What is an Example of a Indices Trend? Identifying Trends in Indices Trading

A indices trend in indices trading is the tendency of indices prices to move in a particular direction for a period of time in a general direction upward or downward.

Trends can be analyzed using indices trend lines.

Indices Trend line analysis helps traders to define the direction of the stock indices trading market. Indices Trend lines connect a series of stock indices price highs or stock indices price lows forming a sloping indices trend which represents the general movement of the stock indices price.

For an upward sloping line this is known as an up indices trend - the indices trend line drawn is known as an upward indices trend line.

For a downward sloping line this is known as an down indices trend - the indices trend line drawn is known as an downward indices trend line.

Upward Indices Trend Line

An upward indices trend line is drawn below the upward sloping pattern by connecting at least two lows. This will draw a indices trend line that show the general direction of the stock indices trading market upwards.

The example explained and illustrated below shows how stock indices price moves when it is moving in an upward trend. The stock indices price will move upwards forming support levels.

Since the stock indices trading market moves in a zigzag manner indices traders normally draw a indices trend line which shows the general upwards indices trend direction.

What is an Example of a Indices Trend? Identifying Trends in Indices Trading - Indices Trend Definition

An up indices trend occurs when the stock indices price makes consecutive higher stock indices price highs and higher stock indices price lows. Each stock indices price high is higher than the previous stock indices price high - higher high, and each stock indices price low is higher than the previous stock indices price low - higher low.

Up indices trend lines gain more validity each time stock indices price touches but does not penetrate it. An up indices trend remains in place until this series of higher stock indices price highs and higher stock indices price lows is broken -indices trend line break reversal indices signal.

Downward Indices Trend Line

A downward indices trend line is drawn above the pattern formed by consecutive lower highs, it must connect at least two highs, with the most recent high being lower.

Since stock indices price moves down in a zigzag manner traders normally draw a line which shows the general downward direction. In stock indices market technical analysis, this general direction is referred to as the Indices Trading TREND by stock indices traders. This down indices trend line is drawn on a Indices chart showing the resistance levels (bearish indices trend market direction).

What is an Example of a Indices Trend? Identifying Trends in Indices Trading - Indices Trend Definition

A down indices trend occurs when the stock indices price makes a series of lower highs and lower lows. Each stock indices price high is lower than the previous stock indices price high - lower high, and each stock indices price low is lower than the previous stock indices price low - lower low therefore showing bearish stock indices price movement.

Down indices trend lines gain more validity each time stock indices price touches but does not penetrate the indices trend line. A down indices trend remains the general direction until this series of lower stock indices price highs and lower stock indices price lows is broken -indices trend line break reversal indices signal.