chapter 7 : Trend Analysis

2. Trend Break Detection

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Trend break detection is the process of identifying the point where a trend changes direction or behavior.

This could be:

  • Upward trend → downward trend

  • Stable trend → sudden growth

  • Slow growth → rapid decline

It helps detect:

  • Structural changes

  • Market shifts

  • Sudden events or anomalies

Example:
Sales increasing for months, then suddenly dropping after a new competitor enters the market.
What this shows:

  • The data follows a certain trend direction.

  • At a specific point, the pattern changes suddenly.

  • This change point is called a trend break.

Example:

  • Sales increasing steadily.

  • After a market crash, sales suddenly drop.

  • That drop point = trend break