InvestorQ : How important is trend line analysis in technical charting?
Jignesh Gupta made post

How important is trend line analysis in technical charting?

Answer
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Maniish Lofar answered.
1 year ago


There are two basic things that you need to keep in mind. Firstly, using trend and trend line analysis is a very important aspect of technical analysis because it charts out the broad range you can trade and also defines when the trend is shifting decisively so that you can tweak your trading strategy accordingly. Secondly, you need to understand that in the field of stock market investing, trend analysis is only one of the many tools and techniques available. When a trend line is broken it should only serve as a warning that the trend may be changing. When a trend line is broken you should use additional tools and signals to confirm the change in trend. That is critical because unless you do that you are likely to get caught in false or deceptive trends which are also called trader booby traps.