Lines of Trends and Lines Channel Currency Market - Forex For Beginners!

Trend - directional price movement in one direction or another. Somehow it is assumed that prices can only rise or fall, but a fairly significant amount of time currencies traded in narrow price ranges. Therefore, more correctly, it would be, in full accordance with Dow theory, three types of trends:

1. "Bull" (or upward) - prices are rising (the definition went from a comparison with bull horns, which raises production);

2. "Bear" - prices are falling (in this case bear "lean" whole body on the price and "crushed" her by herself);

3. "Flat" (or lateral) - prices are in narrow price ranges. Typically, market consolidation occurs before the subsequent rapid growth or decline in prices.

Thus, before technical analysts, there are two targets:

1. Determine the trend - for this, usually used trend indicators and trend lines or channels.

2. Determine the strength of the trend - this will help you oscillators (Oscillators are used to determine the strength of a trend in the currency market and the opening position in a flat!) and graphical models.

Channel Lines: construction and main signals.

Important role in the trend analysis are the channel, which is a kind of limiters magnitude of exchange rate fluctuations. First, construct a trend line, then parallel to a straight line. One of the lines connecting peaks of a price chart, the other - bottoms.

The practical value of the channel lines that:

A landmark, where you can record a gain or loss. In the case of upward channel Take Profit orders can be put under the top line, and Stop Loss - at the bottom. In the case of the downward channel Order Take Profit should be placed on the bottom line, and Stop Loss - over top.
If the price is not reached the top of the line upward channel (bottom line of the downward channel), this indicates the weakness of the current trend.

To construct lines canal in MetaTrader 4 highlight the trend line by double clicking the left mouse button, click (and hold) the Ctrl key and move the parallel line that appears in its place in the chart price. Then release the key Ctrl.

And the trend lines and channel lines are basically lines of support / resistance.