It is not always effective to trade with trendlines. There are times and there are signs we need to avoid trading. But many traders do not pay attention to these signs.

Many traders trade with a very stereotypical trendline for example, every time the price hits the trendline, an entry is entered or the price breaks the trendline to reverse, etc. In fact, price has many ways of reacting. corresponds to the trend line. If you want to trade trendlines effectively, you have to understand what the market is like when approaching trendlines and what signals warn you whether or not you should or should not trade with trendlines. direction.

Here are 3 signs that you should avoid trading with the trend line that traders should pay attention to.

Don't trade with trendline without confirmation signal

Note that a true trendline is effective when there are 3 or more touch points. If a trend line has 2 touch points, it is not strong enough.

Either the trend line must have a very strong bottom or top in the trend, which acts as a support for the main trend and is considered a strong support and resistance level. Then it is really safe to trade with the new trend line.

Besides determining the number of touch points, you should also wait for a confirmed trade setup such as a candlestick pattern or price retracement of strong support resistance or divergence signal, etc. then enter the trade.


Don't move the trend line after trading

If you have moved the trend line after trading it is best not to trade with this new trend line, as it needs more confirmation.

Many traders keep moving the trendline to look good or to get a strong setup. But this is what makes trendline trading lose its objectivity.

So traders should keep a fixed and disciplined way of drawing trend lines. Don't adjust the trendline at will.

Don't trade when the trend line is too steep

If the trend line is too steep, it will not be sustainable. Such trend lines are often easily broken. If trading in steep trend lines, the strategy will be prone to failure.

A trendline is considered steep when they are at an angle of 70 degrees or more. For these cases, you are better off waiting for the trendline to break and trade in the opposite direction.

According to Gann theory, trend lines are considered fine when at a 45 degree angle is best.