Series 3: 6.2.2.2. Trend Lines

6.2.2.2. Trend Lines

A trend line is a straight line that connects two or more price points and then extends into the future to act as a line of support or resistance. An uptrend line is a line sloping upwards along successive troughs. Each succeeding low on the uptrend line must be higher than the one before it. A downtrend line is a line sloping downward along successive peaks. Two points are enough to establish a trend line, but a third is required to confirm its validity.

A trend that is set in motion tends to remain in motion. Once it establishes a certain slope, the trend line is a good predictor of the price