Here is a daily chart of the ES. The black trendlines have been broken (price went through them). The purple trendlines have not yet been broken yet, although the top one may be broken soon. If the bottom one breaks, does that mean we are no longer in an uptrend?
Uptrendline could be broken and we could remain in an uptrend, uptrends are not defined by straight lines.
Your lines need some work. the pink line that is "almost" broken in your drawing is wrong. you cant use the bottom of the daily range on the first two points and not the third. If you used the bottom of the daily ranges on all 3 points then that trendline IS broken.
I have heard uptrends defined in the following ways: 1) a series of HH/HLs (some people say H/HL, some people say HH/HL, some people say HL/HH/HL, some people say HH/HL/HH/HL) 2) Anchor R becoming S 3) Trendlines 4) the slope of a MA I have been unable to fine one that consistently works for me. What are your thoughts?
So I am clear, you are saying that because I used the bottom of the daily range on the first two points to create the trendline, I therefore have to declare it broken when the daily range goes below the line, correct?
If thats how you draw the line, then yes. However if you draw the line at the bottom of the candle and not the bottom of the daily range, then that is also a broken trendline (which is how i prefer to draw the line by the way, at the bottom of the candle and not the bottom of the daily range)
Ok, that makes sense. It bothers me when people draw trendlines based on the candle close because it seems like you're ignoring data. Using the lowest point on the whole candle represents a valid price that the instrument actually traded at. What is your reasoning for using the body of the candle body? Do you do it that way only for daily candlesticks or on any timeframe?
That's just your opinion. Trend lines are subjective. There is no one "right" way to draw them. Drawing them so that they contain all of the price action on one side of them is just one way of doing things, which gives you one view of what the trend is. Drawing them so that they are a best fit to the swing points of the trend is another way of drawing them, and it is just as valid. Expecting a trend line to be an exact measure of the extremes of the trend is just as naive as expecting a horizontal line to exactly define a support or resistance level.
You obviously didn't read what I actually said? I said you can draw the trend line however you want, but you have to be consistent. If you use the bottom of the daily range as the bottom of your trendline, then if at any other point that range breaks the trendline then it is no longer a trendline. Just like if you use the bottom of the candle to draw the trendline, once the bottom of the candle ends under the trendline then it is broken. Edit: Im not going to really argue back and forth about this when I already said you can draw it however you want. However, whether you use the bottom of the daily range or the bottom of the candle one fact remains, the trend is broken in either scenario.