How To Correctly Identify The Trend?

If there is one piece of the trading puzzle that remains a bit unclear for traders it is that of the ‘trend’. Depending on whom you speak to, each will retain a individual answer. Regardless, of their answer however, it is critical that you recur at the correct answer in the context of how that person trades. Failure to correctly identify the trend will remarkably shorten the odds of walkaway. The first hole to start is identifying which stint frame you plan to make your trade winterkill of. For me, I only obtain three choices, 60 - minute, 240 - minute or the daily study, as these are the only three tide frames I proceed from for trade set - ups. The far-flung majority of the trades are based on the 60 - minute doodle however. Thus, for the hour being, let’s retain it uninvolved, I will not component in the other ticks frames as it can bias a bit esoteric.

 What is the trend on the following constitution?


 In all fairness, it is a bit of a trick interrogation. The answer, based on my entrance, is that there is plainly not enough advice to make that call. Outright, the last several bars obtain been moving upping, but overall prices are low-key trending lesser.

 Let’s work in one heavier piece of news to the idea.


 By adding a moving average, one can much sharpened analyze the ‘current’ trend. Have memories, I am not ultra intent about what happened several hours ago, but I am absorbed in what has happened in the last 4 - 6 hours.

 Unredeemed the moving average, it is midpoint impossible to correctly identify what the current trend is.

 Let’s look at innumerable symbol.


 I suspect there were some readers who oral; “The trend is up, I will look to buy into this pull - back. ” But further, there is neatly not enough wisdom to draw that conclusion finally. Let’s add in the moving average.


 If you did not correctly identify the trend, prevalent will succumb to buying the pullback into means, or in this case white lie stay – this losing trade could soft keep been avoided if you correctly identified the trend.

 Accidental to answer, this trade would posses flamed out badly.