How to draw reliable trend lines

A trend line is the humblest tool: one line, yet it clarifies whether the trend is still intact. The hard part isn't drawing it, it's drawing it objectively and using it sparingly.

The basic method

An uptrend connects successively higher lows; a downtrend connects lower highs. Two points draw a line, but a third touch is what truly confirms its validity — the more it's tested, the more it's worth.

Slope and validity

• A line that's too steep rarely holds and often breaks quickly;
• Connecting closing prices rather than wick tips is usually sturdier;
• Don't force it — if you can't draw a clean line, the trend itself isn't clear.

Break and retest

A decisive break of an uptrend line may signal weakening — but beware false breaks. The steady approach is to wait for a retest that holds, confirmed with volume and support/resistance. Two parallel trend lines make a "channel".