MT4 Tools for Drawing Stock Trend Lines and Stocks Channels
An upward stock trend line is drawn below the stock trend pattern by connecting at least two lows. This upward stock trend line will draw a line that show the general direction of the stocks trading market.
The diagram below shows how stocks price moves when it is moving in a bullish market. The stocks price will move upwards forming support levels.
Since the stocks trading market moves in a zigzag manner stock traders normally draw a stock trend line which shows the general upwards direction of the stocks trading market.
A up stock trend occurs when the fore stocks price makes consecutive higher highs and higher lows. Each high is higher than the previous high - higher high , and each low is higher than the previous low - higher low.
Stock Up trend lines gain more validity each time stocks price touches this upward stock trend line but does not penetrate it. A up stock trend remains in place until this series of higher highs and higher lows is broken.
A downside penetration of an upward stock trend line is a technical sell stock trading signal, and usually the first indication that an upward stock trend may soon end.
Upward Stock Trend Line MT4 Stock Trend Line Indicator
When the stocks trading market moves up it forms higher highs and higher lows forming a bullish market movement - Upward Stock Trend. An upward stock trend line can then be drawn by connecting these higher lows.
To draw this upward stock trend line setup we use supports. To draw the upward stock trend line correctly two support levels are needed. When stocks price touches the upward stock trend line we buy and place stop loss stock orders just a few pips below the upward stock trend line. The diagram below shows an example of an upward stock trend line.
The stock upward stock trend line setup will show the general direction of the stocks trading market as bullish therefore stock traders will only open buy long stocks trades as long as stocks price is within this upward stock trend bullish market setup and within the support levels. These support levels are the levels where if the stocks trading market retraces then these points will provide strong supports for the stock price. This is why many stock buyers will wait until stocks price retraces downwards and hits these retracements levels market the upward stock trend line to open buy stocks trades. Stock trades opened at this support levels have a high Risk to Reward Ratio with minimum draw down.
In the above upward stock trend line stocks trading setup the stock trader would have opened buy/long stocks trades from the signals generated at the support1, support2, support3 and these stocks trades would have made a lot of profits with minimum amount of draw-down/retracement.
Upward Stock Channel MT4 Channel Indicator
An upward stock channel is drawn by drawing a line that is parallel to the upward stock trend line and then adjusted to touch the top boundary of the stocks price movement. This then forms an upward stock channel and as long as the stocks price stays between these two channels the bullish market movement will continue moving up.
How to Trade Upward Stocks Channel
This upward stock channel is used by stocks traders to show levels where it is best to take profits. Stock traders will take some profit once the stocks price touches the upper channel and wait for another retracement before opening a long buy stock trade again.
MT4 Tools For Drawing Stock Trend Lines and Channels
The MT4 Stock Trend Line Indicator drawing tools to draw these stock trend lines and stock channels setups on the MetaTrader 4 are located on the MT4 drawing tool bar within the MT4 stocks trading platform, To access this MetaTrader 4 tool bar if it is not activated on your stock trading platform, Click in "View" Next to "File" at the top left corner of the MetaTrader 4 stocks trading platform and click View, Then Click on Tool bars, Then Check the "Lines Toolbar" by clicking on it.
Below is the screenshot Image of the MetaTrader 4 drawing tool bar. To draw a stock trend line on a stock chart just click on this MetaTrader 4 stock trend line drawing tool and select the point where you want to draw the stock trend line.
This is one of the learn stocks trading analysis lesson among the many learn stock trading tutorials on this website located on the side navigation menu, where you will learn how to draw stock trend lines and analyze these stock trend lines setups.