How to Use Trendlines in Your Trading (part1)

Trendlines are a key part of delving into technical analysis and trading off of charts. When used correctly, they're a helpful, clear, and relatively simple tool for traders. Used improperly, however, trendlines become ineffective and even counterproductive. Knowing how to use trendlines can be the difference between winning and losing trades.
Keep reading to learn some tips that can help you effectively use trendlines as part of your trading strategy.

The Basics of Trendlines

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Trendlines are simply diagonal lines that highlight a trend or price range. These lines follow the price movement in an attempt to give traders a general sense of how high or low the price might go in a given timeframe. When the price rises, the trendline rises accordingly. When the price falls, the trendline falls.
When prices are rising, connecting the lows with a line results in an ascending trendline—an "uptrend." A trendline can also be drawn along the highs of the trend. This shows the angle of ascent, the strength of the price move, and the relative strength of the trend.
When the price falls, the highs fall. Connecting these falling highs results in a descending trendline—a "downtrend." A trendline can also be drawn along the lows to highlight the angle of descent​ and the strength of the downward price movement.

Using Multiple Trendlines

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Typically, you would have more than just one trendline in play. At any given moment you could draw many trendlines, all showing the price movement over various periods of time. 
Trendlines at steep angles typically have short lives, since prices cannot sustain a near-vertical rise or fall for long. Shallower trendlines are more stable and easier to maintain.
Drawing trendlines whenever possible and on multiple time frames can aid new traders in spotting the overall trend, small trends, and corrections within those small trends.
During an uptrend, opportunities to buy or go long may occur when a short-term downtrend meets the overall ascending trendline. During a downtrend, selling or shorting opportunities may occur when a short-term uptrend meets the overall descending trendline.