i’m finding that trendline breaks are the one of the best ways of trading (better than moving average crossovers and what not).
what tools do you guys use to confirm that a trendline break is a trade and not a whipsaw?
I tend to wait for a convincing close above or below the trendline in question. But it has to be a convincing move. If price breaks the trendline by just sort of drifting sideways through it, then i won’t take the trade.
Another method you might consider is not taking the trade right away but rather waiting to see if price tests the trendline again. In the case of a short trade do not take the trade as soon as you get that break. Wait for it to come back and see if the line is tested as resistance. If it successfully holds, then take the short.
thanx pipbull, i learned quickly not to take the trade when price action sort of neanders thru the trendline.
which timeframe charts are you taking trendline break trades off of?
Set an EMA, 34 peroid to the High, Low and close. This is a damn good indicator, you can also see how the market will retrace inside this wave.