Rules for Drawing Trendlines

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dklepak

Hi Everyone. I'm a new member to this site and also new to the trading world. I was hoping that someone can help me out with defining the exact or concrete rules for drawing trendlines. I read couple of books on how to draw trendlines, however non of those books give a specific definition where to start drawing them. I read Trader Vic's rules on drawing TL as well as Tom Demark's rules on how to apply them. What I am struggling with is the idea where exactly do I start drawing TL on the lower timeframes as there is a lot more noise in the market. It is easy to draw trendlines on the monthly, weekly and daily charts, but when it comes to the 4 hour and 1 hour charts I am struggling to find the right anchor point. Is there anyone on this forum who specialize in Trendlines and can help me out. If yes, I got the below questions.

1st Question.

When it comes to 4 hour and 1 hour chart. Do you start drawing Trendlines from the beginning of the trend where you can see a clear sequence of HH and HL in uptrend (as an example? What about the situation where for a short period of time the HL was broken but then it created another HH. Do you look at more data or you just draw the trendline from the low point that preceded the new HH?

2nd Question.

How do you adjust trendlines? Do you you look at the most recent HL and connect it with the anchor point? What about the swings inbetween? are they deemed irrelevant?

Please see the screenshot below for illustration. Which of the TLs are correct. A B or C?
 

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Define the trend in TA terms, then based on your definition it will be easy to draw the trendlines

The problem is that the correct definition of the trend if biggest part of the working method (which very few have), that is why you should not expect to find it in the books or to get the specific answers here.
 
Hi, by TA do you mean Trend Analysis? It just my educated guess. I am not looking for a specific answers here, I just would like someone to point in the right direction. Thank You.
 
all I really want to achieve by starting this thread is an explanation when the trendline should begin really. Is it at the lowest point on the chart or should it start in the place where you can see the right sequence of HH and HL? All I want to have really is a set of rules on how to draw a trendline, so it's not subjective anymore.
 
dklepak said:
Please see the screenshot below for illustration. Which of the TLs are correct. A B or C?
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B was correct until it was broken.

After that, C was correct until it was broken.

After that, A was correct.

As qxr1101 wisely comments above, the problem is that the correct definition of the trend is biggest part of the working method.

I "trust" only horizontal trend-lines, myself.
 
Xela said:
B was correct until it was broken.

After that, C was correct until it was broken.

After that, A was correct.

As qxr1101 wisely comments above, the problem is that the correct definition of the trend is biggest part of the working method.

I "trust" only horizontal trend-lines, myself.
More...
Yes and even those can "cluster" and form zones. Markets do not conform to geometric certainty and one develops over time the ability to see support and resistance areas in real time. I use MA's to serve as dynamic S/R levels...it works for me.
 
I agree with what you all are saying, but there is still a question on where do you start drawing trendlines, is at the beginning of trend and then adjust it to the last HL without cutting through any other candles as per Vic S, drawing rules or you draw the trendline from the most recent troughs or peaks? or both of them are correct?
 
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