Upward Commodities Trendlines and Channels

An upward commodity trend line is drawn below the commodity trend pattern by connecting at least two lows. This upward commodity trend line will draw a line that show the general direction of the market.

The diagram below shows how commodities trading price moves when it is moving in a bullish market. The commodities trading price will move upward forming support regions.

Since the commodity market moves in a zigzag manner commodity traders normally draw a commodity trendline which shows the general upward direction of the market.

A commodity up trend occurs when the fore commodities price will continue to make consecutive higher highs and higher lows. Each price high is higher than the previous high - higher high , and each low is higher than the previous low - higher low.

Commodity Trading Up commodities trading trend-lines gain more validity each time commodities trading price touches this upward commodity trend line but does not penetrate it. A commodity up trend remains in place until this sequence of higher highs and higher lows is broken.

A down-side penetration of an upward commodity trendline is a technical sell commodity signal, and usually the first indication that an upward commodity trend may soon end.

Drawing an Upward Commodities Trend Line

When the commodity market moves upwards it forms higher highs & higher lows forming a bullish market movement - Upward Commodities Trend. An upward commodity trend line can then be plotted by connecting these higher lows.

To draw this upward commodity trend line setup we use supports. To draw the upward commodity trend line correctly two support levels are needed. When commodities trading price touches the upward commodity trend line we buy and place stop loss commodity orders just a few pips below the upward commodity trend line. The diagram below shows an example of an upward commodity trend line.

The commodity upwards trend line setup will show the general direction of the market as bullish therefore commodity traders will only open buy long commodities trades as long as commodities trading price is within this upward commodity trend bullish market setup and within the support areas. These support levels are the levels where if the commodity market retraces then these points will provide strong supports for the commodities trading price. This is why many commodity buyers will wait until commodities trading price retraces downward & hits these retracements levels market the upward commodity trend line to open buy commodities trades. Commodities trades opened at this support levels have a high Risk to Reward Ratio with minimum draw down.

In the above upward commodity trend line commodity setup the trader would have opened buy/long commodities trades from the signals generated at the support1, support2, support3 and these commodities trades would have made a lot of profits with minimum amount of draw-down/retracement.

Upward Commodities Trading Channel

An upward commodity channel is plotted by plotting a line that is parallel to the upwards commodity trend line & then adjusted to touch the tops boundary of the commodities trading price movement. This then forms an upward commodity channel and as long as the commodities price stays between these two trading channels the bullish market movement will continue moving up.

Trading The Commodity Trading Channel

This upward commodity channel is used by commodities traders to show levels where it is best to take profits. Commodities traders will take some profit once the commodities trading price touches the upper channel & wait for another retracement before opening a long buy commodities trading again.

MetaTrader 4 Tools For Drawing Commodities Trend Lines and Channels

The Commodity MT4 Trend Line Indicator drawing tools to draw these commodity trend lines and commodity channels setups on the MT4 are located on the MT4 drawing tool bar within the MT4 commodities trading platform, To get this MetaTrader 4 tool bar if it is not activated on your commodity platform, Click in 'View' Next to the 'File' menu at top left corner of the MT4 commodities platform & click View, Then Click on Toolbars, Then Check the 'Lines Tool-bar' by clicking on it.

Below is the screenshot Image of the MT4 drawing tool bar. To draw a commodity trendline on a commodity chart just click on this MT4 commodity trendline drawing tool and select the point where you want to draw the commodity trend line.

This is one of the learn commodity technical analysis lesson among the many learn commodity tutorials on this website located on the side navigation menu, where you will learn how to draw commodity trend lines and analyze these commodity trend lines setups.