Detecting Crypto Trends from Consecutive Higher Highs and Lows

Summary

This article describes a daily trend indicator that classifies a bull trend when both highs and lows rise consecutively, and a bear trend when both fall. It uses completed daily bars to avoid decisions based on unfinished data and requires at least three consecutive days for confirmation. The implementation tracks trend state separately for each currency, records qualifying patterns, and estimates a period’s return from its beginning to its end. The method is presented as a way to quantify price structure and compare trend behavior across crypto assets.

The article reports historical results for BTC, ETH, and BNB, including the latest ten identified periods for each and descriptive averages for duration and returns. These examples show that the detector finds short periods with varied outcomes, including a nominal bull period with a slightly negative return. The evidence is descriptive rather than a trading-system evaluation: no entry and exit rules, costs, benchmark, or risk-adjusted results are supplied. The findings rely on a small recent sample, and the stated start-to-end return calculation may not represent a realizable strategy return.

Key ideas

• A bull trend is identified by consecutive increases in both daily highs and lows.
• A bear trend is identified by consecutive decreases in both daily highs and lows.
• The method uses complete daily bars and a minimum three-day confirmation period.
• Reported examples cover BTC, ETH, and BNB and show differing trend frequencies and returns.
• Trend classification and start-to-end returns do not by themselves demonstrate a profitable trading strategy.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.