One of the most popular tools used to determine trend is the Trendline. Even though the concept is quite simple, there are multiple types and ways to use them to good effect. There are many platforms that exist where trendlines can be drawn and monitored, and for an alert to be highlighted when the line has been breached. Many broker platforms will have this embedded within, so lines are easy to monitor when on the go.
- Drawing and Recognising Breaks
In their most simplistic form, these lines are very easy to draw, and can be effectively used to identify trend, or simply compliment or validate other strategies. All that is required are at least 2 visible reference points from which a line can be joined. We also need to consider the question of what constitutes a break of the line, and whether it should be re-drawn. Below are some simple examples…….
