Trade Bitcoin Trading

Drawing Upward Trendlines and Channels

An upward trend line is a line on the chart drawn when prices overall move up. Draw this line below the rising prices by linking at least two lows in the uptrend. This line shows the price trend heads upward.

The example below shows price action in an uptrend. As the market rises, it builds new support areas. Link these zones to draw the uptrend line.

Because the market usually moves up and down, traders often draw a line that shows the main direction the market is moving upward.

Drawing an Upward Bitcoin Trend Line - How to Spot Bitcoin's Uptrend

Upward Trending Market - Bitcoin Trading

An uptrend is established when Bitcoin's prices consistently generate successive higher peaks (higher high) and successively higher troughs (higher low). Each subsequent peak surpasses the preceding one, and each subsequent low exceeds the one before it.

Upward trend lines gain credibility when Bitcoin's price touches them without breaking through. An uptrend remains valid until the sequence of higher highs and lows is disrupted.

If a price goes below a line that was going up, it means it's time to sell, and it usually means the upward trend might end soon or stop going up and down.

Drawing an upwards Trend Line

In a rising bitcoin market, prices make higher highs and higher lows. Connect those lows to draw an upward trend line.

To establish this setup, we utilize support zones identified by market prices. Correctly drawing an upward trend line requires two support zones. When the price touches or tests this upward trend line, we initiate a buy order and set a stop-loss just a few pips below the trend line. The diagram provided illustrates an example of an upward trend line.

How Do I Draw Upward Bitcoin Trend Line on Bitcoin Chart Explained?

Upwards Trend-Line - Bitcoin Trading

The trend line pattern marks the Bitcoin market as rising. So traders stick to buy orders while price stays in this pattern and near support zones. These zones catch the price on pullbacks and provide firm backing for Bitcoin. That's why buyers hold off until price drops to those levels before starting buy trades.

Trades initiated at these price points offer a very favorable Risk : Reward Ratio, proving to be quite profitable.

In the above set-up, the BTCUSD trader would have initiated buy/long trade transactions from the trading signals generated at the support1, support2, support3 & these trade transactions would have made a lot of profits with a minimum amount of downdraw/retracement. This is the reason why many Bitcoin traders prefer to trade using this trend-line trade configuration.

Drawing Upwards Channel

An upward channel is drawn by plotting a line which is parallel to the upward trendline & then this new line is adjusted to touch top boundary of price movement. This then creates a channel of the price and as long as a remains in between the two channels the bullish movement of Bitcoin prices will continue moving upward.

Upward Bitcoin Trend Lines: Channels on BTC Charts

Upwards Channel - Bitcoin Trading

Trading the Upward Bitcoin Prices Channel

Bitcoin traders utilize this upward channel to identify optimal price points for taking profit. When the price reaches or tests the upper boundary of the channel, Bitcoin traders will secure some profit and then await another pullback before initiating a new buy trade position.

MT5 Tools for Drawing Upward Trendline & Channels

On the MetaTrader 5 platform, drawing tools are located within the line drawing toolbar. If it is not visible, activate it by going to 'View' next to 'File', then selecting 'Toolbars' and enabling the 'Lines Toolbar'.

The screenshot of the MetaTrader 5 trend line drawing toolbar is displayed below. Click this tool and choose the location on the graph where you want to create the trend line.

Upward Trendlines on Bitcoin Charts - Draw Up Channels for BTC Prices

MT5 Toolbar for Drawing Upward Trendline & Channels

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