The candle
Each candle encodes four numbers: open, high, low and close, over a chosen period. The body shows the battle's result, the wicks show the ground that was taken and lost. A long lower wick means buyers defended a level; a long upper wick means sellers rejected a price. That is the entire vocabulary, and it is enough.
Timeframes and context
Always read at least two timeframes. The higher one — daily or four-hour — gives direction and the levels that matter. The lower one — fifteen or five minutes — gives entry timing. Taking a long on the five-minute chart directly into daily resistance is the single most common beginner error.
Patterns that earn their reputation
Most chart patterns are folklore. A few describe genuine order-flow situations and repeat often enough to trade.
- Range breakout with volume expansion, ideally after a long compression.
- Retest of a broken level that now flips from resistance to support.
- Higher-low continuation inside an established trend.
- Failed breakout, where price sweeps a high, immediately reclaims the range and traps late buyers.
- Engulfing candle at a tested level, showing decisive rejection.
Volume and confirmation
Price without volume is an opinion. Breakouts on falling volume usually fail; breakdowns on surging volume usually continue. Wait for the close of the candle before acting on a pattern — intrabar excitement is where accounts die.
Technical analysis is not prediction. It is a framework for locating asymmetric spots where you risk one to make two or three, and where you know immediately when you are wrong.