Upward Trend Lines & Channels - MetaTrader 4 Tools for Drawing Trend Lines and Channels
An upwards trend line is plotted below the trend setup by joining at least 2 lows. This upward trend line will draw a line that show the over-all direction of the price.
The exemplification presented below shows how price moves when it is moving in a bullish market. The price will move upward forming support levels.
Since the market moves in a zigzag manner traders usually draw a trend-line which portrays the general up-ward direction of the price.
A uptrend occurs when the price makes and forms consecutive higher highs and higher lows. Each price high being higher than the previous and prior high - higher high, & each low is higher than the previous and prior low - higher low.
Uptrend-lines gain more validity each time price tests/touches this upwards trend-line but doesn't penetrate it. A uptrend remains in play til this series of higher highs & higher lows is broken.
A down-side penetration of an upward trend line is a trading sell signal, & normally the first indicator which an upwards trend might soon end.
Drawing an Upward Forex Trend Line - Upward Forex Trend Line MT4 Trend Line Indicator
When the market moves upwards it forms higher highs and higher lows forming a bullish price movement - Upward Forex Trend. An upward trendline can then be drawn by joining the higher lows.
To draw this up-ward trendline setup we use supports. To draw the upwards trend line correctly 2 support areas are needed. When price tests/touches the upwards trend line we buy & place stop losses just a couple of pips below the upwards trend line. Example below shows an example of an upward trend-line.
The upward trend line setup will show the general direction of the price as bullish thence traders only will open buy long trades as long as price is within this upwards trend bullish market setup & within the support levels. These support levels are the levels where if the price retraces then these areas will offer strong supports for the price. This is why many forex buyers will wait til price retraces downwards and hits these retracements levels market the upwards trend line to open buy trades. Trades opened at this support levels have a high Risk : Reward Ratio with minimum draw-down.
In the above upward trend line setup the trader would have opened buy/long trade transactions from the trading signals derived & generated at the support1, support2, support3 and these trade positions would have made a lot of profits with minimum amount of drawdown/retracement.
Upward Forex Channel - Upward Forex Channel MetaTrader 4 Channel Indicator
An upward channel is drawn by drawing a line that is parallel to the upwards trend line and then adjusted to touch the top boundary of the price movement. This then forms an upward channel & as long as the market stays and remains between the two trend channels the bullish upward market movement will continue heading upwards.
Trading the Channel - How to Trade Upward Forex Channel
This upward channel is used by the traders to illustrate levels where it is best to tp orders. Traders will take some profit once the price tests/touches the upper channel and wait for another retracement before opening a long buy trade again.
MetaTrader 4 Tools for Drawing Trend-Lines and Channels
The MetaTrader 4 Trend-Line Indicator drawing tools to draw these trend lines & channels setups on the MT4 are located on the MT4 drawing tool-bar within the MetaTrader 4 platform software, To access this MT4 tool-bar if it isn't activated in your platform, Click in "View" Next to "File" menu at the left top corner of MT4 software & click View, Then Click in ToolBars, Then Tick "Lines Tool-Bar" by clicking on it.
Shown Below is the screen shot Image of the MetaTrader 4 drawing tool-bar. To draw a trendline on a trading chart click on this MT4 trend-line plotting tool & choose the point where you as a trader want to plot the trend line.
This is one of the learn forex analysis lesson among the many learn forex trading tutorials on this website located on the side navigation menu, where you'll learn how to draw trend-lines & analyze these trend lines setups.
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