The above chart shows many trading opportunities. Lots of trading signals on the trendline and support level Let’s zoom the chart a little so we have a better picture of the trading opportunities. The trendline, the support, and the resistance are already drawn. We have here a chart for EURUSD currency pair with 5-minute interval candles. How to trade using the trendline with the support/resistance at Olymp Trade It is very probable, that you will soon use both directions. The horizontal line is infinite in both directions on the chart. The difference is that the latter has a limited beginning and end. You can also use the “Trend line” to draw support/resistance. You simply have to place it on the level, where it will connect at least two lows or highs. To draw the support and resistance lines, you have to click the graphical tools feature and choose “Horizontal line”. Newly developed uptrend with support-resistance levels Often, the previous support becomes new resistance and vice versa. And then, the new support and resistance levels will be formed. The price is bouncing back and not going beyond.Įventually, the price will break the support or resistance. The price seems not to go below it for a given time. The support and resistance levels are the borders, within which the price consolidation takes place. How to draw a support/resistance line on the chart The rest of the procedure remains the same. In the case of a downtrend, you will have to drag the cursor so it touches lower highs. It doesn’t have to reach all of them to have a valid trendline.
If there is an uptrend, you click the lowest price you see, then move the cursor so it touches higher lows. In the majority of cases, a 1 to 3 hours chart with 5-minute interval candles will be sufficient. Now you have to determine in which period there is the best trend visible. Once you are logged into your account and your chart is set, click on the indicators feature and then, select a Trend line.
The steeper the trendline the faster price is moving. The inclination of the line demonstrates the dynamic of the trend. The trendline shows you the trend direction.
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