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Technical Analysis: Understanding Trend Lines within Stocks

December 7th, 2012

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

Author: Sasha Evdakov

Sasha is the creator of the Tradersfly and Rise2Learn. He focuses on high-level education speaking at events, writing books, and publishing video courses on business development, internet marketing, finance, and personal growth.

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