Trend Following Explained by Tushar Chande

Learn the core concepts of trend following as explained by legendary technical analyst Tushar Chande. An essential introduction for traders.

Published · Updated · Methodology: Educational

Part of: Trend Following

  • Methodology: Educational
  • Content type: educational

Source video

Decoded from: Trend Following Explained by Tushar Chande by TrendSpider — watch the original

Strategy overview

Tushar Chande is one of the few names in trend following whose contributions are more measurement than method: the Aroon indicator, the Chande Momentum Oscillator, and the Variable Index Dynamic Average all came from the same question — how do you quantify whether a trend exists before you commit to it? This TrendSpider entry decodes his explanation of the concept, and the value is in hearing trend following described by someone who spent a career building the instruments that detect it rather than by someone selling a signal.

The framing matters for what you should expect here. Chande's public work has consistently treated trend following as a statistical problem — trend strength as a measurable quantity, adaptivity as a response to changing volatility, and system design as a question of what survives out of sample. That is a different conversation from the usual moving-average-crossover walkthrough, and it tends to spend its time on why a trend-following edge persists at all rather than on where to draw the arrows.

This entry indexes an educational segment: it is Chande explaining the approach, not a specification of a mechanical system, so there are no entry and exit rules on this page. Treat it as background for the reasoning behind trend-following design — the kind of context worth having before you evaluate any specific rule set that claims to implement it.

Topics

trend following · tushar chande · trading strategy · technical analysis · educational strategy · market trends · trading basics · swing trading · price action · tradingview strategy

Frequently asked questions

Who is Tushar Chande?

Tushar Chande is a quantitative trader and author known for developing technical indicators used in trend analysis, including the Aroon indicator, the Chande Momentum Oscillator, and the Variable Index Dynamic Average (VIDYA). His work focuses on measuring trend strength and adapting to changing market volatility.

What is trend following?

Trend following is an approach that aims to enter in the direction of an established price move and stay in it until evidence suggests the move has ended, rather than trying to predict tops and bottoms. It typically accepts a low win rate in exchange for a small number of large winning trades.

Does this entry contain a mechanical trend-following system?

No. This is an educational segment in which Chande explains the trend-following concept, so no entry rules, exit rules, or parameters were extracted from it. Use it as conceptual background rather than as a system specification.

Why does measuring trend strength matter in a trend-following system?

Because trend-following rules behave very differently in trending and ranging conditions. Indicators that quantify trend strength — the design problem much of Chande's work addresses — are used to judge whether conditions favor the approach before a directional rule is acted on.

About this strategy page

This trading strategy was decoded by Strategy Decoder's AI from a public YouTube trading video and turned into a structured, reviewable specification. In the interactive app this page shows the full entry and exit logic, risk management settings, the indicators involved with their parameters, AlgoWizard-compatible logic and a Pine Script export ready for TradingView backtesting — plus an automated backtest verdict when one has been computed for this strategy.

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