Wyckoff tells us that the most important thing that anyone can know about the market or an individual issue is its trend. The trend is most simply defined as being the line of least resistance. Prices will tend to follow the line of least resistance until there is a significant development in the action that suggests that a change in trend should be anticipated. A trader can look at the price of a market or issue and compare it to the price from the previous day, week, month or year and determine the direction in which it is trending. While this can be helpful in keeping a trader on the right side of the action, Wyckoff had something more specific in mind for determining the trend. He provided guide lines as to the proper way to define a trend so that it could be more helpful in applying the five steps of the Wyckoff Method. Trends can be defined in three directions and in at least three time frames. There are up trends, down trends and horizontal trends normally referred to as trading ranges. Trends can be short term in nature, intermediate term or long term. The time frames that one Wyckoff trader uses to define the length of the trends may be different than another Wyckoff trader uses. This does not necessarily mean that one trader is correctly defining the trends and the other is incorrectly defining them. The important point is that the trends that are defined by consistent with the time frame of the market operation that is being undertaken. A short term trader may define the short term trend as being one that is defined and completed in just a few days. This trader may view intermediate term trends as being those that are defined and completed over several weeks and he may look at long term trends as those that last no more than a couple months. The intermediate term or longer term trader may see the short term traders idea of a long term trend as being his short term trend. These traders may look at intermediate trends as lasting for several months and long term trends as lasting a year and more. These traders cannot be faulted for the different time frames they use to define trends of different duration's. A problem only develops if a trader defines trends in one time frame, but then attempts to operate in a different time frame. This type of error can be fatal for a market operation.

An up trend in any time frame is defined by a demand line and an over bought line. A demand line connects the low points of two consecutive reactions of similar significance where the second reaction low is at a higher level than the first. Finding two reaction lows where the second is higher than the first is a simple matter. However, some Wyckoff traders who are new to the approach have difficulty with the idea of similar significance. Looking for reactions that last for approximately the same number of days or move the price approximately the same distance can be helpful in identifying reactions of similar significance. While Wyckoff would not necessarily frown on this approach, he would prefer that the trader identify two consecutive reaction lows that are both important points in the action. The most important points in the action for those looking for an up trend are the primary buying opportunities. Combining two of these to define the demand line of an up trend is seen as being the best approach.

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