Rising trend breaking upwards

Rising trends indicate that the company experiences positive development and increasing buy interest among investors.

A rising trend signals that the stock will continue to rise. Trends often last longer than investors think, and consequently many sell too soon. If you own a stock in a rising trend, you should normally keep it. Are you looking for new stocks to buy, you should consider buying stocks that are in rising trends.

A rising trend breaking upwards signals strongly increasing buy interest among investors. This can be initiated by fundamental aspects of the stock or via media or stock brokers focusing on the company, making more investors aware of it.

A break upward is often the start of a further rise, with an even steeper rate of increase than before.

Special circumstances

In some rare cases, especially if the trend has lasted for a long time and the volume is unusually high, a break upward can signal an end rally: everything looks positive and every investor wants in. This pushes the price up while the last investors buy into the stock. A price reduction after this, on high volume, is a clear warning of a negative reversal in the stock.

The main rule remains that a break upward through a rising trend is a positive signal.

In Investtech’s analyses, a stock in a rising trend and a stock that has broken upwards through a rising trend will both be equally positive, given they are otherwise identical.