When drawing trend lines is there a sort of ‘general’ period you should use for the lines i.e. do you ‘generally’ draw trend lines for the past month or the past two months or the past six months or the past five minutes?
The reason I ask is that I am just contemplating the USD/MXN pair and although this has definately traded within a range for the past couple of months that range is also definately following a slight trend IF AND ONLY IF you draw the trendlines from September 2006 till now on the Daily Charts. If you draw the trendlines starting before September you get a totally different picture (and yes - I know it is an ‘Exotic’ but I am pretty sure that you will find this every single pair if you look hard enough).
When I used to use trend lines, I would draw them on the Month, week, day, and one hour charts. Each time frame has different information. If this doesn’t confusing to you, you can use it to you advantage.
(That may have sounded mean, It was not to be. )
I am just trying to work out which way to go with the USD/MXN pair.
I have been playing around with Parabolic SAR settings and basically I want to try my theories out (already discussed in another thread). The problem is that basing my trade purely on my Parabolic SAR settings I must only enter a trade when the first Parabolic SAR Dot appears GOING WITH THE TREND if that makes sense. The problem is - which trend? On the daily - the trend will be one thing (and that depends on how far back you go), on the four hour - the trend will probably be different - and to wait for the trend to be the same on all of the charts - well - you’d never enter a trade.
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