What is a "defined" trend?
- Thread starter GiantDog
- Start date
That is how I define a trend.
I use that term frequently; possibly Iâm the trader to whom you refer. With regard to oil futures:
A defined uptrend in my given framework (a 5-min time chart) consists of a pattern where I can identify one swing low thatâs higher than a previous swing low, followed by a move up that breaks the swing high between the two swing lows by at least as many ticks as the difference between the swing lows.
A well-defined uptrend consists of a move up thatâs so strong the pullbacks fail to print a bar close below previous resistance levels. This usually occurs when price breaks through a high of the day by 10 ticks or more.
Reverse for downtrends.
Price can print a strong trending move without a definable trend being in play. For example, today oil prices were channeling down in pre-market on a 5-min time chart. At the start of the pit session price broke through two previous swing highs without a single pullback on the 5-min chart, then just as quickly sold all the way back to the swing low just before the pit opened. In the 5-min time frame, no trend asserted itself during those two strong moves.
As with all price action patterns, often times close is close enough, so if a value is off by a few ticks or price throws a little head fake at you then turns right back around, consider the trend intact until proven otherwise.
A defined uptrend in my given framework (a 5-min time chart) consists of a pattern where I can identify one swing low thatâs higher than a previous swing low, followed by a move up that breaks the swing high between the two swing lows by at least as many ticks as the difference between the swing lows.
A well-defined uptrend consists of a move up thatâs so strong the pullbacks fail to print a bar close below previous resistance levels. This usually occurs when price breaks through a high of the day by 10 ticks or more.
Reverse for downtrends.
Price can print a strong trending move without a definable trend being in play. For example, today oil prices were channeling down in pre-market on a 5-min time chart. At the start of the pit session price broke through two previous swing highs without a single pullback on the 5-min chart, then just as quickly sold all the way back to the swing low just before the pit opened. In the 5-min time frame, no trend asserted itself during those two strong moves.
As with all price action patterns, often times close is close enough, so if a value is off by a few ticks or price throws a little head fake at you then turns right back around, consider the trend intact until proven otherwise.
To add a bit to NoDoji's comments:
A trend depends on 2 things.
1. Your definition of "trend"
2. The framework on which you are working be it a volume chart, price chart, tic chart, etc.
Simply put: A tradable "up trend" on a 1 minute chare for a scalper may just be a minor correction wave for a person using daily charts.
It ain't rocket surgery!
A trend depends on 2 things.
1. Your definition of "trend"
2. The framework on which you are working be it a volume chart, price chart, tic chart, etc.
Simply put: A tradable "up trend" on a 1 minute chare for a scalper may just be a minor correction wave for a person using daily charts.
It ain't rocket surgery!
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Giant D;
good + simple note, i agree..
Other help includes,, for a downtrend;
lower closes,,
lower opens,,
lower hi,,
lower lows.
Market reaction to news ;
+ not much suppoort in a bear market at all.
.As Alan Farley says ''bears live below 200 dma''] A dip/brief dip below 200 dma may mean nothing at all.......Wisdom is profitable to direct
50 day[+50 period] ma= good measure ;;;;;
200day ma,= good measure of a trend. ...................................................................
Agree, it completely depends on how you define it, what you use and I would add how much up or down you expect define trend to go.