Rather than write one epic post, I thought it might be easier to absorb this in several, smaller posts. I will wrap this one up here with two parting thoughts and a chart example. First, the trendline defines the limits of the swings that compose the trend, so it is important to be sure there actually are swings before you draw a line. For instance, if you see many consecutive bars where you can draw a line across the lows of those bars (this tends to be common in parabolic moves near the end of trends), a trendline drawn across those lows will probably not be meaningful. You can draw the line, just don\u2019t expect anything out of it! Secondly, do not cut prices when you draw a trendline. Especially with candlestick charts, it can be tempting to draw lines that cut shadows. Again, you can do that, but if the line already cuts price in the past, why should you pay any attention when prices go through it in the future? In my next blog post, we will look at a few more refinements in using and drawing trendlines on price charts.<\/p>\n
![\"\"](\"http:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2010\/05\/trendlines.jpg\" "\\"trendlines\\"")
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