A trendline is one of the most basic but established utility in charting. A break in trend caused by the penetration of the trendline results in either an actual trend reversal or a slowing in the pace of the trend. Although it is hard to know which alternatives will develop, there are three guidelines that can assist us in our evaluation.
-The length
The trend length is a crucial factor to take into consideration. A short length trendline occurring over 1-3 weeks are only of minor importance. If the trend extends over a longer period of 1 month to 36 months, its trend violation will signify a crucial juncture point. So by analogy, long trends equals big signal, short trend equal small signal.
-The number of times the trendline has been tested
A trendline is formed by a dynamic area of support and resistance. The more times the trend is ......