Trend and trend line
Following Unfollow Trend Lines Trend lines can be used to identify and confirm trends.
A trend line connects at least 2 price points on a chart and is usually extended forward to identify sloped areas of support and resistance. Lines with a positive slope that support price action show that net-demand is trend and trend line.
As long as the price action stays above this line, we have a bullish trend. Lines with a negative slope that act as resistance to the price action show that net-supply is increasing.
As long as the price action stays under this line, we have a bearish trend. Price usually retests a sloped trend line several times, until it breaks at which point we may have a trend reversal.
The more points there are to connect, the stronger a trend line becomes. Different strategies have different rules on how trust trade option apart connected price points can be and whether to connect wicks or candle bodies, but all trend lines break eventually.
TradingView has a smart drawing tool that allows users to visually identify trend lines on a chart.
This tool can also be used to illustrate trends on indicators. This script computes the most suitable active upper and lower trendlines and updates them as soon as possible. We can use it for breakout signals earlier than Donchian Channels.
Introduction Channels are tools which can mark area of values of ranging