Determine the trend on a timeframe

How do we determine the trend on a time frame? Let's say we have an uptrennd with a succession of up swings followed by pullbacks. How do we now that it is an uptrend, and not an uptrend, followed by a reversal and a downtrend, and then a reversal followend by an uptrend again and so on?

Well, that’s why I count the Support/resistant levels so seriously! Usually, I use the Daily trading chart to identify the market trend, since it gives me such a clear view! When I see market move breaks an important support/resistant levels to strongly, it hints me the strength of that trend!

On the other hand, I don’t count each and every candle to understand the continuation of that trend; instead of that I just focus on specific group of candles; suppose if I believe we are in a bull trend & I see consistent big Green candles after a small counter trend move: that means, it’s very possible to have another higher high in the next move!

I am not saying anything new if I point out that the price cannot go up indefinitely or go down indefinitely. Yes, that is obvious. I agree with the previous opinion that support and resistance levels can be useful in analysis in this case, especially if you see clearly formed levels that have a logical justification. If it is more about fundamental analysis, then you can definitely listen to expert opinions, which usually appear almost immediately as to what level price will reach and why. Generally, in order to be prepared for such things, you should always have free margin, which you can use to back up your positions in the market.

You just can't do without things like understanding levels and understanding the trend.
You know, it's a bit more complicated than it sounds and I wouldn't say I could give you all the details and it would be clear to you in 5 minutes.
You know.
That's not what's important here.
You need to make you understand HOW it works and HOW it can be included in the analysis, so that you can better navigate the situation.
You may think that this is not what many strategies are set up to do, it's not.
It actually has a dependence on how the price of a particular asset is shaping up.
I certainly don't take fundamental analysis into account, although they are probably the ones that form the strongest jumps in the market...

It's been said. But let's try to give you a practical example.

Go to USDJPY.

Identify the trend it was in. Was it up or down?

Switch to the MONTHLY chart. Zoom out.

Price broke a level that it's not been since 2012 or something. It's been as far in that trend direction as it's ever been. It broke that level. Consolidated. Made a double formation on the D1 and W1 - and has started going in the opposite direction.

I'm not specifically saying if it's an up or down trend - if it's a double top or bottom - if there's an engulfing candle or not - if it broke any key levels - if it went to any Quarter's Theory zone - if it went to an ADR or anything. I don't know your chart or setup. Most if not all of what I've outlined can be identified and probably more.

Draw a channel or trend line on the chart and see where things are. Once you post a reply I'll post a chart screenshot. As was said - price can't go one way forever. And the book "Naked Forex" had a line in there which said..."look to the left". Good book.

Take note of something. Charts are fractal in nature. You can see things if you zoom out, but you won't be able to zoom out enough on a M1 chart to see the trend on the D1 for example. Price can also be moving down on the M15 but up on the H4. So what do you do? Decide on a strategy.

Reversal? Trend? Are you going to trade it in both directions? Are you going to only trade after a retracement? Are you trading with or without indicators?

No reply from the OP. So let's do this.


There's the USDJPY chart. Plain using a lovely template available here in FF. Now let's look at this.


I don't want to put any of my own theory or analysis in there. I would really like the OP to put in their own spin. So standing by again. I've drawn some (mostly) transparent lines on this. What do you notice?


I'll say this. Charts are fractal in nature. The patterns and behaviors on a lower timeframe can be applied to a higher timeframe. That's all for now. Waiting on the OP to reply to the initial questions in the post right above this one.

Generally speaking, if you think globally, if you see your chart gradually (in the long run) going up, this inevitably means a bullish trend, which is an increase in price. In the opposite case we see a bearish trend, correspondingly a fall in the price of the asset.
However.
There are different strategies associated with different assets, timeframes, and parameters that you need to understand and be able to analyse correctly.
So I would not be tied to any general parameters and I would focus first on a strategy that you understand and that will give a full or at least partial understanding of the situation.
I would spend enough time studying such an issue, these are really the basic things that will always be useful to you.

The range is your true real friend.

Well, this is the problem which many newcomers face. Determining the trend on a particular timeframe has to be the very first thing which should be learnt by novices. I would advise you to read more information about it in th internet, but now ofc, I would give you some tips. When you want to determine a trend on M15 timeframe for example, you have to check th trends on higher and lower timeframes. If you see that on both M5, H1 and H4 timeframes there is an uptrend, then indubitably, your M15 also has an uptrend. Try to draw horizontal lines and if the line will touch at least 2 lower shadows, then it's an uptrend.

Determining a trend on a timeframe. You can do it with fractal highs & lows and/or candlestick by candlestick.

If you are looking at a particular timeframe, you can drop down a timeframe or two to see the "inner moves" to that trend.

Generally, in an uptrend you want to see Bearish candles engulfed by Bullish candles and vice versa.