A lot of people have asked me how to draw a trendline through the past years, also sharing their concern about lack of proper knowledge about such an well-known phenomenon like trendlines. So I decided to discuss a set of principles in this thread that was how-to with focus on identifiion that was correct.

Criteria identifiion
Any trendline ought to be drawn through/connecting at 3 extreme points in your chart with no intersection to another side, not even by 1 pip. This goes for many time-frames but anticipate a follow-through that is larger on time-frame that is greater. Be aware that a break of a trendline lasted for several years usually results in a trend reversal (see aud/usd chart).

Strategy of action
There are two ways to make the most out of a trendline:

1. Either by buying/selling 5 pips before this trendline acting as support/resistance. Only valid when price is going for the towards the trendline.
2. Anticipating a break-out. The trendline has now four touches and price is going . A break-out takes place when price has broken by one pip.

Cease loss should always be placed outside the daily range. If price is further away than 40 pips, I bypass the scenario because of the stop loss.

Note of warning
A perfect trendline setup is quite rare and therefore don't expect it to happen once a day. You'll also discover that it requires some practice to have this right since conducting a relaying only on a single angled line is quite complied.
This is no holy grail and you ought to anticipate false break-outs to occur from time to time. This should not be problematic to get a trader if is used.