It took me 10+ years & more than 1000+ hours of practiceā¦
to master these 5 IMPORTANT RULES WHILE DRAWING TRENDLINES šÆ
These simple rules, if mastered, can help one spot HIGH PROBABILITY TRADES!
Ready to learn?š¤
Letās goš§µā¦
1⣠Trendlines are zones and not a single line!
- Due to volatility in price, many times prices tend to spike on both sides
- So, consider trendlines as zones from multiple swing highs(include wicks) to get the best fit trendline
- Your winning probability increases with zones
2⣠Trendlines with more touchpoints
- Any trendline with 3 or more touchpoints is a very significant one
- The price points around significant trendlines are important & should be watched
Observe the commentary in the Nifty chart below
3ā£Trendlines on higher Time Frame are more significant
- A trendline on the 15 min chart will be easily broken than a trendline on the daily
- A shorter time trendline break might just mean a consolidation phase before the price moves up again resuming the larger trend
4⣠The steeper the trendline the more likely it will break
- The less steep the trendline angle, the more significant it is & more likely to be respected.
- Any trendline with an angle greater than 30° is steep & likely to be broken before the previous trend continues.