2.1 How Identify Market Stage: Trend or Consolidation

How Identify Market Stage: Trend or Consolidation

Market price movements cannot go in one direction for a long time. A currency may strengthen, then weaken and strengthen again. The main task of technical analysis is to determine the trend. In total there are three types of trend:
- "Bullish" - prices move upwards;
- "Bearish" - prices move down;
- Flat- no definite direction.

 

Uptrend (Bullish trend)

UP Trend

During an uptrend (Bullish trend) prices are moving upward. The second minimum should be higher than the first minimum. If this condition is done on the chart, we can say it is a rising trend and high probability in the near future prices will continue to rise.

Downtrend (Bearish trend)

Down Trend

During a downtrend (Bearish trend) prices move down. The second peak must be lower than the first and the second minimum should be lower than the first.

No Trend—Congestion