Trend: trade with the current
Higher highs, lower lows, and how a moving average keeps you on the right side of the market.
6 min read
Prices don't move in straight lines; they move in waves. The direction of those waves is the trend, and trading with it is the single easiest edge a beginner can have.
Spotting a trend
- Uptrend: higher highs and higher lows. Each pullback stops above the last one.
- Downtrend: lower highs and lower lows.
- Range (chop): price bounces sideways between two levels with no clear direction. Most signals fail here.
Moving averages
A moving average (like the 200 EMA) smooths price into one line. Price above a rising average suggests an uptrend; below a falling one suggests a downtrend. It's not magic, it's just a quick way to see the current without squinting.
Key takeaways
- ✓Uptrend = higher highs and higher lows.
- ✓Choppy sideways markets are where most signals fail.
- ✓Check the higher timeframe's trend before you trade.
Quick check
Price makes a high at $110, pulls back to $104, then makes a new high at $115 and pulls back to $108. What is this?
Put it into practice
Every Yuppie signal checks trend on the chart and a higher timeframe before it fires.
Education only, not financial advice. Trading involves substantial risk of loss.