E-BOOK SERIES

C.H.A.P.T.E.R 3

Trendline Secrets:
Unlocking the Power
of Trading Trends

P D J V 3 - 2 2 2 2 2 3
PUTRI DHIA JOURNAL
I G : @ P U T R I D H I A J O U R N A L
 TABLE OF

2 0 2 3
P R I V A T E © C O P Y R I G H T
• What Are Trendlines? (Pg.2)

• Benefits Of Using Trendlines In Trading

(Pg.3)

• Importance Of Trendlines In Forex

Trading (Pg.4)

• Identifying And Drawing Trendlines

Accurately (Pg.5)

D H I A F A M
• Using Trendlines To Enter And Exit
Trades (Pg.6-14)

• Mistakes To Avoid When Using Trendlines

(Pg.15-16)

• Chapter Summary (Pg.17)

1
 WHAT ARE TRENDLINES?
D H I A F A M

Trendlines are lines drawn on a

chart that connect two or more
price points. These lines are used
to identify the general direction
of the trend in the market. There
are two types of trendlines:
P R I V A T E © C O P Y R I G H T

uptrend lines and downtrend

lines.

An uptrend line is drawn by

connecting two or more higher
lows, with the line sloping
upward. This indicates that the
market is trending higher, with
buyers in control. A downtrend
line is drawn by connecting two or
more lower highs, with the line
sloping downward. This indicates
that the market is trending lower,
2 0 2 3

with sellers in control.

2
 BENEFITS OF USING
TRENDLINES IN TRADING

There are several benefits of

2 0 2 3
using trendlines in Forex
trading. Here are some of
the main benefits:

P R I V A T E © C O P Y R I G H T
• Trendlines help traders
identify the direction of
the trend, which is
essential for making
informed trading
decisions.

• Trendlines can help

traders identify key levels
of support and resistance,
which can be used to enter
or exit a trade.

D H I A F A M
• Trendlines are easy to use
and can be drawn on any
charting platform.

• Trendlines can be used in

combination with other
technical tools to create a
more robust trading
strategy.

3
 IMPORTANCE OF TRENDLINES
IN FOREX TRADING
CURRENCY PAIRS
D H I A F A M

Trendlines are an essential tool

for Forex traders because they
help traders identify the direction
of the trend. Knowing the
direction of the trend is important
P R I V A T E © C O P Y R I G H T

because it helps traders make

more informed trading decisions.
For example, if the trend is up,
traders should look for buying
opportunities, while if the trend is
down, traders should look for
selling opportunities.

In addition, trendlines can help

traders identify key levels of
support and resistance. Support is
the price level at which buyers are
willing to enter the market and
2 0 2 3

prevent prices from falling

further. Resistance is the price
level at which sellers are willing
to enter the market and prevent
prices from rising further. By
identifying these levels, traders
can make more informed decisions
about where to enter or exit a
trade.

4
IDENTIFYING AND DRAWING
TRENDLINES ACCURATELY

One of the most important

things to know when using
trendlines is how to draw
them accurately. Here are

2 0 2 3
some tips for drawing
trendlines:

• Start with higher

P R I V A T E © C O P Y R I G H T
timeframe: To identify the
general direction of the
trend, start with the
monthly, weekly or daily
timeframe. Look for two or
more swing highs or swing
lows to connect with the
trendline.

• Use the line chart: To

draw trendlines
accurately, use the line
chart instead of the

D H I A F A M
candlestick chart. This will
help you see the trendline
more clearly.

• Draw the line through the

body of the candle: When
drawing a trendline, make
sure it touches the body of
the candle, not just the
wicks. This will help you
identify the most
important levels of
support and resistance.

5
 USING TRENDLINES TO
ENTER AND EXIT TRADES

Trendlines can be used in a

variety of ways to enter and exit
trades. Here are some strategies
for using trendlines:
D H I A F A M

• Bounce Trendline: Another way

to use trendlines is to trade
the bounces off the trendline.
When the price touches the
trendline, it may bounce off
P R I V A T E © C O P Y R I G H T

and continue in the direction

of the trend. Traders can use
this as a signal to enter a
trade.

• Breakout Trendline: One of the

most popular ways to use
trendlines is to trade the
break of the trendline. When
the price breaks through the
trendline, it signals a
potential trend reversal.
Traders can use this as a
signal to enter or exit a trade.
2 0 2 3

• Trendline Channels: Trendlines

can also be used to identify
channels. Channels are created
when the price moves between
two parallel trendlines.
Traders can use these channels
to identify potential entry and
exit points.

6
 Bounce Trendline Breakout Trendline
(Support) (Resistance)

2
D H I A F A M

3 – ENTRY BUY 3 – ENTRY BUY WHEN

TRENDLINE BREAKS
2 AND PRICE RETRACED
P R I V A T E © C O P Y R I G H T

BACK TO TRENDLINE
1

Diagram 1: Bounce Trendline (S) Diagram 2: Breakout Trendline (R)

Bounce Trendline Breakout Trendline

(Resistance) (Support)
1
2 0 2 3

3 – ENTRY SELL
3 – ENTRY SELL WHEN
TRENDLINE BREAKS
AND PRICE RETRACED
BACK TO TRENDLINE
2

7
Diagram 3: Bounce Trendline (R) Diagram 4: Breakout Trendline (S)
 CURRENCY PAIRS
D H I A F A M
P R I V A T E © C O P Y R I G H T
2 0 2 3

Diagram 5: Example of Bounce Trendline

(Resistance)

8
 CURRENCY PAIRS
D H I A F A M
P R I V A T E © C O P Y R I G H T
2 0 2 3

Diagram 6: Example of Bounce Trendline (Support)

9
 CURRENCY PAIRS
D H I A F A M
P R I V A T E © C O P Y R I G H T
2 0 2 3

Diagram 7: Example of Breakout Trendline

(Resistance)

10
 CURRENCY PAIRS
D H I A F A M
P R I V A T E © C O P Y R I G H T
2 0 2 3

Diagram 8: Example of Breakout Trendline

(Support)

11
 Trendline Channel
(Uptrend)
D H I A F A M

SELL WHEN
CHANNEL BREAKS
P R I V A T E © C O P Y R I G H T

Diagram 9: Trendline Channel (Uptrend)

Trendline Channel
(Downtrend)
2 0 2 3

BUY WHEN
CHANNEL BREAKS

12
Diagram 10: Trendline Channel (Downtrend)
 CURRENCY PAIRS
D H I A F A M
P R I V A T E © C O P Y R I G H T
2 0 2 3

Diagram 11: Example of Trendline Channel

(Uptrend)

13
 CURRENCY PAIRS
D H I A F A M
P R I V A T E © C O P Y R I G H T
2 0 2 3

Diagram 12: Example of Trendline Channel

(Downtrend)

14
 MISTAKES TO AVOID
WHEN USING TRENDLINES
(CONT’D)

• Ignoring the larger trend:

It's easy to get caught up in
short-term trends and
forget about the larger

2 0 2 3
picture. Always keep the
larger trend in mind when
using trendlines to make
trading decisions.

P R I V A T E © C O P Y R I G H T
• Relying solely on
trendlines: While trendlines
can be a powerful tool in
Forex trading, they should
never be used as the sole
basis for making trading
decisions. Always use
trendlines in combination
with other technical
indicators and fundamental
analysis.

D H I A F A M
• Failing to adjust trendlines
as the market changes:
Markets are always
evolving, and trends can
change quickly. Failing to
adjust your trendlines as
the market changes can lead
to missed opportunities or
even losses. Always be
ready to adjust your
trendlines as the market
evolves.

15
 MISTAKES TO AVOID
WHEN USING TRENDLINES

• Drawing trendlines that don't

fit the market: It's important
D H I A F A M

to remember that trendlines are

only as good as the data you
use to draw them. If you force a
trendline to fit a market that
isn't trending, you may end up
making poor trading decisions.
P R I V A T E © C O P Y R I G H T

Always double-check that your

trendline fits the market before
using it to make trades.

• Drawing trendlines with too

few or too many data points:
Drawing trendlines with too few
or too many data points can
lead to false signals and missed
opportunities. When drawing a
trendline, make sure you have
at least two or three data
points to confirm the trend.
2 0 2 3

• Ignoring the larger trend: It's

easy to get caught up in short-
term trends and forget about
the larger picture. Always keep
the larger trend in mind when
using trendlines to make
trading decisions.

16
 CHAPTER SUMMARY

In conclusion, mastering
trendlines is a crucial
D H I A F A M

aspect of Forex trading. It

helps traders to identify
market trends and make
better trading decisions.

By understanding the
P R I V A T E © C O P Y R I G H T

concepts and techniques

outlined in this Ebook,
you will be better
equipped to use trendlines
effectively and improve
your overall trading
performance.

In the next Dhiafam

Private Ebook Series, we
will dive explore the
knowledge of fundamental
analysis in trading. Be
2 0 2 3

sure to stay subscribed to

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Until next time traders!

-Dhia

17
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