Trend Lines and Trend Following Stocks – Stock Trading
Trend lines are one of the most common trend following tools. While they generally don’t provide a tradable signal, they do offer clear direction of the trend. Very simply stated a trend line is a line of supporting low prices a stock reaches and finds new buying interest. These are low points within an uptrend that allow traders to buy more of the position or enter the trade for the first time. The most basic trend line drawing technique is simply connecting the lows from the lower left to the upper right of the chart. The Market Trend Signal™ trend following trading system is looking for confirmation after a support line has been reached.
In the example of DFT, the uptrend is firmly in place, but the HOLD signal is given as the stock reaches the support up trend line. This is because the trend may be pausing or it actually may be weakening and could be cause for further monitoring. The BUY signals are generating as confirmation of the support holds and the stock starts to trend higher. Trend Lines are a good tool for eyeballing the trend in most basic stock chart systems.
Market Trend Signal™ trend following stocks trading system
Jesse Webb
Market Trend Signal™
Trend Following Stocks – Stock Ratings – Market Timing
