What Are the 6 Trends of the Stock Market?

Market Conditions & About Stock Market Participant Groups

Many Individual Investors view the market as having two trends, up or down. Stock and Options Retail Traders view the market as trending or non-trending. These are simplistic viewpoints based on outdated fundamental and technical theory dating back to the Dow Theory of the 1890s, when there were only 3 Stock Market Participant Groups and a completely different Market Structure.

The 6 trends of the Stock Market today are also known as the 6 Market Conditions that are formed from the current various 9 Stock Market Participant Groups based on which group or groups are in control of price.

Each trend has price action that is uniquely different and poses various opportunities as well as challenges for investing and trading. Short-term Trading Styles in particular are at risk for Technical Analysis mistakes if traders are unaware of how price behaves in the automated market.

To trade the market with the perspective of merely uptrends or downtrends will lead to losses, weaker stock pick selections, and chronic trading problems. In order to understand the far more complex diversity of price action in the automated marketplace, it is important to understand how the dynamics of each Stock Market Participant Group formulate the 6 distinct Market Conditions. This in turn creates the 6 trends of the Stock Market, which are distinctly different from each other.

The uptrend is not merely upward. The Angle of Ascent™ is what must also be taken into consideration in order to properly trade each Market Condition.

In addition, it is important to assess the duration and the width of sideways action and the effect of these on the long-term, intermediate-term, and short-term trends of the stock.

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Trade Wisely,

Martha Stokes CMT

Chartered Market Technician
Instructor & Developer of TechniTrader Stock & Option Courses

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