Sirwin
Sirwin

Bullish and bearish trends.


Bullish and bearish trends are key concepts in technical analysis in trading. Traders use these trends to determine the future direction of financial asset prices and make investment decisions.

The bullish trend is characterized by a series of higher prices and higher price levels. Traders consider an uptrend to be in place when the price of an asset rises steadily over an extended period of time. In an uptrend, buyers have an advantage and are willing to pay higher prices for the asset, pushing the price higher.

Traders look to identify an uptrend by using technical analysis tools such as moving averages, trend lines and momentum indicators. They look for signs of strength in the price charts, such as volume increases and resistance breaks, to confirm an uptrend. Graphically, an uptrend is characterized by higher and higher highs and lower and lower lows.

A downtrend, on the other hand, is characterized by a series of lower prices and lower price levels. Traders consider a downtrend to be in place when the price of an asset declines steadily over an extended period. In a downtrend, sellers have an advantage and are willing to accept lower prices for the asset, which pushes the price down.

Traders look to identify a downtrend using the same technical analysis tools as for the uptrend. They look for signs of weakness in the price charts, such as volume declines and support breaks, to confirm a downtrend. Graphically a downtrend is characterized by lower and lower highs and lower and lower lows.

Traders can use bullish and bearish trends to make investment decisions. For example, a trader who identifies an uptrend may buy the asset in question, while a trader who identifies a downtrend may sell the asset or take a short position.

It is important to note that trends can be short or long term, and that a trend can reverse at any time. Traders must therefore be aware of the risks and use appropriate risk management to minimize potential losses.

 

How do you rate this article?

8


Bastien Scellier
Bastien Scellier

Young man passionate about building the best man possible. Here to share my learnings, personal development, philosophy, investment, business and crypto...


Technical analysis lessons.
Technical analysis lessons.

Here I will state the different principles of technical analysis so that you can refine your vision on the financial markets.

Send a $0.01 microtip in crypto to the author, and earn yourself as you read!

20% to author / 80% to me.
We pay the tips from our rewards pool.