Trend definition
Trend
A trend in forex refers to when the market moves higher or lower within a specific period of time. A trend is usually classed as either an uptrend or a downtrend. Uptrends indicate buyers have more influence over the market, and downtrends indicate sellers hold more influence over the market.
How to identify a trend with trend lines
Trends are identified through technical analysis with the use of trendlines. Traders create trendlines by connecting three or more lows or three or more highs.
- To draw an upward trendline, three or more lows must be connected by a straight line slanting up
- To draw a downward trendline, three or more highs must be connected by a straight line slanting down