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Thread: TRADING WITH AUTO TRENDLINE INDICATOR

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    Default TRADING WITH AUTO TRENDLINE INDICATOR

    The Automatic Trendline Indicator plots trendlines automatically, saving you the time and effort of manually drawing trendlines every day. You can use this indicator with any trading strategy, indicator, or technical instrument to improve trading results because these trendlines represent future references to support/resistance.

    For traders who are new to the market, the Automatic Trendline Indicator is an excellent choice. Furthermore, this indicator is compatible with all types of timeframe charts and can be used to trade all types of forex currency pairs in the MT4 terminal.

    The Automatic Trendline Indicator for MetaTrader 4 (MT4) places trendlines on the trading chart automatically. With the help of this tool, you won’t have to worry about manually drawing trendlines every day. Everything can be completed with a single mouse click. These trendlines show future lines of support and resistance, so you can easily incorporate this indicator into your favorite trading strategy, indicator, or other technical tool to boost your trading efficiency.

    The Automatic Trendline Indicator is an excellent choice for new traders because it can be used to trade a wide range of financial markets, currency pairs, and forex currencies. It also works well in the MetaTrader 4 terminal with any timeframe chart.

    The Tend Line Plotter is an indicator that can be traded on the MetaTrader 4 trading platform. The metric will draw trend lines on the graph, beginning at the tops and ending at the bottoms. The indicator will work in any time frame and with any symbol and currency.

    The indicator has two different draw modes that allow for fully automated drawing. After each current candlestick close, the indicator will also check if any trendlines have been broken.

    There are only a few options for modifying the indicator’s behavior:

    • MaxBarsBack: This parameter determines the candlestick range in which trendlines can be drawn.
    • SwingMode: Sets the trendline draw mode to Close/Close or High/Low. • DrawHLines: If True, it draws horizontal trendlines on any top or bottom.
    • DrawCopyLines: If True, a dotted parallel trendline is drawn on the bottom/top of the chart.
    • CopyLineStyle: Modifies the trend channel channel’s copied trendline style (default is Dot)
    • CopyLineWidth: This property determines the width of the copied trend line in the trend channel (default is 1)
    • CountBarsTo: Determines the most recent candlestick/bar from which trendlines should be drawn (default is bar [2] minimum value is 0)

    The resulting line is then used to give the trader a good idea of which way the value of an investment might move.

    A trendline is a line drawn over the pivot highs or below the pivot lows to show the current price direction. They show price direction and speed, as well as describing patterns during price contractions.

    What do the Trendline say to you?

    The trendline is one of the most important tools that technical analysts use. Rather than looking at past business performance or other fundamentals, technical analysts look for patterns in price action. A trendline can be used by technical analysts to determine the current direction of market prices. The trend, according to technical analysts, is your friend, and identifying this trend is the first step in making a good trade.

    To draw a trendline on a price chart, an analyst must have a minimum of two points. Some analysts work in different time frames, such as one minute or five minutes. Others prefer to look at weekly or daily charts. Some analysts choose to view trends using tick intervals rather than time intervals, putting time aside completely.

    The analyst must plot three points on a chart, beginning at $35, moving to $40, and finally to $45

    When the analyst draws a line between all three price points, it indicates that they are on an upward trend. Because the drawn trendline has a positive slope, it instructs the analyst to buy in the trend’s direction. If the price of company A falls from $35 to $25, however, the trendline has a negative slope, and the analyst should sell in the trend’s direction.

    What is the difference between Trendlines and Channels?

    A chart can have multiple trendlines applied to it. Traders frequently use a trendline to connect highs and lows over a period of time in order to create channels. A channel introduces a visual representation of both support and resistance for the time period under consideration. Traders are looking for a spike or breakout, similar to a single trendline, to pull the price out of the channel. They may use that breach as an exit point or an entry point, depending on how they establish their trade.

    The Constraints of a Trendline

    Trendlines, like all charting tools, are limited by the fact that they must be re-adjusted as more price data is received. A trendline can last for a long time, but eventually the price action will deviate enough that it needs to be updated. Furthermore, traders frequently connect to various data points. Some traders, for example, will use the lowest lows, while others will only use the lowest closing prices for a limited time. Finally, trendlines applied on smaller timeframes can be sensitive to volume. A trendline formed on low volume can easily be broken as volume increases throughout the session.

    What exactly is an Auto Trendline?

    The current up and down trend line is determined and drawn by the automatic trend line indicator. Trend lines can also be drawn manually using the drawing tool on the charting toolbar, but this indicator does so automatically. The user specifies the number of periods to “look back” from the present in order to determine where the trend lines should be placed.

    The down trend line connects the period’s highest high to the next highest high prior to the lowest low for which the down trend line has not been penetrated. The user can choose the colors and whether or not the up, down, or both trends should be drawn. Depending on the historical pricing of a particular issue, there may not be a valid up or down trend for the specified user period in some cases. This indicator can be applied to the same chart window multiple times. You could, for example, add auto trend lines for periods of 500, 250, and 60 in a daily chart to see long-term, intermediate-term, and short-term trends in your charts. Auto trend lines are especially beneficial in slide shows. As the slide show progresses from one issue to the next, the current trend lines for the problems are calculated and drawn automatically. This is not possible using manually drawn trend lines.

    Trend lines are useful for identifying and confirming trends. A trend line is a line drawn on a chart that connects at least two price points and is usually extended forward to identify sloped support and resistance levels. Price action is supported by lines with a positive slope, indicating that net demand is increasing. As long as the price action remains above this line, we have a bullish bias. Lines with a negative slope that act as price resistance indicate that net supply is increasing. As long as the price action remains below this line, we have a bearish bias.

    Price will usually test a sloped trend line several times until a trend reversal occurs, at which point it will break. A trend line’s strength is proportional to the number of connecting points it has. Different approaches have different rules for how far connected price points can be apart and whether or not wicks or candle bodies can be linked, but all trend lines eventually break. It’s also possible to use this tool to visualize trends in indicators.

    What is an Auto Trendline Indicator

    AutoTrendLines is a MetaTrader 4 indicator that automatically detects and plots the most accurate trend lines on the chart.

    If you use trend lines frequently in your daily trading, the indicator provided will make it much easier to work with them and eliminate the need to manually spot and draw the lines every time.

    The indicator only displays the most accurate trend lines. As a result, the line will be removed from the chart if its interaction with the price is no longer expected.

    It does not redraw the indicator, but it can change the angle of the lines when new extremes occur. It’s ideal for intraday and intermediate-term Forex trading.

    Working with it during M15-H1 is the best timeframe.

    The Automatic Trendline Indicator is explained in detail.

    By automatically connecting the market’s highs and lows, this indicator plots trendlines. The market’s levels of support are represented by the blue trendline beneath the bar, while the market’s levels of resistance are represented by the red trendline. For long entries, look for bullish pin-bars/candles at the support levels, and for short entries, look for bearish bars closed right below the resistance levels. This is a bit of a challenge at first, but once you understand the candlestick patterns, things will become much easier. This indicator is a good fit for any trend-following forex trading strategy as a trendline indicator.

    What is the Automatic Trendline Indicator and how does it work with it?

    The Automatic Trendline Indicator traces the trendlines by connecting the highs and lows of market prices.

    For purchase orders, look for bullish pin-bars/candles at the support levels, and for sale orders, look for bearish bars closed right below the resistance levels. This may appear confusing at first, but once you become familiar with the price action and candlestick patterns, things will become much smoother and cleaner with the Automatic Trendline Indicator.

    As a trendline indicator, this auto trendline indicator is a great complement to any trend-following forex trading strategy.

    Who should this indicator be used for?

    Because Trend Lines (TL) are a fundamental tool for analysis, they can be used with any trading or indicator system.

    If you’re a beginner trader, this indicator will help you understand what a trend line is. Additionally, while watching the indicator in action, you’ll learn how to draw trend lines on your own.

    The techniques listed below will assist you in learning how to analyze trend lines and apply them in practice.

    For experienced traders, the indicator will suggest trend line options and save them a lot of time when setting them up.

    Techniques for Drawing with Trend Lines

    Initially, the indicator searches the chart for all possible trend lines. Then, using a few crude filters, it will eliminate more than half of the lines discovered. The quality of the remaining ones is then assessed, and the graph’s two best trend lines are displayed.

    As a result, there can only be two lines on the chart at the same time:

    • Uptrending line (blue);
    • Downtrending line (orange).

    Projection of the Trend

    After you install the indicator, you’ll notice that trend lines are divided into two types: solid and dotted lines.

    The indicator was able to determine the trend line, which is shown as a solid line.

    The dotted line indicates the suggested trend continuation as well as the area of potential price-trend line interactions.



    As you can see in the image above, the indicator accurately distinguishes between true and false breakouts.

    What is the best way to trade with the Trendlines Indicator?

    Many trend line trading methods can be divided into two categories:

    • Breakout of the trend line;
    • Price bounce from the trend line (reversal);
    • Trend lines are rarely used as price movement vectors.

    Trading Rules with an Automatic Trendline Indicator

    Buy Entry


    • A bullish bar forms just above the resistance-trendline.
    • Purchase triggers are activated when the corresponding bullish bar’s high is broken.
    • Place stop losses below the area of support, and exit long/take profit when the price reaches the upper trendline.

    Sell Entry

    • A bearish bar is forming just beneath the resistance/upper trendline.
    • The low bearish bar of the respective bar is broken, triggering a sell trigger.
    • Place your loss of stop order above the resistance zone.
    • TL’s Price Bounce
    • Exit short/take profit whenever the lower trendline reaches the price

    You’ve probably heard that trading with the trend is the most profitable strategy. This is due to the fact that trend movement tends to follow the asset price, whereas reversals are less likely.

    Based on the logic outlined above, it is best to open a trade the next time the price touches the trend line. You’ll get the best reward-to-risk ratio as well as a potentially profitable trade if you do it this way.

    “As a result, the “Price bounce from TL” strategy entails the following:

    • purchase if the price has approached or touched the uptrend line;
    • Sell if the price has approached or touched the downtrend line.



    To demonstrate the logic behind placing Stop Loss orders, consider the market situation depicted in the diagram above:

    To avoid being triggered by a false breakout, it is recommended that the Stop Loss order be placed a sufficient number of points below the previous low.

    Take Profit can be placed anywhere within the range of the corresponding trend line (TP1) or at a distance equal to the previous wave’s height at the highest price level (TP2).
    The logic behind selling transactions is the polar opposite.

    We previously discussed how to properly place Stop Loss and Take Profit orders regardless of the strategy chosen.

    How to use Trendlines in your Trading

    When used correctly, trendlines are an excellent tool for traders, and they are an important part of learning technical analysis and trading off charts. When used incorrectly, however, they become ineffective and even counterproductive.

    This could lead to the mistaken belief that prices have reversed or that a trend is strong when the price action indicates otherwise. The following suggestions may assist you in making effective use of trendlines as part of your trading strategy.

    The Tool’s Base Concepts

    Trendlines draw attention to a specific pattern or range (sideways movement). From the lowest point of the downward motion to the highest point of the upward motion, a trendline connects a low swing to a high swing. When the price rises, the trend line rises in lockstep with it.

    See also: Wide range of InstaForex technical indicators.

    An upward trendline is created by connecting these lows with a line, indicating that prices are rising. A trendline can be drawn along the individual swing highs as well. This shows the angle of ascent, the strength of the price movement, and the trend’s relative strength.

    When the price drops, the swing’s highs drop as well. A downward trendline is created by connecting these highs to a line, illustrating the downward trend. It’s also possible to draw a trendline between the swing lows. This shows the strength of the downward price movement as well as the angle of descent.

    Numerous Trendlines

    In most cases, more than one trendline would be present in a game. At any given time, you could draw multiple trendlines, each illustrating price movement over different time periods.

    At very steep angles, trendlines typically have a short life because prices cannot sustain a near-vertical increase or fall for an extended period of time.

    Drawing trendlines, on the other hand, can assist new traders in identifying the overall trend while also highlighting small trends and corrections within that overall trend.

    Buying or going long opportunities may arise during an uptrend when a short-term downtrend crosses the overall ascending trendline. During a downtrend, selling or shorting opportunities may arise when a short-term uptrend crosses the overall descending trendline.

    Adjustment of the Trendlines

    After being drawn, trendlines are frequently adjusted. Prices do not move in a predictable pattern, and they move along both the price and time axes, because trendlines account for both time and price.

    This means that any trend acceleration or deceleration will necessitate changes to the trendline. Trendlines are meant to be used as a tool, not as a sole source of information. To determine whether a trendline should be adjusted or if it has been definitively broken, consider how the price moves within the trend.

    During an upward trend, the price produces higher highs and lower lows. If the price moves below the trendline, it does not necessarily mean that the trend has ended; it may simply be necessary to adjust the line as long as this occurs.

    During a downtrend, the price creates lower lows and higher highs. If the price moves above the downward trendline while this is happening, it does not necessarily mean that the trend has ended; it may simply mean that the trendline needs to be adjusted.

    Trendline as a Reference

    The requirement for constant adjustment makes a trendline imprecise for use as a trade signal. Consider that a trendline drawn at a slightly different angle can have a significant impact on the price at which the trendline intersects.

    As a result, while trendlines can be used as a guide, more precise criteria, such as a move back in the direction of the trend, an engulfing pattern (where the next bar is larger than the previous one, engulfing it), or an indicator that adapts to changes in volatility more accurately and quickly, should be used to enter a trade.

    If you just want to use trendlines as a guide, you don’t have to worry about drawing them along the exact highs and lows.

    Drawing trendlines along extreme highs and lows works in some cases, but when it doesn’t, draw the trendlines that are the best fit. Because the trendline isn’t used as a trade signal, it still gives you relevant trend information without requiring you to re-adjust it all the time.

    An Example of How to use a Trendline

    Using trendlines is a relatively simple process. A trader only needs to graph the price data normally by using open, close, high, and low. The information for the Russell 2000 is shown below in a candlestick chart with the trendline applied to three session lows over a two-month period.

    When entering a position in the Russell 2000, the trendline shows the upward trend and can be used as support. In this case, the trader has the option of entering a long position near the trendline and then extending it into the future. The trader can use price action on the downside to breach the trendline as a signal to close the position. This allows the trader to exit when the trend they are following begins to weaken.

    The trendlines, of course, are a function of the time period. A trader does not need to redraw the trendline very frequently in the example above. On a minute-by-minute basis, however, trendlines and trades may need to be re-adjusted frequently.

    Breakout from the TL

    They will eventually defy all trend lines. Traders, however, do not miss out on the opportunity to profit even in this situation. As a result, when the trend line breaks out, there is a trading strategy in place.

    The market’s entry requirements are as follows:

    If the downtrend line has been broken and the price has settled above it, you should consider buying it if the price also touches the line from the other side again.

    If the upward trend line has been broken and the price has settled below it, you should sell if the price from the opposite side also touches the line.

    The logic behind placing Stop Loss orders is similar in both strategies. Consider the following scenario based on the Buy Trade:

    • The Stop Loss order should be placed below the lowest price level within the trend line’s scope of consideration.
    • The Take Profit order should be placed at the highest price level achieved at the time of the trend line’s breakout.



    In the same way, trade sales can be approached in the opposite way.

    Setting for the Indicator

    Because of a successful algorithm, trend lines can be identified fairly accurately. As a result, we’ve only added one new option: the depth of the analyzed price history.

    Trend’s Timeframe:

    • 300 candles;
    • 600 candles in the middle;
    • 1200 candles in the long.

    The color of the lines is automatically adjusted to match the chart’s background color.

    The length of the projected trend line in bars is called the projection length.

    Normal Scale or Log?

    The question of whether trendlines should be drawn on log scale or normal scale charts has sparked a lot of debate on the Chart Forum over the years.

    The case for the log scale has been summarized by Alsoran as follows:

    Brokers and analysts plot data in log mode. They provide advice to institutional customers whose order flow has a significant influence on the trend and price action. Price breaks and rejections on key trendlines and channels have a significant impact on their recommendations. These are all based on logarithmic graphs. As a result, logarithmic trendlines have a higher significance.

    The argument for scale trendlines that are normal (linear):

    • The majority of trade authors, including Stan Weinstein, Alexander Elder, Chris Tate, and Daryl Guppy, use linear charts. Whether or not most analysts and brokers use log scale graphs is debatable. Several trading writers, including Stan Weinstein and Chris Tate, are former analysts or brokers who use linear charts.
    • In my opinion, the two parties are talking about different time frames!

    Normal Scale

    Price is plotted against time in standard scale graphs. A car’s speed would be graphed in a similar way: distance (y) over time (x). If a car is traveling at a constant speed, the graph will be a straight line. If the line is stopped, it will become horizontal. When you accelerate, a curve appears on the graph.

    Log Scale

    The purpose of log charts is to measure acceleration, or the rate of increase in stock prices, rather than velocity. A constant velocity will be represented as a flattening curve, while a constant rate of growth (acceleration) will be represented as a straight line.

    In the short term

    In the short/medium term, we concentrate on velocity: “Is this week’s price increase as good as last week?” The time period is far too short to be concerned with compound growth rates.

    In the long run

    The vast majority of institutions invest in long-term stocks and are unconcerned about short-term price fluctuations. They’re looking for the year’s compound growth rate, which isn’t the same thing as short-term velocity.

    Should I use a different scale for the graph?

    On short- and medium-term graphs, we recommend that you use standard scales (3 years or less).

    I prefer to draw trendlines on linear charts unless we are looking at a time period of 10 or 20 years.

    Trading Signal Indicators

    Breaks in the trendline indicate a shift in momentum; however, a shift in trend does not always imply a shift in direction. Although trendline breaks appear to be obvious in retrospect, you’ll usually find that the trendline shown was not the first to be drawn: several trendlines may be broken before a trend reversal.

    When is it appropriate to act on Trendline breaks?

    • When trading short-term or swing trading, act on trendline breaks when you receive price confirmation (or confirmation from another indicator), just as you would with any other momentum indicator.
    • In the long run, trendlines are an effective tool for exiting trends that have reached a point of no return (or down-trends that have spiked into a cathartic sell-off).

    Blow-offs

    A rapid accelerating trend, or blow-off, is usually identified by at least three accelerating trendlines, each with a significantly steeper gradient than the previous one. In 1999/2000, Yahoo provided an excellent example.

    Long-term breaks should be normal.

    Normal trendline breaks on long-term charts should be treated as an alert rather than a signal of a trend reversal.

    Price tests support $8.00 several times before resuming the up-trend, establishing a second trendline at
    1. The first trendline drawn after an inverted head and shoulders is broken at, indicating a slowing of momentum;
    2. Price tests support $8.00 several times before resuming the up-trend, establishing a second trendline at
    3. If the upward trend continues, a third trendline can be drawn through the lows of $8.00 and $14.00.

    Useful hints include:

    Trendlines displayed by the “AutoTrendline” indicator can be traded in a variety of ways. If you break the trendline above or below, for example, you might want to try a breakout strategy.

    Furthermore, prices frequently bounce back after touching the trend line. Aiming higher and considering purchasing could be beneficial in this situation.

    How do you install the Auto Trendline indicator on your Metatrader 4 trading platform?

    • Click the ‘LINK’ button at the bottom of this post to download the indicator.
    • Copy and paste the Automatic Trendline Indicator’s files into the Metatrader 4 platform’s following folder: Indicators are part of the MQL4 language.
    • As a result, you’ll be able to access folders like this: MQL4 > Indicators > File > Open Data Folder > MQL4 > Indicators (paste files here).
    • Open Metatrader 4 and restart your client.
    • Choose the chart and timeframe for which you want to evaluate the indicator.
    • Look for Custom Indicators in your Metatrader 4 platform’s Navigator, which is located on the left side of the screen.
    • With the right mouse button, select automatic-trendlines.mq4 and then select “Attach to the chart.”
    • If necessary, make changes to your settings and then click OK.
    • The indicator appears to be ready to use on the chart.

    Final Thoughts

    Trendlines are an excellent tool for displaying short-term changes within a larger trend. Pay attention to price action and take it into account when using trendlines. Even if the price moves above a downward trendline, it is still in a downward trend if lower lows and lower highs are created.

    Even if the price moves below the trendline, it still has an uptrend when it makes higher highs and lower lows.

    A trendline must be adjusted frequently, especially when trading on a daily basis. Use “best-fit trendlines” to avoid constant readjusting. The best fit trendline still depicts the pattern, as well as when it may be reversing.

    Use trendlines and price action signals to alert you to potential trade opportunities (taking action on trades simply by the price).

    In fact, trendlines can be applied in a variety of ways. They can be used to judge trends as well as to place stop-loss orders. It’s also a good idea to experiment with your own trendline drawing methods after checking them with this “AutoTrendline” drawing indicator.

    Though trading on financial markets involves high risk, it can still generate extra income in case you apply the right approach. By choosing a reliable broker such as InstaForex you get access to the international financial markets and open your way towards financial independence. You can sign up here.


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    This post is sponsored by a content payout program available to anyone to participate.
    AutoTrendLines is a marker for MT4 that recognizes the most accurate pattern lines and naturally plots them on the outline.

    In the event that you regularly depend on pattern lines in your day by day exchanging, the given pointer will make it a lot simpler to work with them and diminish you of the need to spot and physically draw the lines without fail.

    The marker shows just the most real pattern lines. Consequently, the line will be taken out from the diagram if its communication with the cost is not, at this point anticipated.

    The pointer doesn't redraw, however it can change the point of the lines when new limits happen. It is most appropriate for intraday and mid-term Forex exchanging.

    Though trading on financial markets involves high risk, it can still generate extra income in case you apply the right approach. By choosing a reliable broker such as InstaForex you get access to the international financial markets and open your way towards financial independence. You can sign up here.


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