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Guys i'm pretty new to this, and theres been something i've been wondering about. In a few of Al's videos i've heard him mention something like "80 percent of reversals in a trend fail", or something along those lines.
But what is a trend? Is it a new change in direction for 20 bars on a 5 minute chart? Is it a change in direction for the entire day? Entire month? Is it a change in direction on the daily chart?
The reason i wonder this because i feel like "80 percent of reversals in a trend fail", may not apply to all of these different "trend time frames"... Or does it? Thanks!
Hi Chris,
Here is Al's definition from the Glossary on site:
trend
A series of price changes that are either mostly up (a bull trend) or down (a bear trend). There are three loosely defined smaller versions: swings, legs, and pullbacks. A chart will show only one or two major trends. If there are more, one of the other terms is more appropriate.
From the above you can see we get intraday minor trends (legs and pullbacks) as well as swings that one usually associates more with an overall trend like we have now in the Emini. It will need more than 2 or 3 legs down (a 15% pullback or more) to end current trend - see weekend report.
Okay this very helpful. Thank you admin. Im not sure if you tried to include a chart to use as an example. If you did, it didn't show up.
When you say, " A chart will show only one or two major trends. If there are more, one of the other terms is more appropriate." What chart are you referring to? A daily? Or just any time frame chart.
Is a trading range/Channel on the daily also considered a trend, the same as a bull or bear trend would be called a "trend".
Im not sure if this link im including will work. Its a daily stock chart of Uber.
If you look back starting 09/20 when it gaps up would this essentially all just be one big trading range that its currently in? For it to be considered a bull trend would it have to break up out of this range as you can see its pretty close to doing?
I think the best way to answer your questions would be going back to the course and rewatching the videos dedicated on trends in which Al explains what you are asking and, if after doing so any of your questions remains unanswered, we can try to help here. No offense, but if you are asking what is a trend I bet you didn't watch the course even once and, if so, it is absolutely impossible to succeed.
So, don't make me wrong, it is not that I don't want to give you the answers, but the course gives the information in a structured way and therefore when having questions about a topic you have to (re) watch the related videos first, this is where you will find the meat, not here. You will see that all your basic questions (what is a trend?, 80% BOs fail, and so on) will get answered there!
