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If you are new to the market,reading the stock market signals to spot a trend can be a little confusing but if you are serious about following the direction of the stock market, it may be wise to learn a little about spotting trends and when to act on them.
Taking note of volume and price will tell you if there are more buyers or sellers in the market.
Volume will tell you how much movement there is in the market. How many sales have gone through on each trading day is the volume indicator. You can get this indicator from many online stock market sites.
Price refers to the price of the indices (such as the Dow, NASDAQ, Hang Seng, Nikkei, etc) and tells you in which direction the market has moved. So if you put the price and volume together it will give you an indication of the market trend. For example, if prices are up and it is a high-volume day it is a sign of an up-market trend. If, however the volume is up but prices are down, then a downward trend is happening.
Obviously you can’t just look at the market on one day and expect to read the trend. You need to watch it over a period of time to get a feel that it is a genuine swing in the market. If you see a number of down days in an upward moving market, then you may feel the trend is about to reverse. Beware a market that has sharp price movements in either direction without the same volume increases. This market is sending fictitious messages. Watch it carefully. If you see diversion from the current trend, prepare for a change in the market.
Calculating moving averages is another way to spot trends in the market. These are the most widely used technical indicators. A moving average you is the average closing price of a stock calculated over a specific period of time. For example, the 50-day moving average is the average closing price over the last 50 market days. If the stock price is above its moving average, the market is in an uptrend and if it is below, then the market is in a downward swing. There are 50-day and 200-day moving averages calculated for long and short term trends.
Price channels are another tool used for spotting market trends. They can help indicate stocks that appear to be moving up but are still trapped in a downward trend, or those that are fixed in a flat trading range. Price channels can also indicate stocks that staging a true rally. A price channel is bordered by the stock’s high and lows, thus the name ‘channel’. Most online services have tools that can help you calculate these indicators. Price channels are most helpful to investment traders.
Use these indicator tools to help spot market trends. They are not foolproof but will offer some support when trying to work out what the market is doing. They may help take some of the fear out of investing in the stock market. | 
