How to Identify trends:-
In today's lecture 1.6 we will understand trends identification.
Okay, here's a quick rundown on spotting trends:
* Visually: Look for consistent higher highs/lows (uptrend) or lower highs/lows (downtrend). Sideways means no clear trend.
* Trend Lines: Draw lines connecting lows (uptrend) or highs (downtrend). Breaks can signal changes.
* Moving Averages (MAs): Price above MA = uptrend, below = downtrend. Crossovers (shorter MA crossing longer MA) can signal trend starts.
* MACD: Above zero = bullish, below zero = bearish. Crossovers of the MACD line and signal line can indicate trend shifts.
* ADX: Above 25 suggests a strong trend (direction needs other tools).
* RSI: Can confirm trend strength and show potential reversals (divergence).
* Chart Patterns: Look for formations that suggest continuation or reversal of the current trend.
* Multiple Timeframes: Check different timeframes for agreement on the trend direction.
Key takeaway: Use a mix of these methods for better confirmation. Timeframe matters!
that's all for today...
see you...
