Trading Commodity Draw a Commodities Trendline on a Chart

How to Draw a Commodities Trend-Line on a Chart - How to Draw Commodity Trend Lines on Commodities Trading Charts

Principles of How to Draw a Commodities Trend Line on a Chart

1. Use commodity candle-stick charts to draw commodity trend lines

2. The points used to draw a commodity trendline on a commodity chart are along the lows of the commodities price bars in a bullish commodities trading market. An upward bullish commodity trend is defined by higher highs & higher lows.
3. The points used to draw a commodity trendline on a commodity chart are along the highs of the commodities price bars in a bearish commodities trading market. A downward bearish commodity trend is defined by lower highs and lower lows.
4. The points used to draw commodity trend lines on the commodities charts are the extremes points - the high or the low commodities price. These extremes are important because a close beyond the extreme chart points tells commodity traders the commodity trend of commodity might be changing. This is an entry or an exit commodities trading signal.
5. The more often a commodity trendline on a commodity chart is hit but it is not broken, the more powerful its commodity trend signal.

Example 1: How to Draw a Commodities Upward Commodities Trend Line on a Chart

To draw an upward commodity trendline on a commodity chart use two support points in a bullish upwards commodity trend so as to plot the upwards commodity trend line and then extend the commodity trend line as displayed below. The upwards commodity trendline on a commodity chart will show the general direction of commodities prices and as long as commodities price is above this upwards commodity trend line then the upwards commodity trend will remain intact - bullish upwards commodities trend.

If commodities prices move below the upward commodity trend line which is the support level for the bullish upwards commodity trend then commodities traders should close all their open commodities trades - because this might be a commodity trend reversal commodity signal. In an upward commodity trend commodities price should generally stay above the support area which is marked by the upwards commodity trend line on the commodities charts.

Draw a Commodities Up Trendline on a Chart in Commodity Trading

How to Draw an Upward Commodities Trend Line on a Chart - How to Draw a Commodities Trend-Line on a Chart

Example 2: How to Draw a Commodities Downward Commodities Trend Line on a Chart

To draw a downwards commodity trendline on a commodity chart use two resistance points in a bearish downwards commodity trend so as to plot the downwards commodity trend line and then extend the commodity trend line as displayed below. The downwards commodity trendline on a commodity chart will show the general direction of commodities prices and as long as commodities price is below this downward commodity trend line then the downward commodity trend will remain intact - bearish downwards commodities trend.

If commodities prices move above the downwards commodity trend line which is the resistance level for the bearish downward commodity trend then traders should close all their open commodities trades - because this might be a commodity trend reversal commodity signal. In an downward commodity trend commodities price should generally stay below the resistance area which is marked by the downward commodity trendline on a commodities chart.

Draw a Commodities Down Trendline on a Chart in Commodity Trading

How to Draw Downwards Commodities Trend Line on a Chart - How to Draw a Commodities Trend-Line on a Chart