Trend is anything that is currently being talked about, noticed, worn or used by many people at a certain time. In this case, the signs that an object is becoming a trend are if it is the center of the conversation, the center of attention and is often used.
Trend is shape nominal which means the latest variety of ways or forms on a certain time (clothes, hairstyles, decorative patterns, and usage) hijab and so on).
All markets must have a trend, be it stocks or futures, even in other markets there must be a trend. Generally, a trend is a series of price track records in the form of a graph with a tendency to point up (uptrend) or down (downtrend).
However, the variation of the trend is not only limited to just going up or down. To be clear, let's study the types of trends in general.
Trend types
Here is a quick picture of the types of trends that might be seen in the market
• Uptrend: Prices move up gradually.
• Sideways: Prices are consolidating due to a tug of war between sellers vs. buyers. In this condition the direction of the trend is difficult to identify because the price only moves up and down within a certain range, without a clear direction.
How to Know Trends
In the market, prices do not move regularly, either down or up, the movement is often unpredictable because it moves in a series of waves or moves in a zigzag fashion in an ongoing trend. This is because the market moves is influenced by the strength between buyers and sellers. keep changing.
Traders will generally be confused about which direction the trend will move, especially when faced with a moving real market, especially novice traders.
Then how to simply predict the direction of the trend?
The following is the simplest way so that you can predict the direction of the trend, now I will take an example from the futures market
1. Determine the Timeframe First
You can find trends in all timeframes, the smaller the timeframe, the faster the trend changes direction. Generally each trader has 2 major timeframes. Large timeframe to see Long term trends and small timeframe for execution or entry
Use trendline tools
Trendline tools can usually be found in all kinds of futures trading software and what I can use is Metatrader 4
Use these trendline tools to provide visual clues about the direction of the current trend. It's easy, just draw the trendline following the swing point or the point where the price starts to "swing" sharply
2. Compare the high and low price points during a certain period.
In addition to the help of trendlines, you can observe price action (price action) on the candlestick itself as a benchmark to determine the direction of the trend. Like the following example:
Uptrend (uptrend) can be identified from the point of the highest price and the lowest price that continues to rise (higher highs, higher lows). On the other hand, a downward trend is identified if the highest and lowest prices continue to decline (lower highs and lower lows).