Trend line of foreign exchange

foreign exchange marketIn an uptrend, an adjustment decline is inevitable, but this phenomenon is often only close to the uptrend line; in a downtrend, an adjustment rise is inevitable, but this phenomenon is often only close to the downtrend line. The trend turns only when the trend line is effectively broken.

What kind of trend line is important - the longer the line has not been touched or the more times it has been tested, the more important it is, and has a decisive effect on the trend; on the contrary, when this important trend line is broken, it is more significant and should be very careful. Sometimes a check point breaks the line on a certain day, but as long as the closing price of that day is back above the line, the break is considered invalid.

What is an effective breakout? It is when the closing price breaks the trendline by 3% and takes more than 2-3 days. Once the rising or falling trendlines are broken, their roles will be reversed - support becomes resistance, and resistance becomes support.

Anything in the foreign exchange market can go its own way. In addition, the slope of the trend line is also important - most meaningful when the slope is 45 degrees. The slope reflects the rate of rise or fall, which is exactly the perfect balance of price and time. If the slope is too steep, it means that the rise or fall is too fast, which is generally difficult to last. If the trend line is broken, it means that the original trend slope will be adjusted to 45 degrees, rather than a reversal of the trend. If it is too flat, it means that the trend is weak and unreliable and will evolve into "no trend". Sometimes the trend line needs to be adjusted to adapt to the trend slowing or getting faster. There are always several price trends in the market at different times, so several different trend lines can be used accordingly to distinguish the trends of each grade.