Tag: What is Trendline and its importance?

How To Draw A Trendline?
1. Connect the latest two obvious valleys (swing lows) and peaks (swing highs).
2. These valleys and peaks must be clear and obvious. If they are not, consider them as pauses. If they are not clear basing should be unclear and poor and removal would be expected anyway.
3. Update the trendline every time there is a new valley or peak
4. Each timeframe has its own trendline independent from other timeframes and this is where subjectivity comes into in other methodologies
5. Continuation Patterns (CPs) will not be used to connect trendlines unless there are 3 or more (over-extension)