How To Use Trend Lines
What You’ll Learn
- Types of trend lines: angular trend lines and horizontal trend lines
- Purpose of trend lines: to identify potential levels of support and resistance
- Drawing trend lines using extremities (highest or lowest points) of a level
- Need at least two points to connect for a valid trend line
- More points touching the trend line indicates a stronger trend line
- Extending trend lines to identify potential trade entries and exits
- Selling opportunities: price failing to break above resistance trend line and retesting it
- Buying opportunities: price retesting support trend line
- Using trend lines in combination with other techniques for better trading edges
- Focusing more on horizontal levels than angular levels for personal trading style
- Trend lines can be useful for identifying trends (e.g., uptrends within a bigger picture downtrend)
- Arbitrary trend lines from years prior can still affect price action years later
- Trend lines can help with entries, exits, stop losses, and invalidations in trading
Content Chapters
0:04 – Introduction and overview of trend lines
0:26 – Using trend lines to identify potential support and resistance levels
0:49 – Drawing trend lines using extremities (highest or lowest points) of a level
1:24 – Extending trend lines to identify potential trade entries and exits
2:37 – Example of using a support trend line for buying opportunities
3:22 – Example of using a resistance trend line for selling and buying opportunities
4:01 – Drawing multiple trend lines to identify potential trades
5:22 – Trend lines as a tool to be used in combination with other techniques
5:43 – Focusing on key trend lines and not overcomplicating with too many lines
6:21 – Using trend lines to identify trends within a bigger picture trend
7:11 – Trend lines from years prior can still affect price action years later
7:48 – Using trend lines for entries, exits, stop losses, and invalidations
8:03 – Conclusion and teaser for the next video on support and resistance levels
