Hi, can someone tell me where the correct placement of the downward trend line on this chart is please. Also Fib line would be helpful too. I keep drawing them but can never get down to just 1???
Hi Daren,
For this chart, on this timeframe, here’s my trend line. Also, a change of trend (imo) is when price breaks above the swing prior to the lowest swing low, marked.
Here’s my take on trend definition: http://forums.babypips.com/free-forex-trading-systems/66903-5m-tf-price-action-strategy.html#post637462
Don’t think too many people will disagree with jalapenoninja’s trend line here. I will say its dangerous ignoring wicks particularly on larger (1hr and up) time frames. They are legitimate footprints left behind from price action by the big players. But I agree in this case. If you’re looking for tips on drawing trend lines start on the higher time frames, weekly/daily and work down. Go WA
Hi jalapenoninja
Many thanks for your response, it has confirmed my trend line so now know I am on the right track.
Just another couple of questions. The long wick you are ignoring was a fundamental event as was the previous long candle. Would it be wise to ignore those candles completely and start the trend line further back as could consider this as an anomaly to the overall trend? Or am I over analysing.
IMO I thought this chart was shaping up to change Trend very soon but your take on this was a long way from mine I am always happy to be wrong as means I have learned something, I learned from pip school that when the price broke through support/resistance could be a strong indicator that a breakout was on the cards. Your suggesting and vey much respect your suggestion that the price would need to break through the trend line and 4 lines of resistance to confirm a breakout on this chart. Would I be correct in thinking that?
As you can probably tell I am very new but am working on my trading plan and want to incorporate trend lines as part of the plan. My questions may seem a bit dumb but want to be able to add trend lines in a consistent manner to every chart in the same way so I can start building a pattern in my journal.
Thanks
Daren
Try this indicator to help you. ZigZag. If you are using MT4 it’s in the indicators section on the Navigator. I started using it to draw trend lines. and with some practice you’ll find that you can look at a chart without it and immediately spot the trend. But in the beginning use it to confirm our trend analysis.
Another one I use to use was zz_Orlova. It’s a custom indicator that you can get from MQL site. It’s great for again to help you draw resistance. and support lines.
Fib line is drawn between the closest major support and resistance lines. Here’s where it gets tricky. Depending on ones near and major definition you can and most of the time especially if you’re using it on lower time frames get different answers. It’s the same as support, resistance and trend lines; generally the more you practice you get, the better you get at it. Here’s a great video on Fibonacci
How to Trade with Fibonacci Levels - YouTube
Hope that helps
Gp
There is no right or wrong to be honest. Different traders have a different point of view on where trend lines should be placed. In your case I think jalapenoninja drew one which is very accurate and most would likely agree with his assessment. Try to figure out what works for you and your strategy. Sometimes there are trendlines most agree with and there are other times where the opinion differs; neither one is incorrect.
I Disagree. The Trend line being depicted is the one the whole civilized world is drawing but its not the Smart money’s trend line.
Smart money doesn’t care to much for trendlines bro.Daren sees a possible break so is ready to buy. I see a channel and would get ready to sell. Its a matter of perspective.
I rest my case.
So where would “smart” money put a trend line? Please enlighten us and share your knowledge. And what’s the exchange rate for some of my “dumb” money?
I didn’t invent the trend line i just know where to place them and my success rate and profit gains are reliant on the fact that you don’t know how to properly place them. As for your “dumb money”… well you said it.
Hinting at hidden knowledge while knocking others’ posts and not posting an improvement or alternative kind of misses the point of a discussion group, and certainly makes one wonder why bother posting in this thread.
Usually in a discussion group if someone disagrees he isn’t met with a mocking or patronizing request for a difference of opinion explanation. I’m not referring to you.
Lesson learned though i’ll just mind my own business :59:
[QUOTE=“Jcandle;644209”] Usually in a discussion group if someone disagrees he isn’t met with a mocking or patronizing request for a difference of opinion explanation. I’m not referring to you.[/QUOTE]
Well I thought you were the sarcastic one so I guess all things are open to interpretation.
Please don’t. As a fellow trader and forum member we all value your experience, views and opinions. Even if we don’t agree. But our friend Daren was looking for help. Here’s my view on the chart
Hope that gives you a different perspective Daren. As I said I see a channel forming. Jcandle love to hear take on this
Hi All and many thanks for all your input, what have I learned? I am neither right or wrong unless of course I actually entered a trade based on my trend lines would have lost a few pips there lol (bobbillbrowne did you enter a trade on this). The responses have enforced my belief that trading is very personal and need to find my own trading groove that works for me. Traders are very passionate and sometimes a little sensitive which is surprising as thought we are supposed to be emotionless. I also have gained a lot of tips and a new perceptive as well as a load more studying (thanks gp0053).
For the record I have been trading for 4 weeks 16 trades in total 12-4 to the good and I am 100% sure would not have got this far without this website and the people who contribute to it good or bad as can learn from both.
Many Thanks to all babypips members and contributors. D
Daren, I believe you have the right attitude to succeed in this market. Just for the record I didn’t trade this, my style is get in get out and walk away so I work with a 70 tick chart. But you are right, trading is very very personal (which is why we can be sensitive) and you definitely need to find your own groove. Wishing you the best on your journey and look forward to hearing some more experiences from you. Bob
Ah, please don’t mind your own business. This is not one of those threads like " share everything you know, so I don’t have to do any work." There is more than one way to look at the market as well as more than one approach. Smart money is a label, no more or less than professional or institutional trader. The more info we get about approaches, methods, money management, stop losses etc., the better.
I don’t know if all of us are retail traders, but lets assume most of us are. As retail traders we have to canalize whats in front of us. Tech analysis is a big part of the picture and the shorter the time frame in which we are trying to get a positive result, the more important it is.
I’m not concerned with the: daily trend, weekly or monthly trends, not even the 4 or 1 hour time frames. My belief is that the market is continually in one of four places, so my analysis is geared to help me decide which one of those 4 continuous places it’s in. Other traders who hold different beliefs, may have different ideas about what helps them in their analysis. Doesn’t matter which one of us is right or wrong, if either, the important part is our beliefs and why we believe them. TThat’s what helps no matter what your style. This thread falls into the “whats better demo or live or how much should I trade in one position category.”
If someone is offended by what you say, apologize and move on. But don’t leave the discussion. It’s better to discuss methods, approaches and/or opinions, than semantics like is forex the same as gambling. Your answer will depend on what your definition of gambling is so there is no right or wrong answer. That’s my 2 cents.
Gp
I’m glad we cleared the air. I’m a Trader and yes I do love my work. I drew the trend lines and channel with a mid line as best as i could considering that there is no platform manipulation allowed and I’m constricted to just a screen shot of the market. So it’s sloppy Photoshop work but I.m a trader not a graphic artist lol.
P.S you would be looking for a buy at the bottom trendline which is a projection for the future decline to find support.
