Definition of Downtrend





What does the term "downtrend" mean in the world of investing? What is meant by a "downtrend"?

In investing, a "downtrend" occurs when the value of an asset (stock, real estate, gold, etc) declines over a period of time.

Definition of the term Downtrend - Financial Dictionary - Stock MarketFor instance - let's say that Microsoft ends the year at $40.50. Over the next 12 months, shares of Microsoft slowly decline to $33 per share.

Shares of Microsoft are said to be in a "downtrend" as they have slowly moved in one direction (down) over a sustained period of time.

The opposite of a downtrend, obviously, is an uptrend. If shares of Microsoft had slowly moved higher instead of lower, they would have been in an "uptrend".




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