A trend is the broad upward or downward movement of a stock’s price over time.
Upward movement is called an uptrend, while those which move lower over a period of time are said to be in a downtrend.
Investors have a tendency of buying stocks that are seemingly in an uptrend and selling the ones in a downtrend.
In an uptrend, both the peaks (tops) and troughs (bottoms) of a stock chart keep increasing successively. So, every day or so, the stock price touches a new high and falls lower than it did previously.
A downtrend is a pattern, where a stock is falling constantly. Not only are successive peaks lower, successive troughs are also lower. This means that investors in the market are convinced that the stock will fall further.
▶️ SIDEWAY TREND:
In a sideways trend, a stock doesn’t move notably in either direction during an extended period. Peaks and troughs continue to be constant and there is no significant move to decide whether to buy a stock or not.