Downtrend refers to a long-term downward trend in the price of a financial instrument, such as a stock, commodity, or currency. During a downtrend, the price of the asset tends to make lower highs and lower lows over an extended period. Downtrends can occur in response to a variety of factors, such as economic weakness, political uncertainty, or changes in market sentiment. Investors who believe that an asset is in a downtrend may take a bearish view and sell the asset, or they may look to profit from the trend by short-selling the asset or buying put options.