What is an Examples of a Stocks Trend? Identifying Trends in Stocks

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

Trends can be interpreted using stocks trend lines.

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

For an upwards sloping line this is referred to as an up stocks trend - the trendline plotted is referred to as an upwards stocks trend line.

For a downwards sloping line this is known as an down stocks trend - the trend-line drawn is known as an downward stocks trend line.

Upward Stocks Trend Line

An upward stocks trendline is drawn below the upwards sloping pattern by connecting at least 2 lows. This will draw a stocks trend line which show the general direction of the market upwards.

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

Since the stocks market moves in a zigzag manner stocks traders normally draw a stocks trendline which shows the general upwards stocks trend direction.

What's an Examples of a Stocks Trend? Identifying Trends in Stock - Stocks Trend Definition

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

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

Downwards Stocks Trend Line

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

Since stocks price moves downward in a zigzag manner traders normally draw a line which shows the general downwards direction. In stock trading market technical analysis, this general direction is referred to as the Stocks TREND by traders. This down stocks trend line is drawn on Stocks chart showing the resistance levels (bearish stocks trend market direction).

What's an Example of a Stocks Trend? Identifying Trends in Stock - Stocks Trend Definition

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

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