Trend

Business, Legal & Accounting Glossary

Definition: Trend



What is the dictionary definition of Trend?

Dictionary Definition


Trend is the general direction of a market or of the price of an asset.

  1. An inclination in a particular direction.
  2. A tendency.
  3. A fad or fashion style.

Full Definition of Trend


A trend is the overall general direction of movement in price (or other quantity) over a period of time. Trends may go up, down or sideways. They are important to investors, particularly those that use technical chart analysis to make trading and investing decisions. A trend may be spotted on a stock price chart simply by observing the general direction of prices on a stock chart. Another way to determine a trend is by drawing lines connecting the highest and/or lowest price peaks on a chart. If the lines drawn are higher on the right, that signals an uptrend; if they are lower on the right, prices are falling in a downtrend. If the lines appear to be flat, that is a sideways trend, meaning prices are stably staying in a range without much deviation. Some investors try to trade in the direction of the trend to minimize risk. These trend/following investors assume/believe that once prices begin to move in a trend, they tend to continue in that same direction. As an example, if prices are trending up (i.e. an uptrend), an investor might choose to enter a long position. If prices are trending down (i.e. a downtrend), that same investor might choose to open a short position.

Trends can vary in length from short, to intermediate, to long term. If you can identify a trend, it can be highly profitable, because you will be able to trade with the trend.

 


Cite Term


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Modern Language Association (MLA):
Trend. PayrollHeaven.com. Payroll & Accounting Heaven Ltd. July 04, 2020 https://payrollheaven.com/define/trend/.
Chicago Manual of Style (CMS):
Trend. PayrollHeaven.com. Payroll & Accounting Heaven Ltd. https://payrollheaven.com/define/trend/ (accessed: July 04, 2020).
American Psychological Association (APA):
Trend. PayrollHeaven.com. Retrieved July 04, 2020, from PayrollHeaven.com website: https://payrollheaven.com/define/trend/

Definition Sources


Definitions for Trend are sourced/syndicated and enhanced from:

  • A Dictionary of Economics (Oxford Quick Reference)
  • Oxford Dictionary Of Accounting
  • Oxford Dictionary Of Business & Management

This glossary post was last updated: 22nd March, 2020 | 1 Views.