Technical Analysis: The Complete Course

    The original technical analysis course: charts, trends, support and resistance, indicators, patterns, and how to use them alongside fundamentals.

    Types of Charts

    Different ways to visualize price action

    Line Chart

    Connects closing prices with a continuous line. Good for seeing the overall trend but misses intraday volatility (highs and lows).

    Bar Chart (OHLC)

    Shows Open, High, Low, and Close prices for each period using a vertical line and small horizontal ticks.

    Candlestick Chart

    The standard for traders. Uses "bodies" and "wicks" to clearly show the battle between buyers (bulls) and sellers (bears).

    Types of Trends

    Uptrend (Bullish)

    Sequence of Higher Highs (HH) and Higher Lows (HL).

    Strategy: Buy on dips (Higher Lows).

    Downtrend (Bearish)

    Sequence of Lower Highs (LH) and Lower Lows (LL).

    Strategy: Sell on rallies (Lower Highs).

    Sideways (Consolidation)

    Price moves within a horizontal range (Rectangle). No clear trend.

    Strategy: Buy support, Sell resistance.

    Professional Workflow Sequence

    1

    Define Strategy

    Trend-following or mean-reversion based on market environment

    2

    Identify Trend

    Uptrend (higher highs/lows), Downtrend (lower highs/lows), or Sideways

    3

    Support & Resistance

    Mark levels where price historically pauses or reverses

    4

    Chart Patterns

    Look for geometric shapes signaling reversals or continuations

    5

    Candlestick Patterns

    Short-term visual cues for immediate market sentiment

    6

    Confirm with Indicators

    Apply mathematical tools to validate price action signals

    7

    Risk Management

    Set entry/exit points, stop-losses, and position size

    8

    Backtest

    Validate strategy against historical data before live trading

    Chart Patterns (Structural Analysis)

    55+ specific patterns to predict market outcomes

    Head and Shoulders

    A peak (head) between two lower peaks (shoulders). A break below the "neckline" signals a reversal from bullish to bearish.

    Signal: Bearish Reversal

    Reliability: High when volume confirms

    Double Top / Double Bottom

    Price tests a resistance/support level twice and fails to break, signaling a trend change.

    Signal: Trend Reversal

    Double Top = Bearish, Double Bottom = Bullish

    Inverted Head & Shoulders

    Opposite of H&S. Three troughs with the middle one being the lowest (Head). A break above the neckline is a strong buy signal.

    Signal: Bullish Reversal

    Rounding Bottom

    "Saucer" shape showing gradual shift from sellers to buyers. Indicates long-term accumulation.

    Signal: Bullish Reversal

    Candlestick Analysis (Sentiment Analysis)

    Individual or groups of candles highlight market emotions

    Hammer & Inverted Hammer

    Bullish Reversal

    Hammer: Short body, long lower wick. Buyers push price up after sell-off.
    Inv. Hammer: Short body, long upper wick. Buyers testing higher levels.

    Found at Bottom of downtrend.

    Shooting Star & Hanging Man

    Bearish Reversal

    Shooting Star: Long upper wick. Sellers rejection.
    Hanging Man: Long lower wick but appears at top. Weakening bulls.

    Found at Top of uptrend.

    Bullish Engulfing

    Strong Buy

    Large green candle completely covers previous red candle. Shows total shift in control to buyers.

    Bearish Engulfing

    Strong Sell

    Large red candle completely covers previous green candle. Sellers overwhelm buyers.

    Morning Star

    Bullish Reversal

    3-Candle Pattern: Big Red → Small Body (Indecision) → Big Green.

    Evening Star

    Bearish Reversal

    3-Candle Pattern: Big Green → Small Body (Indecision) → Big Red.

    Technical Indicators (Mathematical Confirmation)

    Overlays on price charts & Oscillators plotted separately

    Simple Moving Average (SMA)

    The average price over a specific period (e.g., 50-day or 200-day).

    SMA = Σ(Prices) / n

    Exponential Moving Average (EMA)

    Similar to SMA but more responsive to recent price changes.

    Use: Better for short-term trading

    Bollinger Bands

    Lines plotted two standard deviations away from an SMA.

    Narrow bands: Low volatility

    Wide bands: High volatility

    Price at upper band: Overbought

    Fibonacci Retracement

    Horizontal lines indicating where support/resistance are likely to occur (23.6%, 38.2%, 50%, 61.8%).

    Golden Ratio: 61.8% is key reversal level.

    Drawn from Swing Low to Swing High.

    Risk Management Checklist

    Technical analysis fails without strict discipline

    Golden Rules

    • 1.Always trade with the trend, not against it
    • 2.Wait for confirmation - don't anticipate breakouts
    • 3.Volume confirms price movements
    • 4.Cut losses quickly, let winners run
    • 5.Backtest strategies before using real capital