Decoding Price Movement Slope or Trend line Slope


                 Trend lines are very easy to draw. We can draw as much trend line in a stock chart. some of them are useful for understanding Long term Price movement or price, It some of them useful for finding support and resistance. Some of them are useful for change in Price Movement and it's strength. In this article we are decoding what We can Understand from a Trend line Slope.

                  We can identify potential target for a stock by using trendline slope especially in day trading. we will learn this later. First we try to decode trendline slope here Price upward movement slope. What information we get from trendline slope and how can use that information in tading. 
  • Slope of a Price Movement determines the direction of Price Movement
  • Slope of a Price Movement determines How Much Time it will take to reach it's target price.
  • Slope of a Price Movement determines How Much (long) price moves in a day, weak, Month... etc
  • Slope of a Price Movement determines the Demand and the Supply of a Stock.

Determine Current Trend

              Above is Stock price chart in that price is moving upward direction. The price start is move to upward direction from after 10:00 AM. Before that, the price was very slowly moving downwards.
After 10 AM Demand of the stock was suddenly rose and price starts move upside little sharply.

Determine How Much time it take to reach a Particular Price Level

               We saw that the price started up move after 10 AM. Look at Price Ms ovement from 10:30 AM to 11:00 PM. Price moved from 104-105 levels to 110-112 level within 30 Minute. IE. It only took 30 Minute for 5-7 Price change.
Currently stock is trading at above 115 level (117-118 level). And Time is near 11:30.With this information, we can calculate how much the price can be moved within next 1 hour. or we can predict how much time will it take price to reach RS 130 level. Price has strength to move to rs 130 price level within an hour (12:30PM).
Like above. The slope of a price movement can be used to predict how much a stock can move in an hour, in a day, in a week... etc.

Strength of a Price Move.and Demand and Supply

             The slope of price movement trend line implies the strength of a price move. IE. If a trend line has a high degree of slope, We can assume that the Demand or Supply is high in that stock at that time. Likewise If a trend line has only low degree of slope, The demand or supply of a stock is very low.

Demand > Supply = Price move upward
Supply > Demand = Price move to downside

Capability to Break Resistance or Support


The slope of trend line indicate the capability of a price move to break the Resistance or Support Level. If a price move very sharply, it has strength to break the resistance or support. Likewise, If a price move to a direction very little slope, it has not enough strength to break support or resistance.

Gaining or Weakening Momentum


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