Why Do We Use Indices Trend Lines in Indices Trading?
Indices traders use indices trend lines in stock indices technical analysis because stock indices trading prices move in indices trends and the best indices trading tool to interpret these indices trend are the trend lines that are to indicate the direction of the trend either upwards or downwards.
Indices trend lines are also commonly used by traders because they are the most simple form of technical analysis that is used by many stock indices traders to determine where to open buy or sell stock indices trades.
Indices Trend lines work by indicating the support levels of stock indices trading prices or the resistance levels of stock indices prices.
Indices trading prices move in a series of support & resistance levels & these series of support & resistance pattern then forms a general market direction either upward or downward.
Traders use indices trend lines to depict these patterns on the stock indices trading price charts as shown on the stock indices example explained below:
Minor Resistance/Support levels
In minor resistance & support points the stock indices trading price will quickly form these points in the short term and quickly move past these resistance and support points during a indices trend.
Upwards Stock Indices Trend: The upward indices trend pattern of this minor resistance and support points will form a sequence of levels whose general direction is upwards.
Why Do We Use Indices Trend Lines? - How Do Indices Trend Lines Work?
Downwards Indices Trend: The indices trend pattern of this minor resistance & support points will form a sequence of levels whose general direction is downward.
Downwards Indices Trend Series of Support and Resistance - Why Do We Use Indices Trend Lines? - How Do Indices Trend Lines Work?
Traders then analyze these trend line using indices trend line technical analysis to determine when & where to open a buy or a sell indices trade depending on the direction of the trend line.
