Technical Analysis using Flat Line trading strategy with ATR ( Average True Range)
As a techie trader, there are multiple ways to do technical analysis to determine entry and exit points for a trade. Flat Line trading strategy is a very old and effective strategy that works very well to determine the entry/ exit points and when combined with ATR ( Average True Range), it allows you to confirm your exit strategy ( at what price should i exit out of the trade).
The contents of this post will be
- What is a flat line?
- What is ATR?
- How to draw a flat line?
- Entry criteria
- Exit criteria
- video showing an example
What is a flat line?
Flat line is a horizontal line that can be drawn through at least two ( recommended 3 ) closing prices on the time line ( daily, weekly) considered. These flat lines drawn can be considered as support if the price is above and can be considered as resistance when the price is below. Moving averages 10, 20, 50, 100, 200 can also be used in conjunction with the flat lines as support and resistance
What is ATR?
As per investopedia, Average true range (ATR) is a technical indicator measuring market volatility. It is…
