Recently the Euro FX was in a well defined hourly downtrend channel. Just play around with the highs, lows and extremes and you will find it. I like to watch for false breakouts of these channels, particularly news related. Many times price will snap back in the channel and continue on its business. This example was when the Euro recently gapped down on the German elections. A nice trade set up, albeit a very nerve racking one. But I played the channel trade to fill to the top of the channel. Here is the trade and I will follow up with the result.
Here is the result. I remember debating whether to get out of the market before the fed annoucement. I decided not too and it was a bad decision. I generally always get flat. (This is another topic though). You could have enterd at the bottom of this channel near the NY close. For any of those in this trade at the time you may well remember that a Central Bank came in a began 2-3 bln of buying in the face of adversity. I almost got out for fear of the bottom channel not holding. My stop was below the swing low, but you can also use the channel as an excellent stop guide. I hope this helps. I do find it a little more difficult to draw trend channels on the indexes, but it can be done very effectively. I just like to watch things at night during the asian and london markets.
If you will tell me what you are trading I will take a look at it on a 3-5 minute basis and see if I can come up with anything. Off to soccer games today or futbol if you are from any other place on earth.
I really do not have a good answer because I have used trendlines with shorter time frames...however, trendlines are trendlines and they work thru all time frames.
i dont understand how you draw them. it looks like your're not drawing them cleanly thru highs or lows.
Drawing trendlines is more of an art than an exact exercise. You can draw them based on open, low, close prices for instance. Based on linear regression or others. What I do is attempt to as many common points as possible, then if you have extremes draw another line at this point. I like to keep my lines tight if I am not sure. At these points, I will take profit or take some risk/contracts off the table and ring the register. Why don't you gin up a picture with the instrument you trade and lets have a look.
I use T/L all the time on 1, 3 and 5 min intraday charts. I use them mainly to stay in a trade (i.e. as long as the trend continues, stay in the trade, exit on a CLOSE above/below the T/L). Agree its not an exact science. Need to wait for a 10-15 bars before I start drawing. If you like T/L's you would probably do well to study Point& Figure charting. I have a pretty neat system for trading S&P500 futures by Barry Lend. It uses P&F and T/L, thats all. Another thing I note on my charts is previous day close, new day high and low (morning range). Allways want to be aware of action at these levels, sometimes significant moves happen at these points. Look at chart of XOM Friday, and note that once it broke 64.10 level it moved steadily down to 63.60. This was prior day low and support on Friday. Note also that prior day close was resistance.