Drawing Upward Trendlines and Channels

An up-wards trend line is a line drawn on the chart when the overall trend of the prices is moving upward & hence this line is drawn below these upward trending prices by connecting/joining at least 2 lows of the upwards price trend. This line will show the overall trend of the price to be upward.

The example illustration exhibited below explains this concept & explains and describes how the prices move when in an upwards trend. When the 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 ==22==trend--linetrend-linetrendline.

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

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.

Upwards Trend-Line - Bitcoin Trading

The trend line setup will show the general 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 the price movement. This then forms a channel of the price and as long as a remains in between the two channels the bullish movement of Bitcoin prices will continue heading up.

Upwards Channel - Bitcoin Trading

Trading the Upward Bitcoin Prices Channel

This upwards channel is used by Bitcoin traders to show levels where it best to take profit orders. Bitcoin cryptocurrency traders will take some profit once the price tests/touches upper channel & wait for another retracement before opening another buy trade position again.

MT5 Tools for Drawing Upward Trendline & Channels

The tools to draw these setups on the MT5 are located on the MetaTrader 5 line drawing toolbar within the MetaTrader 5 platform, to access this tool-bar if it ==22==isn'tis--not activated on your platform, Press in "View" Next to the "File" at the top-left corner of MT5 and click "View", Then Click on "Tool Bars", Then Tick and select the "Lines Toolbar" by pressing on it.

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.

MT5 Toolbar for Drawing Upward Trendline & Channels

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