Trend Trader/Trading

Trend trading is a strategy where traders attempt to capitalize on the momentum of an asset’s price movement by identifying and following trends. Trend traders buy assets during upward trends and sell during downward trends, using technical indicators like moving averages and trend lines to determine entry and exit points. The strategy assumes that price movements tend to continue in the same direction rather than reversing abruptly.

Example

A trend trader buys a stock that has been steadily rising over several weeks and sells when the stock begins to show signs of a reversal, aiming to profit from the established trend.