How do foreign exchange investors use trend lines? Trend lines are widely used in foreign exchange transactions. Investors will use trend lines when conducting foreign exchange technical analysis.
It is inevitable for the foreign exchange market to have an adjustment decline in an upward trend, but this phenomenon is often just close to the upward trend line; an adjustment rise in a downward trend is inevitable, but this phenomenon is often only relative to the decline Trend line. Only when the trend line is effectively broken will the trend turn.
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 critical it is, and it has a decisive effect on the trend; on the contrary, when this critical trend line is broken, it has greater significance, so pay attention to it. Sometimes the price point of a particular day breaks the line, but as long as that day's closing price returns above the line, the break can be regarded as invalid.
What is an effective breakthrough?
When the closing price breaks the trend line by 3% and the time is more than 2-3 days. Once the upward or downward trend line is broken, their roles will be interchanged-support becomes resistance, and resistance becomes support.
Anything in the foreign exchange market can go its opposite. In addition, the slope of the trend line is also important-it makes the most sense when the hill is 45 degrees. The pitch reflects that the rate of rising or fall is a perfect balance between price and time. If the slope is too steep, the rise or fall is too fast, and it is generally challenging to last. If the trend line is broken, it means that the original trend slope will be adjusted to 45 degrees rather than a trend reversal; if it is too flat, the trend is weak and unreliable. And it will evolve into "no trend." Sometimes it is necessary to adjust the trend line to adapt to the slower or faster trend. There are always several price trends at different times in the market, so you can use several other trend lines to distinguish the movements of each level accordingly.