Retracements and reversal

[Battle Axe]

As a 'fresh' starter, you may have been confused whenever you hear about retracements or reversals.

Or maybe you always mix them up.

Well, I'll explain to you in simple terms.

Reversal is simply a change in trend direction.

What do I mean?
If you are in an UPTREND market and after a while the market begins a heavy downwards move.

Then, that's probably a reversal.

Simply, if UPTREND changes to DOWNTREND or DOWNTREND changes to UPTREND. That's a reversal.

Now, retracements are just temporary or short reversals that occur during a trend.

For example;
if you're trading on an UPTREND market and after a while, a short downwards occurs, followed by a change in direction back to the original upwards move. That's a retracement move.

I hope this helps you understand better.

Let me know in the comments if this is new to you as a fresh trader. Or you could add to this for others.

Thanks.
Feel free to drop questions.