CRITERIA OF TREND

1) Trends and range bound markets are cyclical....after the strong trend expect the market to be range
bound before the trend resumes or the reversal takes place....excepion is V shape reversal which is rare in
any case. So after trend move, be ready for a sideways move and after sideways move be ready for a trend
move.

2) Volatility is also cyclical and mean reversing...so after volatile markets expect calm markets and after
calm markets the volatility is waiting to return...this is much more predictable than the price direction.

3) For we intraday and swing traders 3 trends exist on every timeframe....they are

Major Trend b) Visual Trend c) Short term trend....these 3 trends at any point are affecting the markets
and when all 3 trends are in phase, we get a trend move......once 1 or 2 of them get out of phase, we get
sideways moves..

4) First indication that sideways move is a about to come is when one higher degree trend fails to
make new high/low....we in daytrades trade short term trend...so when we see market is not making new
high/low in visual trend, we should expect sideways phase to set in..

5) In the initial period of sideways move the maket still trends ok.....but at later stage the market goes
flat....but by that time we know that it is entering a sideways phase....here too you will get a trend on
smaller timeframes....so in sideways move find out which timeframe gives us trends and trade that
timeframe.....market may not be trending on 15 min timeframe but it may be trending on 1 or 3 min
timeframes.But trading becomes tough in this period and the moves smaller..

6) In sideways markets the quantity automatically goes down as the supports/resistance do not get
broken and our adds are restricted.

7) In sideways market we need to trade on selling near the resistance and buying near the supports....I
have a few methods which I monitor in such phase....

Problem of sideways phase can be tackled in the above manner.....we cannot totally eliminate this
problem.....we have to live with it....that is the reason we should add and make maximum in trends so that
we can take these sideways periods in our strides………

Try the following...they might help you to improve your success rate and profitability :

8) Use a higher timeframe which should be about 5-6 times your trade timeframe for deciding the
direction in which you will take the trades. So if you are trading on 3 min bars, use 15-20 min bar as
higher timeframe to give you a trade setup. For 5 min bars the higher timeframe will be 20 or 30 min bar.
If higher timeframe is trending down, take all short trades...and vice versa