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com
BASIC CONCEPT OF TREND
There are three kind of trend in stock,forex or index :
- Up trend
- Down trend
- Sideways
UP TREND
Basic concept of up trend is HIGHER BOTTOM , see picture below
Bottom
Bottom
As you can see there is a higher bottom occured so we can call this up trend
pattern.
DOWN TREND
Basic concept of down trend is LOWER TOP , see picture below
Top
Top
You can see there is lower top occured so we can call this down trend pattern
SIDEWAYS
Sideways or flat pattern occured when price only move in a range of band ,in other
word price is in consolidation phase , for some trader this phase has critical
situation because it can trigger the trend , in this phase you did not know where the
price will go , yes in this phase better for you just sit and watch which range has
broken , see picture below
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If below range border was break then down trend will take a part and vice versa
NOTE :
Ussually Sideways pattern only occured in one time frame not the others time
frame , you can see sideways in 1H time frame but ussually it did not happen in 4H
time frame
TREND CHANGING
Trend changing signal can be happened if top or bottom was break !
Bottom was break !
Next ?? maybe downtrend
Top was break !
Next ?? maybe uptrend
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A higher then B , Next ?? usually downtrend
B
A
A lower then B,Next ?? usually uptrend
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ENTRY POINT AND STOP LOSS
- Determine the major trend from daily or 4H chart
- Look at 30 M or 1H chart and determine the trend on that time frame
(minor trend)
- If major trend is up then look at minor trend and wait for bottom happened
- BUY when bottom of minor trend happened
- Place your Stop Loss at bottom of major trend , if SL too big you can place
it at bottom of minor trend
- Exit according to your target or if you feel it’s enough
Bottom 4H
A
4H Uptrend
BUY !
C
B
A Stop Loss
30M/1H Up trend pattern , take BUY position with Stop Loss at bottom
4H (A)
Forex Indicators Collection for MT4 can be found here :
http://forex-indicators.freefxsystem.com
Safe Trading !
Prasxz Copyright December 2007
PS: I’m forex trader with experience more than 2 years and still developing my
own forex system based on zig zag indicator.
