Reading a chart
Trend and range
A trend is a sequence of swings. A range is a price that keeps returning to the same area.
Lesson 1 of 4 • 12 min
Worked example
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A rising trend, on the chart in front of you, is a run of higher highs and higher lows. A falling trend is the opposite. A range is what you have when the price keeps failing at the same upper area and the same lower area.
Those are descriptions of what already printed. They are not a promise that the next swing will continue. A trend ends. A range breaks. The job of this lesson is to name what you see, and to say what would make the name wrong.
If you cannot point to two swings, you do not have a trend yet. One strong candle is not a trend. It is one candle. Mark the swings the chart-structure course already taught, then give the chart one of the three names: rising, falling, or ranging. If none of them fit, write "unclear" and leave it.
Unclear is a complete answer. Forcing a name onto a messy chart is how stories begin.
- Rising: higher highs and higher lows.
- Falling: lower highs and lower lows.
- Ranging: the same ceiling and the same floor, visited more than once.