How to Draw Trendlines Correctly
Trendlines are simple but powerful when drawn correctly. Most traders draw them wrong. Here's the right approach.
Technical Analysis · May 11, 2026 · 4 min read
A trendline connects two or more significant swing lows in an uptrend (or swing highs in a downtrend). When price touches a trendline a third time and holds, the line is validated. The more touches, the stronger the line — and the more significant the eventual break will be.
The Common Mistakes
The most common mistake is forcing a trendline to fit the chart — angling it to connect as many points as possible regardless of significance. A valid trendline should connect genuine swing points, not minor candle wicks. It's also better to draw trendlines through candle bodies rather than wick extremes, as bodies represent where the majority of activity occurred. Two confirmed points establish the line; three or more validate it.
Breaks and Retests
A trendline break — especially on elevated volume — signals a potential trend change. However, the most reliable trade is the retest: after breaking below a rising trendline, price often pulls back up to that former support (now acting as resistance) before continuing lower. This retest offers a lower-risk entry in the direction of the break, with a tight stop just above the trendline.
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