Trend: free trading lesson

Step 1

Uptrend: higher highs, higher lows

Prices never move in a straight line. They move in waves: up, a little down, up again. In an uptrend every wave reaches a new peak, a higher high (HH), and every dip stops above the last dip, a higher low (HL). Buyers are stronger, so they keep paying more.

Step 2

Downtrend: lower highs, lower lows

The mirror image. In a downtrend every bounce stops below the last one, a lower high (LH), and every fall breaks a new low, a lower low (LL). Sellers are in control. Remember from lesson 1 that a falling market can be traded too, by selling first.

Step 3

Sideways: no trend at all

When the highs stop at about the same price and so do the lows, there is no trend: the market moves sideways, in a range between a floor and a ceiling. Markets spend a lot of time like this. It needs a different plan from a trend, and lesson 4 shows how to read the two edges.

Step 4

Pullbacks are part of a trend

A few red candles do not end an uptrend. A dip against the trend is called a pullback, and it is normal: some buyers take their profit, then new buyers step in. As long as the dip stops above the last low, the uptrend is intact. Many traders even wait for a pullback to join a trend at a better price.

The first pullback: price dips, but stops above the last low.
The second pullback, the same. Each one becomes a higher low.

Step 5

How a trend turns

Trends rarely end with one candle. They end in two steps. First the market fails to make a new high. Then it falls through the last higher low. Only after the second step has the uptrend really turned. Until then, it may just be a pullback.

The first warning: a lower high. Buyers could not reach a new peak.
The confirmation: price breaks below the last higher low. Now the lows are falling too.

Step 6

The app reads it with you

The AiTradely chart marks the turning points with the same labels, HH, HL, LH and LL, and the status line above the chart says whether the market is trending or ranging.

On this screenshot the app labels the last peak LH, a lower high, and the line at the top reads Range, near the floor: no trend on the daily chart right now. You learn the reasons here; the app saves you the counting.

Gold in AiTradely: the last peak labelled LH and a status line reading Range, near the floor — Gold, 1 hour chart, in the app on 20 October 2026 (cropped).

Watch out. A trend tells you which way the market has been going, not where it must go. Every trend ends one day, so a trade with the trend still needs a stop loss.

Words

New words in this lesson

Trend: The direction a market has been moving, read from its highs and lows.Like: the current of a river: you can swim against it, but it is harder.
Uptrend: Higher highs and higher lows.Like: climbing stairs: every step is above the last one.
Downtrend: Lower highs and lower lows.Like: walking down the same stairs.
Range: No trend: price moves sideways between a floor and a ceiling.Like: a lift going between two floors and back.
HH, HL, LH, LL: Higher high, higher low, lower high, lower low: the labels on turning points.Like: the marks on a door frame that show how a child grows each year.
Pullback: A short move against the trend that does not break it.Like: stepping back to take a run-up before a jump.

AI readAsk the AI which way the trend isUp, down or sideways on any market, with the highs and lows behind it.

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