How to trade trend lines in the Forex market

Step 1Forex chart with a trendline break.

When trading the forex market you want to use 5 minute to 30 minute charts if you are daytrading.If you are trading longer term then 60 minute to a 1 day forex chart work best. Up Trend LineAn up trend line has a positive slope and is formed by connecting two of more low points. The second low must be higher than the first for the line to have a positive slope. Up trend lines act as support and indicate that demand is increasing even as the price rises. A rising price combined with increasing demand is very bullish and shows a strong determination on the part of the buyers. As long as prices remain above the trend line, the up trend is considered solid and intact. A break below the up trend line indicates that demand has weakened and a change in trend could occur.Down Trend LineA down trend line has a negative slope and is formed by connecting two or more high points. The second high must be lower than the first for the line to have a negative slope. Down trend lines act as resistance and indicate that supply is increasing even as the price declines. A declining price combined with increasing supply is very bearish and shows the strong resolve of the sellers. As long as prices remain below the down trend line, the downtrend is considered solid and intact. A break above the down trend line indicates that net-supply is decreasing and a change of trend could occur.When you draw an up trend line, you connect the lows of the bars or candlesticks if you are using candlestick charts.Drawing a down trend line, you connect the highs. The first step in constructing a trend line is to choose the time frame: 5 minute,30 minute or longer chart time frames. A long-term time frame can be from 1 day or up to a year, an intermediate period several weeks to several months, and short term will be less than a day to several weeks. The periodicity of the charts, intraday, daily, or weekly will depend on the time frame chosen for trading, in any case, the procedure for drawing the trend line will be the same.Remember you can draw horizontal trend lines to define support and resistance levels.These levels are very important and most forex traders will trade off the support and resistance chart levels