Downtrend

A sequence of lower swing highs and lower swing lows.

A strong candle inside a downtrend that fails to clear the last lower high has changed nothing. Treating every strong candle as a reversal is one of the more expensive habits in trading.

The structure holds until a lower high is broken to the upside.

Taught in

Highs, Lows and the Shape of a TrendMarket Structure

Swing highs and swing lows are the skeleton of every chart. Learn to mark them, and "trend" stops being a feeling.

Also covered in that lesson

Swing highA candle whose high is higher than the candles either side of it — a local peak where an advance stalled.Swing lowA candle whose low is lower than the candles either side of it — a local trough where a decline stalled.UptrendA sequence of higher swing highs and higher swing lows. Both conditions are required — rising highs alone are not an uptrend.

Related terms

Uptrend Swing low