Trendline examples — draw your ownSample data · not a real stock
What to look forThe lows keep getting higher. A line joining those rising lows is an uptrend line.
CautionTrendlines differ by who draws them and which lows they pick. Price does not always bounce near the line.
1260 bars · 2018-10-29 – 2023-08-25
On price
Lower panes
Auto
0 lines drawn (this chart and interval). Choose a mode above to draw.
Sample (synthetic) data: not a real stock or real prices, but prices generated to explain the idea. Drag the chart to move through time and use the wheel or two fingers to zoom.
Concept
Prices go up and down every day, but over a few months a direction sometimes appears.
Uptrend: both highs and lows keep rising. A line joining the rising lows is an uptrend line.
Downtrend: both highs and lows keep falling. A line joining the falling highs is a downtrend line.
Sideways: highs and lows repeat at similar levels. Here support and resistance (next step) fit better than trendlines.
In the chart above, choose Draw trendline and click two lows in turn. Your lines appear as solid orange lines; automatically found trendlines are dashed. Turn the automatic display on and off to compare it with your own line.
How to draw a trendline
Look at a wide view and find two or more clear lows (uptrend) or highs (downtrend).
Draw a line from the first point to the second and extend it to the right.
Check that the price did not cut far through the line in between. If it did, choosing other points is more natural.
If a third point touches the line, people often say many traders are watching the same line.
Trendline value = first price + (second price − first price) × (bars elapsed ÷ bars between the two points)
This site’s automatic trendline joins the two most recent “swing lows (highs)” — lower (higher) than the five bars on each side — where the lows rise (for an uptrend) and no low in between falls below the line. A close more than 1% beyond the line is marked as a “trendline break”.
Cautions when reading it
No single right line: the line depends on which lows you pick and whether you join bodies or wicks.
False breaks: prices often leave the line briefly and come right back. Check what happens after the break in the third example.
Points you only see later: a low is only known to be a low after the price rises from it. A line drawn on a past chart did not necessarily look that way in real time.
A trendline is a tool for organizing the trend, not a guarantee that the price will bounce when it touches the line.
Chart shapes and indicators summarize past prices. The same shape is sometimes right and sometimes wrong depending on the market, and this page does not tell you when to buy or sell any stock. To practice yourself, try the chart lab or mock trading.