What are the COMMON MISTAKES traders do when drawing trend lines?
Drawing trend lines is one of the few easy techniques that really WORK. Prices respect a trend line or break through it resulting in a massive move. Drawing good trend lines is the MOST REWARDING skill.
The problem is, as you may have already experienced, too many false breakouts. You see trend lines everywhere, however not all trend lines should be considered. You have to distinguish between STRONG and WEAK trend lines.
One good guideline is that a strong trend line should have AT LEAST THREE touching points. Trend lines with more than four touching points are MONSTER trend lines and you should be always prepared for the massive breakout!
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Chart patterns such as “Triangles, Flags, and Wedges” are price formations that will provide you with consistent profits. Before the age of computing power, the professionals used to analyze every single chart to search for chart patterns. This kind of analysis was very time-consuming, but it was worth it. Now it’s time to use powerful dedicated computers that will do the job for you. Get Forex Trendy the intelligent software solution with audible alerts and receive more super tips about trading chart patterns!
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