Trend (แนวโน้ม)

A trend is the general direction in which a price moves over a period of time. Prices never move in a perfectly straight line, so a trend is judged by the overall pattern of the peaks (highs) and dips (lows), not by a single candle.

The three types of trend

• Uptrend: The price makes higher highs and higher lows. Each peak is above the last peak, and each dip stays above the last dip.
• Downtrend: The price makes lower highs and lower lows. Each peak is below the last peak, and each dip falls below the last dip.
• Sideways trend (range): The price moves between a roughly steady top and bottom without making clear progress up or down.

Simple example

Imagine the price of gold swings like this: it rises to 2,010, dips to 2,000, rises to 2,020, dips to 2,010, then rises to 2,030. The highs (2,010, 2,020, 2,030) and the lows (2,000, 2,010) are both climbing, so this is an uptrend. If the highs and lows were falling instead, it would be a downtrend.

Why it matters

Many traders first identify the trend, because it gives context for what the market has been doing. Trends are also relative to the time frame: a chart can show an uptrend on a daily chart while a 5-minute chart shows a downtrend.

A common beginner mistake is to assume a trend will continue forever. Trends can slow down, move sideways, or reverse at any time, so a trend is a description of the past and present, not a guarantee of the future.