Trendline trader makes trendlines you draw on the chart alotmore useful than just a visual tool by itself. Trendlines are notindicators but simple lines you draw up on your currency chart tohelp with forex technical analysis. When you draw trend lines, you are providing yourself a visualpicture of where is the current market and where will it be headingnext. And this serves as a mental note assuring yourself that you areaware of where the trend is coming from and that you are alsowilling to follow it where ever it chooses to go next.
“Trendline Trader” as the name connotes speaks foritself. It helps a trader to identity possible pullbacks on bothresistance and support levels, for the purpose of makingsound trading decisions. Many technical chart patternsrequire that trade entry and exit be executed on thesespecially drawn trendlines.
There are two ways at which the forextrader can choose to trade with thesetrendlines.
The first way is trading via breakout strategy withtechnical chart patterns. When price breaks through thetrendline, a trade intended on the breakout direction can thenbe entered according to the trader’s trading system. This particular style of breakout trading can easily befound in many trading systems that tradeflags, pennants, head and shoulder patterns, symmetricaltriangles, descending or ascending triangles or simply achannel or envelope. Break-through of trendline is animportant entry signal for many traders trading technicalchart patterns.
The second way of trading with these specially drawntrendlines is trading on reject. When price touches orbreaks through the trendline, trade entry will be entered inanticipation that price will meet great resistance orsupport and will revert back to its ranging levels.Thereby, the word trading on reject anticipates that pricewill revert to its ranging mode and you are fading abreakout. This style of trading is usually called fading thebreakout. Or if it’s in the form of trend trading, as priceapproached support or resistance level, you areanticipating that it will bounce off the trendline like a ballbounces off the ground and ceiling trading in a channel.
Trading on breakout and on reject can now be madeautomated in mt4. You can find most auto trendline trader on theforex community. And you can give the free ones a try as theycontain the most basic functions of an auto trendline trader EA. Now, a trade entry or exit can be pre-specified by the forextrader simply by attaching the trendline trader to the respectivecurrency chart and draw lines manually on the chart. Next, simplyadd in a buy or sell on the trendline description box to instruct thetrendline trader EA to perform trade execution to your liking.
Forex traders can tap on the auto trendline tradersoftware to execute forex trades while they do other work.Forex trading is not an easy work for most part-time tradersin the past. They need to monitor the market for potentialsignals and then manage the ongoing trade until it is finallyexited. Most of these tasks are no longer relevant if the forextrader utilize trendline trader as their trading tool.
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