Trend Validation

Trend validation is the process of using secondary indicators, most commonly trading volume, to confirm that a price move is genuine. A trend without volume is often seen as a trap, while a trend with rising volume suggests high conviction.

Traders perform validation before committing large amounts of capital to a trend-following strategy. It helps them avoid false signals and provides a higher level of confidence in the underlying strength of the market move.

Using volume, momentum, and technical indicators, trend validation is a fundamental filter for professional risk management.