What's an Example of a Down Trend? Identifying Down Trends in Gold Trading

A downwards trend in gold trading is the tendency of prices to move in a downwards direction for a period of time in a general direction downward.

Down Trends can be analyzed using downward trend lines.

Downward trendline analysis helps traders to define the downwards direction of the market. Down trendlines connect a series of price highs forming a sloping trend which represents the general downwards movement of the price.

For a downward sloping line this is known as an down trend - the trend-line drawn is known as an downwards trend-line.

Downwards Trend Line

A downwards trendline is drawn above pattern setup formed by consecutive lower highs, it must connect at least 2 highs, with recent most high being lower.

Since price moves down ward in a zig-zag manner traders normally draw a line which highlights the general downwards direction. In market analysis, this general direction is referred to as the Gold Trading TREND by traders. This down trend line is drawn on a chart showing the resistance levels (bearish trend market direction).

What's an Examples of a Down Trend? Identifying Downward Trends in Gold Trading

A down trend occurs when the price forms series of lower highs and lower lows. Each gold price high is lower than the previous price high - lower high: LH, & each xauusd price low is lower than the previous price low - lower low: LL therefore displaying bearish xauusd price movement.

Gold Trading down trend lines gain more validity every time price touches but does not penetrate the trend-line. A down trend remains the general direction til this series of lower price highs and lower price lows is broken - trend-line break reversal signal.