Trendline
A straight line drawn through successive swing highs (downtrend) or swing lows (uptrend) to visualise the trend's slope.
A trendline connects at least two significant swing points in the same direction and projects the slope of the trend forward. Valid trendlines require a minimum of two anchor points; a third touch confirms it.
An ascending trendline acts as dynamic support in an uptrend; a descending trendline acts as dynamic resistance in a downtrend. Breaks of well-tested trendlines are watched as potential reversal signals — but need confirmation from volume and candle structure, not just a close below the line.
Example
QQQ makes swing lows at $430, $437, and $445 over eight weeks. A trendline connecting $430 and $437 extends to $445 — the third touch holds, confirming the ascending trendline. Traders buy near the line with stops just below it.
Related Terms
Channel
Two parallel trendlines containing price action — an upper resistance line and a lower support line defining the trend's corridor.
BeginnerDowntrend
A market structure defined by lower highs and lower lows, reflecting sustained selling pressure.
BeginnerSupport
A price level where buying pressure has historically halted or reversed a downward move.
BeginnerSwing Low
A candle or bar whose low is lower than both the preceding and the following candle's lows — a local price trough.
BeginnerTrend
The persistent directional bias of price over a defined timeframe — up, down, or sideways.
BeginnerUptrend
A market structure defined by a sequence of higher highs and higher lows, signalling persistent buying pressure.
Beginner