TYPES OF TRENDS
1.Spike and channel. Every trend that you see has a spike and channel component to it. So, you see spike and channel trends every day at some point.
2.A trend from the open, in other words, from the very first bar or very first few bars of the day, the market trends for the rest of the day. That happens about once a week.
3.Trending trading range days, where the market is in a trading range, and then it breaks out, and then it forms another trading range. Sometimes it breaks out again and forms a third or fourth. They’re pretty common. Very clear ones occur a couple times a week.
4.Trend resumption day. For example, if the market sold off and then went sideways for four hours and then sold off again, that’s trend resumption. You get those, I have it down here, once a month. The textbook perfect ones are about once a month, but different versions of it are more common than that.
5.Broad channel trends, including broad wedges and stair patterns. In some form they occur maybe once a week.
6.A small pullback trend, where the trend is trending all day long and the pullbacks are tiny. The move is not going up very fast or going down in a bear trend, but the pullbacks are very, very small. This is the strongest type of trend, and you get it about once a month.
Every type of trend usually can be classified as another type as well, but usually one type of behavior is dominant. For example, every type of trend has at least one spike and channel in it, but if other characteristics are more prominent, I would classify it as another type and trade it like the other type.
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