What Is a Trend?
Higher highs and higher lows, or the opposite. Defining trend so you stop guessing.
Everyone talks about “the trendThe prevailing direction of price: up, down or sideways.,” but few can define it precisely — which is why so many traders argue about direction. A trendThe prevailing direction of price: up, down or sideways. has a concrete, objective definition based on the sequence of highs and lows the price makes.
- UptrendThe prevailing direction of price: up, down or sideways. — a series of higher highs and higher lows. Each rally pushes further, and each dip stops at a higher level than the last. Demand is winning.
- DowntrendThe prevailing direction of price: up, down or sideways. — a series of lower highs and lower lows. Each bounce fails sooner and each drop goes deeper. Supply is winning.
- Sideways/range — highs and lows roughly level; neither side is in control.
Defining a trendThe prevailing direction of price: up, down or sideways. by structure (the pattern of highs and lows) instead of by feel removes opinion from the equation. You no longer guess “it looks bullish” — you check: are we still making higher highs and higher lows? The trendThe prevailing direction of price: up, down or sideways. is intact until that structure breaks (e.g. an uptrend makes a lower low). This single shift, from gut feel to objective structure, is what lets you stay in winners and exit when the trend actually changes — not when you get nervous.
ExampleA stock goes ₹100 → ₹120 (high), dips to ₹110 (higher low), runs to ₹140 (higher high), dips to ₹125 (higher low). Textbook uptrendThe prevailing direction of price: up, down or sideways. — hold it. Only when it later fails to exceed the prior high and breaks below the last higher low does the uptrendThe prevailing direction of price: up, down or sideways. structure break.
Key takeawayA trendThe prevailing direction of price: up, down or sideways. is defined by structure: uptrendThe prevailing direction of price: up, down or sideways. = higher highs + higher lows; downtrend = lower highs + lower lows; sideways = neither. Judge trend by this objective sequence, not by feel — it’s intact until the structure breaks.
FAQs
Can different timeframes have different trends?
Absolutely — and they often do. A stock can be in a daily downtrend (lower highs/lows) while still in a weekly uptrend. Always specify the timeframe you mean, and align your analysis with the one that matches your holding period (see the timeframes lesson).