So, in this lecture, we want to talk about trends and trends and trending systems are one of the basic methods in the chart analytics and also in this module, because what let us first declare what is a trend, if if a trend appears a mess of people or institutions are following them, this is the psychology of the mess. And if we are under stock market, we want to follow this trend, because the trend and the mass of the people are ruling the prices and that's why the trend is your friend. So, let us see what is the trend Exactly. First of all, we have the normally positive trends. So which means the stock prices rising up. And on the other hand, we have the negative trend, which easily means the stock prices falling down.

So we have two ways of trend systems. And we can work with them look at easily work with them, because we can look in the chart and look for points or ruling points that are saying that the trend is intact. Okay. So normally, if we look for trends, we look for this one and don't look very special right? But this is an intact trend. Why is this an intact trend?

So, the characteristic characteristics of an intact trend are the following two points. First, we need 300 Points okay. As you see each of the highest points in the chart so the stock price must be higher than the one before. And also, we need higher lows, okay, which easily means that the stock price don't fall back to this beginning point of where we look for an in tech threat. So this is the first one that we need. And first one that we need our first point for an in tech trend and the second one is the trend line.

You will see the trend line in many videos here in this course and also the trend funnel. So what is the trend line if there is a trend line You can make this like this, okay? Which means if we look for trend, the lower points should not break through our underlying trend line. Okay? They shouldn't break through the line. If they do this is normally normally that the trend isn't intact, okay, which means there is no trend anymore.

And on the other hand is the trend line. So and we have also the trend funnel, swift the second trend line, the upper and the lower one. And if we see this, here, now get a better, better picture of how you can analyzing a trend. And if you see in this, you'll see we have an intact positive trend. And the chart is moving between the two trend lines. And if the chart does, if the chart do this, we have really, really good signal that we have an intact trend and we can follow this trend.

So let's say if this is our whole trend funnel, what would normally happen now, if the trend is intact, it would fall down to this point to the lower trendline. And this could be this point where we can invest because we have a cheaper price than the higher one. Get stocks and shares the index However, what get cheaper and We look to our to our trend lines, the price should come up there, okay. And they're in there. So, this is the basic basic training system. And with this technique, you can you can easily make a profit from a couple of percent.

And it's normally always working if the trend is really accept we are will making a lot of training systems in this course. And there are some trend following systems. So this is the basic trend. And if you want to look if their trend is intact and we have some other signals, we are calling that trend following systems. Okay, the trend is falling by a system. And this is really interesting because There's so many back tests of it that you have a significantly high rate of a good profit rate, only worse the trending system.

So we are now want to talk about the easy trends. And I'm here in the German DAX index and found the first negative trend here, which I want to show you that you see what is the negative the easy negative trends. So, for the rules, we need the three points on our trend line, which should not break through the trend line. And what you see in normally or basically if you're if you're practicing trading that you have Those little Pike's going under the line or through the line. So that are the end of the of the candles, but not the candle itself. So just for understanding and what you can see here is in the negative trend in the ducks from from September to October the for this year and what easily can see as negative trend However, in this in this one, it doesn't work as an indicator because we have the political news after it and the tax raises up again.

However, we have this one over here Which is, which is also a negative trend. Yeah, we actually have some negative news here. So the negative trend you can see here is this one. So we have the three points hitting the lower trendline. And you can see always in the historical data, that the trend is the negative trend intact and moving downwards here and here it's much lower. So for the criteria, the trend is sitting on the trendline.

And we are also want to see if we have upper trendline over here and there they are there. So what we can see is the We have here an intact negative trendline, which is followed by an intact negative trend up to this point where it gets higher again. So and we can use our software here. And then we can find the trend lines, and also the regression trend, which is a bit better for the trend funnel. So you're pointing to the first point of your trend after your last point and see what happened. So what you can see on this regression trend is also the funnels with an upper side and the lower side on your trending system.

And it's a bit more accurate and what you also can see Yes that we have the intact negative trend. Let's make this one again. So, we go for first point here. And so basically what you can see is that we have the trading the trending funnel, and this here is clearly negative trend. You can also make this bigger and see and a longer much more longer than negative trend. Which also three points there, there and there and with many points that we go into the lower or go on to the longer trend line but do not hit them.

If we want we could no we could not or could we could not. Okay, so it doesn't which complete for an and trending funnel because we have some points. This one, sort of we, we wouldn't like that you would see that my child is over the upper trendline and then there and break through here so this would wouldn't be enough for, for the trading for the trending funnel. Let's also look for this one and there would be no longer positive trend, we have two, three points. And if we would go over here, so we could see, this is a good example for a positive trend over a year, the chart is moving through the funnel. And this is a really good example here, what we could see is two trends positive and a negative.

And we have the main trend, which is clearly positive. Okay, from this point to here, we have an intact, positive trend on this side, and if we would go to, let's say one day range. You see this little bit better This is the hole from from July 2012. We have a positive, positive, intact trend. And now you can see that in in those very long intact positive trend, we have also the negative trends. And we have the long main trend and this side trends, so positive in the negative one.

So it's quite good example for you to understand how these trends are working and how you can, how you can work with them yourself. And if you also look with the regression trend, you see the same so we have the same points The chart is following the regression trend. So it's perfectly match in it. And that's the interesting thing on the trending theory, because because if you if you see that you have this trend on a daily or monthly basis, you could easily open positions in the main direction and if you securing your your contracts your trades, you can easily make the profit with them because the main direction is the trend and if you are with the trends you normally will earn something. However there are these points here. And here we have this this short, large short candle the red candles okay?

Where there are bad news, political news or bad market news or a huge company brings bad numbers on their earnings. Yeah, so that's that's things watch what I have an issue to the to the index. So this is the normally trend. And in the next videos we will see more about trends and trend following systems because there are some more and if you combine these trend following systems together, you have a really powerful tool to analyze, in which in which time point we are in the trend. And if we know that if we know this information, we are We are more intelligent as the market itself. You could say maybe like this, because you can, you can croak knows how the market will move in the next days, weeks month.

However, in which time index you calculate and in which time index, you're looking for the trends. So, really interesting thing, thing and for every trade of every child analyst, it's normal stuff to to look for trends and always make their trending lines. So I would say, after this lecture, you should go in your trading view, and look for some stocks that you read from and you will always have in the course list. Yeah, you Get a get a list from the companies where I look for charts and you can also look in the internet normally, and just go for the for the charts of them and try to find the trends because it's very necessary that you can easily find them. That's just just a thing of training. You need to train this because it's faster you are as fast to your finish your calculation and go tracked.

And yeah, in the next videos, we'll hear more about the trend following systems.