7.12What is a trend?
1What is it?
A trend is the general direction of price over time: up, down or sideways.
2Why does it exist?
"The trend is your friend": trading in the trend’s direction tends to improve odds.
3Quick revision
- Up, down or sideways.
- Identify on higher time frames.
- Trends end eventually.
4Knowledge check
Q1. Name three types of trend.Show answer
Uptrend, downtrend, sideways.
Q2. What does "the trend is your friend" mean?Show answer
Trade in the direction of the main trend.
Q3. Do trends last forever?Show answer
No.