Glossary / Trend & momentum

Trend

A trend describes the direction price has generally travelled over an extended window, and how consistently it has travelled that way. It is a statement about a period of price history rather than about any single session.

How it is measured

How is trend measured?

The two common approaches are a price change over a multi-month lookback, and the position of the current price inside a longer high-to-low range. Chart-based methods add moving averages or successive highs and lows, but every method reduces to arithmetic on prices that have already printed.

Why it matters

Why does trend matter to a swing trader?

Trend is the longest-memory of the common measurements, which makes it the steadiest and the slowest. Swing traders use it as context for shorter signals: the same short-horizon reading means something different inside a multi-month advance than inside a multi-month decline. Because it is backward-looking by construction, a trend reading is a description of the past and carries no information about valuation, solvency, or what the company does.

In Tapeline

Does Tapeline use trend?

Trend counts for more than any other factor in the Tapeline composite. It reads a multi-month price change and where the latest price sits inside the ticker's own 52-week range.

Read what the Trendfactor measures →

Tapeline publishes the six factor names and the ordering of their weights. The numeric weights, the scoring equation and the band edges are not published.

Related

See this in the product

What the Trend factor measures · The Trend factor · Full methodology

Related terms

Momentum
Momentum describes the speed and persistence of a security's recent price movement.
Moving average
A moving average is the average closing price of a security over a fixed number of recent sessions, recalculated each session so the window rolls forward.
DMA stack
A DMA stack describes a chart where several day-moving averages of different lengths sit in order — the shortest above the next-shortest, and so on down to the longest.
Relative strength
Relative strength is a difference, not a standalone reading: a security's price change over a period, minus a benchmark's price change over exactly the same period.

Back to the full glossary.

General information about market vocabulary, written to be descriptive rather than prescriptive. Not investment advice — see the risk disclosure.