The building blocks of an uptrend is a new high. If you don't see a new high in 5-bars, then you can start a downtrend from the highest high in the last 5-bars. If you go 5-bars without a new low, you can start a new uptrend from the lowest low of the past 5-bars. It really is that simple.
Once you get a new high, the recent downtrend has failed and you are in an uptrend. You can make calculations of how far the market will move based on how far the market traded around the "mode" or the "most frequent price" of the uptrend. Measure around the mode and project up from the mode. Once time and price targets have passed, then you can wait and see if another higher mode forms which can give you a new upside projection.
Once you see 20 bars at one price, the market is not operating at that time frame, so you go UP by 4x-6x (from daily to weekly, from weekly to monthly, from 65 minute charts to daily) to the next time frame.
There are very few additional rules to help you apply these "basic building block rules" for calculating trend.
We discuss charts with this analysis in mind in the chat room here called "KEY HIDDEN LEVELS"
What we see here in XAGUSD is that the current downtrend was close to failing at today's high. The last two sharp moves down created a "Range Expansion" bar where it declined by more than the previous bar's range, implying strong selling and more downside to come. But two times (see highlighted "Downside Range Exp FAILED" callout boxes on the chart) these downside moves failed to lead to follow through. So, there are 3 uptrends in place and 1 downtrend. If we go over the high, there will be 4 uptrends in place and no downtrends and the trend could accelerate. That is just a guess, but we are watching what is happening and see that the sellers are weak and the buyers are in control.
Follow this post to see how it pans out. Only time will tell.
12:43PM EST 10/23/2015 XAUUSD 15.831 last
I believe this market is ripe for a move based on the heavy monetary easing that has been expressed by Mario Draghi and also by China with their rate cut. And back in the USA, sentiment has swung from expecting a rate hike in 2015 to then seeing rate cuts overseas. Given that easing environment, it would be normal to expect a substantial rally from the precious metals here. Rallies in the metals that occur quickly do not tend to last, so I will just keep monitoring for low-risk entries.
If we keep analyzing the movements (the building blocks I have mentioned, which is how each range stacks up next the range before it) we can identify the lowest risk, highest reward opportunities.
All this is theory, based on how strong that range expansion is. Nothing like the previous legs.
You can trade consolidations and analyze individual legs with time at mode as well.