JoymistaWhat Is a Trend Line and How Do You Draw It?
A trend line joins two rising lows in an uptrend, or two falling highs in a downtrend, to show the slope of the move.
Explained
Two points draw the line, and a third touch that holds makes it more convincing. Breaking a trend line does not on its own mean the trend reversed; it signals a change in momentum that needs confirming from market structure.
Example
Example with made-up numbersA low at 100 then a higher low at 104 give an uptrend line. If price dips to the line near 108 and bounces, that is the third touch.
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Related terms
- Support and ResistanceSupport is a price zone where falls stopped before because buyers took over; resistance…
- Market Structure: BOS and CHoCHMarket structure is the order of highs and lows: higher highs and lows in an uptrend,…
- BreakoutA breakout is price closing clearly outside a support or resistance zone; a false…
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Open in JoymistaEducational content, not investment advice.