Does trendline work?

Discussion in 'Technical Analysis' started by GloriaBrown, Aug 17, 2019.

  1. cashclay

    cashclay

    I think trendlines are important if the stock is represented to respect it ... However, intraday trading you have other things to take into account.. I dont think treadlines should be traded for so many hours. atleast 1 hour treadline is ok... after that i feel it can be dangerous ....
     
    #371     Aug 15, 2023
  2. PPC

    PPC

    Trendlines sometimes work, sometimes they don’t . . . just like other TA tools.

    Legendary trader Marty Schwartz (Pit bull) said in one of his interviews that he mostly draws lots of trendlines on charts.

    In the past I used to trade predominantly with trendlines myself, and they do work if one knows how to draw them properly and how to interpret each trendline into the proper overall PA context.

    Few days ago, I’ve posted live charts with trendlines in another thread. I’m reposting the charts here so you can see that trendlines do work, but obviously it’s not just a matter of drawing one line on the chart and expecting to make money. Trading is a craft, and trader just like any craftsman needs to develop his skills to be able to choose and use the most appropriate tool for each individual job / situation.


    upload_2023-8-16_10-46-45.png


    upload_2023-8-16_10-47-46.png
     
    #372     Aug 15, 2023
    comagnum likes this.
  3. comagnum

    comagnum

    Trend lines - yea, I pay attention to them.

    upload_2023-8-15_16-55-35.png
     
    #373     Aug 15, 2023
    Laissez Faire, schizo and PPC like this.
  4. Jzwu2017

    Jzwu2017

    Trend line works until it doesn’t, just like the countless indicators. In a nutshell, nothing works 100% reliably in trading. Otherwise, you’d have found the holy grail, which doesn’t exist in trading.
     
    #374     Aug 15, 2023
    DevBru likes this.
  5. DevBru

    DevBru

    It does until it doesn't. Every trendline will be broken someday, question is when, downside is you won't know in advance.

    Trendlines alone will never give you an edge. Could they help? Maybe sometimes, the issue with trendlines is that they will be different for a lot of people, give the exact same chart to 100 people and ask them to draw trendlines, you will probably get loads of different charts back.

    I prefer to look at levels that are exactly the same for everyone, such as daily or weekly highs.
     
    #375     Aug 15, 2023
    Jzwu2017 likes this.
  6. schizo

    schizo

    Well, I think you're drawing them TLs wrong. They look way too arbitrary, no reason or rhyme.
     
    #376     Aug 16, 2023
  7. PPC

    PPC

    How would you draw them?

    For comparison, can you please post the same chart (SPX Daily) to see how many touches your trendlines have?
     
    Last edited: Aug 16, 2023
    #377     Aug 16, 2023
  8. The main problem from my perspective is the amount of false breakouts that comes out of these trend lines. It just doesn't seem consistent enough. It seems like you need something more in order to know when it's likely a real break and when it's a false one.

    Add to that, we now have @schizo and @PPC in disagreement on how to draw them. It seems largely subjective.

    Like you, I prefer objective OHLC levels and associated statistics for the big picture.
     
    #378     Aug 16, 2023
  9. SPX Weekly as of Tuesday's Close:

    upload_2023-8-16_12-30-17.png

    Maybe I drew it incorrectly. I'm open to receive feedback.

    But it does look like it's breaking.

    So, is this a sell signal? Or will the markets start reversing today and that weekly bar will close green and end the week with a large wick/tail to the downside after an early week shakeout?
     
    #379     Aug 16, 2023
  10. deaddog

    deaddog

    Dfferent trend line if you go back to when the trend started last Oct.
     
    #380     Aug 16, 2023