What is an Examples of a Oil Trading Trend? Identifying Trends in Oil Trading

A oil trend in oil trading is the tendency of oil prices to move in a particular direction for a period of time in a general direction upward or downward.

Trends can be interpreted using oil trend lines.

Oil Trading Trend line analysis helps traders to define the direction of the market. Oil Trading Trend lines connect a series of crude oil price highs or crude oil price lows forming a sloping oil trend which represents the general movement of the crude oil price.

For an upwards sloping line this is known as an up oil trend - oil trend-line plotted is known as an upwards oil trend line.

For a downwards sloping line this is known as an down oil trend - oil trend-line plotted is known as an downwards oil trend line.

Upwards Crude Oil Trading Trend-line

An upward oil trend line is drawn below the upward sloping pattern by connecting at least two lows. This will draw a oil trendline that explain general direction of the market upwards.

The example explained below shows how crude oil price moves when it is moving in an upward trend. The crude oil price will move upward forming support levels.

Since the crude oil market moves in a zigzag manner oil traders normally draw a oil trend-line which shows the general upwards oil trend direction.

What's an Examples of a Oil Trading Trend? Identifying Trends in Oil Trading - Oil Trading Trend Definition

An up oil trend occurs when the crude oil price makes consecutive higher crude oil price highs and higher crude oil price lows. Each crude oil price high is higher than the previous crude oil price high - higher high, and each crude oil price low is higher than the previous crude oil price low - higher low.

Up oil trend-lines gain more validity each time crude oil price touches but does not penetrate it. An up oil trend remains in place until this series of higher crude oil price highs and higher crude oil price lows is broken - oil trend-line break reversal oil trade signal.

Downwards Crude Oil Trading Trend-line

A downwards oil trend-line is plotted above the pattern formed by consecutive lower highs, it must connect at least two highs, with the most recent high being lower.

Since crude oil price moves downward in a zigzag manner traders normally draw a line which shows the general downward direction. In crude oil market technical analysis, this general direction is known as the Oil Trading TREND by crude oil traders. This down oil trend-line is drawn on a Oil Trading chart showing the resistance areas (bearish oil trend market direction).

What's an Example of a Oil Trading Trend? Identifying Trends in Oil Trading - Oil Trading Trend Definition

A down oil trend occurs when the crude oil price forms a series of lower highs and lower lows. Each crude oil price high is lower than the previous crude oil price high - lower high, and each crude oil price low is lower than the previous crude oil price low - lower low therefore showing bearish oil price movement.

Down oil trend-lines gain more validity each time crude oil price touches but does not penetrate the oil trend line. A down oil trend remains the general direction until this series of lower crude oil price highs and lower crude oil price lows is broken - oil trend-line break reversal oil trade signal.