Higher High

A higher high is a swing peak on a price chart that is above the peak that came before it. In technical analysis, an uptrend is often defined as a series of higher highs together with higher lows, showing that buyers are pushing prices to new levels and stepping in sooner on each pullback. The idea goes back to Dow theory, based on Charles Dow's writings around 1900. Traders watch for each new higher high as confirmation that a trend is intact, often alongside rising trading volume. If price fails to make a higher high and then drops below the last higher low, many analysts take it as a warning that the trend may be turning; a new high that is not matched by momentum indicators such as the relative strength index is called a divergence. It describes past prices, not future ones. Also see trend analysis.