DaytradeTeam Profitzzz

When talking about stock trading, you hear about uptrend, downtrend, sideways trend and popular phrases like “the trend is your friend”.

Understanding the concept of trend is extremely important to technical day trading. Traders will use a variety of tools to measure it, such as support and resistance levels, price patterns, moving averages, trendlines, etc., for the purpose of trading with the trend or identifying when the trend has ended.

Just what is trend, and why is it important? .

First let’s take a look at what it is. Generally speaking, trend can be defined as the direction in which the market is moving. More precise, trend is a series of zigzags, known as highs and lows which flow in succession. It is the direction of the highs and lows that constitutes market trend. These successive waves can be classified into a few categories:

1. An uptrend which is defined as a series of successively higher peaks and troughs:
2. A downtrend is a series of declining peaks and troughs:
   
   
3. A sideways trend is a display of horizontally moving peaks and troughs: