the extreme tells indices traders that the indices trend of the indices instrument might be changing. This is an entry or an exit indices signal.
- The more often a indices trend is touched by stock indices price but it's not broken, then the more powerful the indices trend signal.
