The trendline is a very important element of technical analysis. When we identify the trendline in a sports betting graph, we can estimate the general preference among the bettors in that particular betting market. As the odds go up and down, we can draw straight lines from one peak to another as a simple and quick method of prediction of whether or not people trust this specific bet.
In addition, the trendline could predict forthcoming odds movements, which would lead, if proven accurate, to profit when sports trading on this indication, before even the game’s result is decided.
Compared to other methods of technical analysis, the trendline, well known among traders in financial markets, is the easiest technical analytic tool to understand and implement even in betting exchanges, such as Betfair. Even though its use may require some basic analytical skills, average players should not find it difficult to take advantage of this drawing tool.
Players not familiar with trading, who have never come across a betting graph or a similar stock chart, soon will be able to include this tool in their arsenal, when they want to predict a possible change of the odds.
This may even be a good opportunity to try out sports trading for the first time.
Drawing the trendline
When the odds are dropping, we can draw a straight line on the betting graph from one peak (top) to another, which would show the general betting trend on that particular betting market.
The slope of the line will be downwards in case of a downtrend.
In the opposite case, when the odds go up, known as drifting, we can connect the lower lows (bottoms) of the odds chart. The new slope would reveal the uptrend of that betting market.
Finally, there is a phase called consolidation. In that phase, we end up drawing two parallel lines, which move sideways without any sign of climb or descent. During consolidation it is generally believed that the market is getting prepared for the next trend; that is before it gains momentum once again.
However, these almost horizontal lines, will prove helpful when we talk about support and resistance levels.
If during the drawing of the trendline we notice extreme moves (spikes), which sharply deviate from the straight line, we tend to ignore them. The reason is that, as this reaction is probably random, it is not considered important in identifying the general trendline. Remember that drawing the trendline means connecting several points, that already show the way.
If for example, 5 tops are used to draw the trendline, it is best to ignore a spike that extends far from the line, since the importance of the remaining number of points in predicting the trend is clearly higher.
Using Trendlines in Sports Trading
Primarily, the trendline helps as an indication of the general momentum in regard to possible odds movements. In other words, within a few seconds we are able to say whether the betting odds for a team or player fall or rise.
This general trend will function almost subconsciously when, after we use more tools for technical analysis, we choose the best timing to begin trading. If we do not have the general betting trend in mind, we bet blindly; just guessing the way the odds will move towards to. Furthermore, as it takes so little time and effort to draw the trendline, it is inexcusable not to do that as our first analysis of a betting graph.
For this reason, you should go ahead and practise using the various charts that are available on betting exchanges, in order to gain the necessary experience in drawing trendlines. In the future trendlines will be one of the most important tools in your sports trading strategy.