Trend
A sustained directional move, defined by higher highs and higher lows, or lower highs and lower lows.
Full explanation
A trend is a market making consistent progress in one direction. In an uptrend each pullback stops above the previous low and each push exceeds the previous high; in a downtrend the pattern is reversed.
Trends are timeframe-specific. A market can be in an uptrend on the daily chart while pulling back for several hours on the 15-minute chart. Both statements are true, which is why traders state the timeframe when describing a trend.
A trend is not a promise. It describes what price has done, not what it must do next. Trends end, and they usually end by first failing to make a new extreme.
Why traders watch it
Identifying the trend decides which techniques are appropriate. Trading with the prevailing trend means buying pullbacks rather than chasing extended moves, and it usually gives a clearer invalidation point.
The Trading Plan describes trend context so the day''s guidance matches the market environment, and never as a prediction that the trend will continue.
Trading considerations
- State the timeframe whenever you describe a trend.
- Entering after an extended run gives worse risk than waiting for a pullback.
- A trend is intact until the structure of highs and lows actually breaks.
Educational guidance only — never a trading signal or recommendation.
Related indicators
ATR (Average True Range)
ATR, or Average True Range, measures the average distance a market travels over a chosen number of periods, including gaps. It is a pure volatility reading with no directional bias. Traders use ATR to set stop distances that respect normal noise, to size positions consistently, and to judge whether current conditions are unusually quiet or unusually fast.
Bearish candle
A candle that closes below its open — sellers finished the period in control.
Bollinger Bands
Bollinger Bands are a volatility indicator made up of a moving average with upper and lower bands that expand and contract as market volatility changes. They help traders judge whether price is becoming stretched, identify volatility changes, and support both trend-following and mean reversion analysis.
Breakout
A breakout occurs when price moves decisively beyond a defined level such as a range high, trendline or consolidation boundary. It signals that the balance between buyers and sellers has shifted and can start a sustained move. Breakouts also fail often, so traders look for confirmation through follow-through, expanding range and a successful retest of the broken level.
Bullish candle
A candle that closes above its open — buyers finished the period in control.
Candle
A single bar on a candlestick chart showing the open, high, low and close for one period.