How are market uptrends and downtrends identified?

A market uptrend is when prices go up over time, and a downtrend is when they go down, like watching your favorite candy bar get more expensive or cheaper.

Imagine you're on a roller coaster. When the ride goes up, that's an uptrend, everyone is excited! The price of the candy bar keeps rising, just like the roller coaster climbing higher and higher.

Now, when the roller coaster drops, that's a downtrend, people might scream, but it’s fun too! The candy bar gets cheaper, like you're getting more for your money.

To know if there's an uptrend, we look at how often prices go up. If they rise most of the time, that's a trend! For a downtrend, we check how often prices fall, if they drop most of the time, then it’s going down.

It's like counting your steps every day. If you take more steps than usual, you're moving forward, that's an uptrend. If you're taking fewer steps, you're slowing down, that's a downtrend.