Trend lines are a way for you to predict price because technical analysis is based on future predictions.
Trend Lines
- Trend lines have to hit the price points two or more times
- You can have a positive or negative trend
- They help you look at the future
- They can change angles at higher or lower slopes depending on how strong the trend is
- Trend lines can be validated with a third or fourth point
- Pay attention to trend line spacing or the distance between each point
- Tighter points have more validity toward the trend line
- Pay attention to angles: the steeper the angle of the trend line, the less validity its support and resistance has (because the price points are being climbed rapidly)
- Both upward and downward sloping trend lines can help you to predict future prices within technical analysis