How to Identify Trends on Charts
How Do You Identify Trends on Charts?
To identify a traders need to use tools that help in determining & spotting a trend.
Most popular tool to identify a trend is:
Trend Lines
A xauusd trend line shows the points of support and resistance for the price, based on the direction of market.
For an upward moving trend the trendline will displays the points of support
For a down-wards moving trend the trend will display levels of resistance
These trend lines are mainly used by many trader to determine these resistance & support zones.
Trend line is a straight line that connects two or more price points on a chart & then extends into the future to act as a level of support or resistance. There are two types of gold trend: upward trend and downward trend. Trendline is an aspect of XAUUSD technical analysis that uses line studies to try & predict where the next price move will head to. A trader should know how to draw & interpret the signals generated by this trend line tool.
The basis of this trend line analysis is based upon the idea that prices move in trends. Trend lines are used to show three things.
- The general price direction - up or down.
- The strength of the current move - and
- Where future support & resistance will be likely located
If xauusd trend lines forms in a certain direction then market usually moves in that direction for a period of time until a time when trend-line is broken.
Plotting these trendlines on chart displays the general xauusd trend of the market which can either be up-wards or down-ward.
Below is an example of how to draw these trend line on charts
Trendline Tutorial: Trading Draw and Trade Upward Trend Move Using Trend Lines
Trend Line Guide: Trading Draw and Trade Upward Trend Move Using Trend Lines
Trend-Line Tutorial: Trading Draw and Trade Downwards Trend Move using Trend Lines
Trend Line Course: Trading Draw and Trade Downwards Trend Move using Trend Lines
How Do You Identify Trends on Charts?
