Trending stocks are ones that are moving strongly in one direction whether up or down. 

Here are trending stock checklists:

Stocks in an uptrend:

  1. Making higher highs and higher lows. 
  2. Price is above key moving averages. 
  3. The chart has moving average crossover signals. 
  4. Price is near all time highs. 
  5. Price is near 52-week highs. 
  6. Volume is increasing with price. 
  7. Technical indicators are bullish. 
  8. Technical indicators are showing momentum to the upside. 
  9. Sentiment is bullish for the chart. 
  10. A breakout of a trading range to the upside. 
  11. High percentage gain in price on the chart. 
  12. High revenue and sales are projected for the company. 

Stocks in a downtrend:

  1. Making lower highs and lower lows. 
  2. Price is below key moving averages. 
  3. The chart has moving average crossunder signals. 
  4. Price is near all time lows. 
  5. Price is near 52-week lows. 
  6. Volume is increasing as price goes lower. 
  7. Technical indicators are bearish. 
  8. Technical indicators are showing momentum to the downside. 
  9. Sentiment is bearish for the chart. 
  10. A breakout of a trading range to the downside. 
  11. High percentage loss in price on the chart. 
  12. Low revenue and sales are projected for the company.

These parameters are time frame dependent for the trader or investor. A buy and hold investor will quantify a downtrend differently than a day trader. The more that a chart meets the above metrics the greater the strength of a trend is likely to be. 

“The answer to the question, What’s the trend? is the question What’s your timeframe?” – Richard Weissman 

Trending Stocks Checklist
Chart Courtesy of TrendSpider.com

By Steve Burns

After a lifelong fascination with financial markets, Steve began investing in 1993 and trading his accounts in 1995. It was love at first trade. After more than 30 successful years in the markets, Steve now dedicates his time to helping traders improve their psychology and profitability. New Trader U offers an extensive blog resource with more than 4,000 original articles, online courses, and best-selling books covering various topics.