Written by Robert McKinley

Forex Trend Lines

We covered trend lines briefly in the previous lesson, “Forex Trends” and will add just a bit more information here.

Trend lines can be as accurate as any other tool you can use; that is if you draw them correctly. The problem is that for various reasons, many traders do not draw them correctly.

Below, is the same chart you saw in the previous lesson. (You did read the last lesson, right?) Take a look at it again to fully understand how the trend lines have been drawn and why.

1. In an uptrend, notice that the line is drawn along the bottom of the lowest price points (the bottom of the valleys), which are also areas of support.
2. In a downtrend, notice that the line is drawn along the top of the highest price points (the top of the peaks), which are also areas of resistance.

The next lesson is Forex Channels.