Introduction To Trends And Time Frames

By | June 20, 2016

Taking sense of trends and time frames is an usually confounding commission. At any one time, in any given time frame, compound trends can be at play. There are long term secular trends, shorter term primary trends, till shorter term secondary trends and yet shorter till near and short term trends. Adding to the confoundedness of trends is the time frame. What may be simple to spot in one time frame might not be so simple to spot in another. This article will help to take some sense out of trend and time frame for binary merchants. This is an important feature of doing business and one that I highly propose everyone master whatever of chosen plan of them. The eaderly talking, “the trend is friend of you, business with friend of you” is as true today as the day it was first spoken. Similarly, the saying “a rising tide lifts all boats” is alike apt.

A trend is expressed as a general supervision is which something is turning or growing. In the situation of doing business financial assets a trend is a reckonable control in prices, offen up or down. Trends can and do exist in every time frame and understanding how they work is one key to avoiding obstruction. Imagine this, the tide is rolling in and each wave that comes onto the shore is a little higher than the other next. All a sudden other wave pulls way way back, looking as if the tide may have changed. Is it more possible that the next wave will meet or exceed the previous high water mark or less? This is the core of trend analysis, finding the direction of the market tide and the possibility that the next wave will be higher or lower than the other next Neo2

The Secular TrendTrends And Time Frames

The firstly and strongest, trend for merchants to be aware of the secular trend. The secular trend is other that last anywhere from 7 to 15 years and is usually in synch with underlying economic situations. A secular bear market is one in which the market places trend down to sideward for a period evaluated in years. A secular bull market is one in which the markets trend upward for years. In a bull secular market it is more possible for shorter term bear markets to meet ratify and reappearance to optimistic than they are to cause in major improvement. The same is true in opposite for a secular bear market. This trend can be watch on a chart of 10 years duration or longer as shown here. I make of using monthly closing to help core the chart. Within the secular bear market labeled here there are periods of up and down markets, these are the leading trend.

The Leading Or Long Term Trend

The leading trend is the largest reckonable price progress within a secular market. These trends tend to last from 3 to five years being influenced by strength. You can watch that within the secular market I have market there are at least five noticeable leading trends end up with the final bull trend that broke the top of the secular bear market scope. Take note that during the secular bear market that the bearish leading trends are much stronger and of longer duration than the bullish primaries. This same fact will be true in opposite for secular bull markets. In order to analyze the leading trend I practice down to a from 3 to 5 year chart of weekly closing prices, whichever is needed to involve the whole movement. This next chart shows the final leading trend of the 1999-2013 secular bear market. We can watch again that on this chart that there are shorter bull and bear markets within this trend but that the underlying primary is in power. Bear markets are not as deep as bull markets are tall.Business made in this time frame would have an outlook of weeks or even months.Trends And Time Frames1

The Secondary Or Short Term Trend

In the leading trend are secondary trends. These are the near and short term meeting and dips driven by news and events. Also the trends of most interest to me and other binary merchants emphasis on weekly and monthly expiries. To watch the secondary trends I move down to charts of daily price action like the one below. Signs on this chart would have an outlook of a few days to a week or up to a month. There are even trends in this trend driven almost be fears and expectancies and less by actual news or events.Trends And Time Frames3

Why Is Trend Analysis Important?

It is important to know trend for many reasons but most importantly to help know why one do business is more possible to turn a profit than another. If the marketplace is doing business lower in the leading trend then it is less possible for a bullish play on the secondary trend to work than a bearish another. Similarly, if a sign in the secondary trend firms the leading trend then it has a higher option of profiting than a secondary sign that is counter to the leading trend. One way to line up a great business is to have as many time frames in affirmation as probable. The secular trend is very too long for binary merchants but you can begin with the leading trend and move down to the secondary trend and then the near term trend. A sign made with all three trends in alignment has the most option of victory.