One thing I haven't considered in great details of the lifecycle or the stages of a trend. I thought it would be good to discuss the different stages, how to identify them and how to best trade them.
It would be good to post some charts with examples and to see how the stages of the trend appear in both short and long term timeframes.
Below is some information and a picture I found on a website. If you have anything better than this we can use that instead/in addition.
Stages of a Trend.jpg
Stage 1 (The beginning - the nascent trend)- When a reversal occurs and a new trend starts. The trend is just beginning and traders don't yet have confidence in the trend itself.
Stage 2 (The fully charged trend) - price movement is confident and there is little room for uncertainty about the direction of the trend itself.
Stage 3 (The aging trend) - The trend gets tired. Experienced traders lose confidence in the trend and inexperienced traders are still trying to jump in and grab some profits from the trend. The aging trend can be seen by stages of price consolidation and chart patterns.
Stage 4 (The end of the trend) - This is the point where experienced traders and long term traders are taking profits. The close of all these trades usually leads to a reversal.