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 illustration exhibited below explains this concept & explains and describes how the prices move when in an upwards trend. When market is moving upwards it keeps forming new support zones as it moves upward and these support zones are the ones used to draw the upward trendline.

Because the market heads in a zigzag kind of manner, traders will generally draw a trend which shows the overall upward trending direction.

Drawing Upward Bitcoin Trend Line on Bitcoin Charts - Bitcoin Upward Trendline

Upward Trending Market - Bitcoin Trading

An upwards trend occurs when the prices of Bitcoin keep making consecutive higher highs & higher lows. Every high is higher than the prior high - higher high, and each low is higher than the prior low - higher low.

The Upward trendlines gain more validity each time the price of Bitcoin touches the line but does not penetrate it. An uptrend remains in place until this series of higher highs & higher lows is broken.

A down side penetration of an upwards trendline is a trading sell signal, & normally the first indication which an up-trend might soon end or start to consolidate.

Drawing an upwards Trend Line

When the online Bitcoin bitcoin market moves up it forms higher highs and higher lows forming a bullish movement. An upward trend line then can be drawn by connecting/joining these higher lows.

To draw this setup we use support zones made by the market prices. To draw an up-wards trend line correctly 2 support zones are needed. When price tests/touches this upwards trendline we buy and place a stoploss order just a couple of pips below this upward trendline. Diagram below shows 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 setup will show the overall direction of the Bitcoin market as bullish therefore traders only will open buy trade positions as long as price movement is within this setup & within the support areas. These are the points where if the market price retraces then these areas will offer major supports for the Bitcoin price. This is why many buyers will wait til price retraces downwards and hits these retracements levels to open buy trade transactions.

Trades opened at these levels have a very high Risk : Reward Ratio and are very profitable.

In the above set-up the BTCUSD trader would have opened 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 minimum amount of downdraw down/retracement. This is why many Bitcoin traders like to trade using this trend-line trade setup.

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.

How to Draw Upwards Bitcoin Trend Lines & Upward Bitcoin Channels on Bitcoin 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, tools for drawing setups are found within the line drawing toolbar. If the toolbar isn't visible, activate it by selecting "View" next to "File," then clicking on "Tool Bars," followed by checking the "Lines Toolbar" option.

Shown Below is the screen shot of the MetaTrader 5 trend lines drawing toolbar. To draw a trend line on a chart click this tool & select the point where you want to draw.

Drawing Upward Bitcoin Trend Lines & Drawing Upward Bitcoin Channels on Bitcoin Price Charts

MT5 Toolbar for Drawing Upward Trendline & Channels

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