How to Use Indices Trend Line Signals for Entry Trading Signals, Exit Trading Signals and Setting Stop Loss Indices Order Levels

Indices Trend Indicator MetaTrader 4

How to Use Indices Trend Lines to Set Entry, Exit and Setting Stop Loss Indices Orders:

Indices Trend line trading method can be used to determine good entry and exit points for trades, protective stops are placed just below them.

The indices trend line bounce technical analysis strategy is a low-risk entry method used by stock indices traders to place entry trades after stock indices price has retraced.

Trades are setup along these indices trend line bounce levels and a stop losses placed just above the downward indices trend line for a downward indices trend or below the upward indices trend line in an upward indices trend.

The indices trend line break is a crucial indices trend reversal indicator of possible Indices Trading reversal trading signal. When the indices trend line is broken the stock indices price starts move in the opposite direction. This provides an early exit stock indices signal for traders to exit their open trades and take profits.

When there a penetration of these indices trend line levels, it is a signal that the stock indices price can start moving in the opposite direction.

Unlike other technical analysis indicators there is no formula used to calculate a indices trend line, this formation is just drawn between two chart points on a stock indices chart.

Technical Analysis Methods of Indices Trend Lines

The indices trend line bounce is a continuation stock indices signal where stock indices price bounces off this line to continue moving in the same direction as that of the indices trend. In a downward indices trend, the stock indices trading market will bounce downwards after hitting this indices trend line bounce level which is the resistance level. In an upward indices trend, the stock indices trading market will bounce upwards after hitting this indices trend line bounce level which is the support level.

The indices trend line break is a reversal stock indices signal where the stock indices trading market goes through the indices trend line and starts moving in the opposite direction. When a up indices trend is broken then the sentiment of the stock indices trading market reverses and becomes bearish and when a down indices trend is broken then the sentiment reverses and becomes bullish.

For very strong indices trends, after this indices trend line break signal, the stock indices price will consolidate for some time before moving in the opposite direction. For short term indices trends then this indices trend line break signal will mean stock indices price may reverse immediately.

In indices trading, both the indices trend line bounce and the indices trend line break that are used in technical analysis of stock indices charts are based upon these indices trend line levels being support and resistance levels.