Trend Shift Indicator

Definition ∞ A Trend Shift Indicator is a technical analysis tool or metric designed to identify when the prevailing direction of a digital asset’s price movement is likely to reverse or change course. This indicator signals potential alterations in market momentum. It assists traders in anticipating significant market turning points.
Context ∞ Traders employ trend shift indicators, such as moving average crossovers or divergence in oscillators, to anticipate market reversals and adjust their positions accordingly. Accurate identification of a trend shift can provide early entry or exit points, although false signals are common and typically require corroboration from other analytical methods to enhance reliability.