Invest brief · Fri Oct 23, 2026

Chart-lesson glossary

Lessons taught so far

L1 · Trend is a staircase (HH/HL vs LH/LL)

An uptrend is a series of higher swing highs and higher swing lows; a downtrend is lower highs and lower lows. Mixed swings = no trend.
Spot it: Find swing points: a bar whose high (low) is the highest (lowest) of the 5 bars on each side. Compare the last two swing highs and last two swing lows. HH + HL = uptrend; LH + LL = downtrend; anything else = mixed/sideways. Warning: first lower high after a run of HH. Break: a daily close under the last higher low.
Implies: Lower high = yellow light (stop treating dips as buys). Close under the last higher low = red light; wait for a new higher low and a reclaim of a recent swing high. · lesson page

L2 · Candle anatomy: body, wicks, close location

Body = open to close; wicks = prices that were rejected. Where the close lands inside the day's range shows who won the day.
Spot it: Close location = (close - low) / (high - low). Top 25% of the range = buyers won; bottom 25% = sellers won. Long wick = wick at least 50% of the day's range. Weight it by volume vs the 50-day average (>1.0x counts, light volume doesn't).
Implies: Use it as context only; check volume and the trend (Lesson 1) before trusting it. · lesson page

L3 · Weekend drill: spot the trend

Practice labelling charts up / down / sideways from the last two or three swings.
Spot it: Ignore the last few candles; use swings. The 21 EMA's slope usually agrees with the staircase.
Implies: Drill only, nothing to act on. · lesson page

L4 · Weekend review + quiz (L1-3)

Recap of trend staircase, candle anatomy and spotting the trend.
Implies: Review only, nothing to act on. · lesson page

L5 · Reversal candles in context (hammer, shooting star, engulfing)

A one-day reversal shape. Hammer: small body in the top third, lower wick at least 2x the body. Shooting star: mirror image. Engulfing: today's body fully covers yesterday's opposite-color body.
Spot it: Hammer: lower wick >= 2x body, close in top third of range. Shooting star: upper wick >= 2x body, close in bottom third. Bullish/bearish engulfing: opposite color to prior day, body covers prior body. Context: is it at a meaningful high/low? Volume above the 50-day average? Does the next day confirm?
Implies: Treat as a watchlist flag until the next session confirms (follows through) and volume backs it. · lesson page

L6 · Gaps: breakaway, runaway, exhaustion

A gap is empty space: today's low above yesterday's high (gap up) or today's high below yesterday's low (gap down). Breakaway leaves a base on heavy volume; runaway happens mid-trend; exhaustion comes late after a big run and fills fast; common gaps sit inside ranges and fill.
Spot it: Gap size >= 2% (open vs prior close) in the last 15 sessions. Volume >= 1.5x the prior 50-day average = meaningful. Breakaway: gap clears the prior 20-day high/low. Runaway: mid-trend. Exhaustion: after a +50% run in ~3 months. Filled = price trades back through the prior day's high (gap up) / low (gap down).
Implies: A breakaway/runaway gap that holds is strength; its lower edge is the level. A late gap that closes weak and fills fast = tighten up, don't add. · lesson page

L7 · Support & resistance basics

Support is a price zone where dips repeatedly got bought; resistance is a zone where rallies repeatedly stalled. Zones, not lines; at least two touches.
Spot it: Swing highs/lows in the last ~6 months clustered within ~1.5% of each other. At least 2 touches = a zone. Mark the nearest support below and nearest resistance above; within 3% of a zone = at an edge. A break = a daily close clearly beyond the zone, ideally on above-average volume, that holds.
Implies: Near support: stop can sit just under the zone (small risk). Jammed under resistance: little room. In the middle: wait. · lesson page

L8 · Role reversal (old resistance becomes support)

Once price closes through a ceiling and stays there, the same zone often becomes the floor on the next pullback (and a broken floor often becomes a ceiling).
Spot it: A zone with >= 2 swing-high touches (resistance) that later saw daily closes above it. Today's close within 0-4% above that zone = retest as support. Mirror: a floor (>= 2 swing-low touches) that broke, with price now 0-4% below it = test as resistance.
Implies: Wait for the pullback into the flipped zone on lighter volume and a close back up; stop just under the band. Decisive close back through = flip failed. · lesson page

L9 · Round numbers & prior highs

Prices like $100/$400 and prior highs attract selling and stalls. A round number is a zone, not a line; the first close through is the tell.
Spot it: Nearest round number (step scaled to price) within 2.5% of the close. Prior 52-week high within 3% of the close. Has price closed through it yet? On volume above average?
Implies: Avoid buying just under; wait for a close through on volume or a pullback that holds from above. Don't park stops exactly on the round number. · lesson page

L10 · Weekend drill: spot support & resistance

Practice finding the ceiling, the floor, and where price sits now.
Spot it: Zones a few dollars wide; >= 2 touches.
Implies: Drill only, nothing to act on. · lesson page

L11 · Weekend review (L5-10 on one chart)

Recap of reversal candles, gaps, S/R, role reversal, round numbers.
Implies: Review only, nothing to act on. · lesson page

L12 · Trendlines & channels done right

A trendline lays a ruler across Lesson 1's staircase: in an uptrend connect two rising swing lows (in a downtrend, falling highs). Two points draw it; a third touch that holds confirms it. A break means the trend changed character, not necessarily reversed.
Spot it: Anchor on the two most recent real swing lows where the second is higher (uptrend) or two falling swing highs (downtrend). No meaningful closes beyond the line between anchors; pokes under 1% are noise. Today's line value vs close: within 2% = at the line; close beyond it = break (judged on closes).
Implies: Buy interest belongs near a tested rising line, not at the channel top. A close under a steep line = stop adding, tighten up, redraw from structure. · lesson page

L13 · Ranges vs trends (when to sit out)

In a trend price stays on one side of a sloping 21 EMA; in a range the highs and lows repeat and price keeps crossing a flat 21 EMA. Trend tools get chopped up in ranges.
Spot it: Count closes crossing the 21 EMA over the last 60 sessions: <= 2 = trending; >= 6 = range-like. 21 EMA slope over 20 sessions: flat (|change| < 2%) supports range. Range box = highest high / lowest low of the last 60 sessions; middle third = no-trade zone.
Implies: In a range: trade only the edges or sit out; alert above the ceiling and wait for a close outside the box on volume, then a hold. Sitting out is a position. · lesson page

Terms

Swing high / swing low

A bar whose high (low) is the highest (lowest) of the 5 bars on each side. The building blocks of trends, zones and trendlines.

HH / HL / LH / LL

Higher high, higher low (uptrend steps); lower high, lower low (downtrend steps). Lesson 1.

21 EMA

21-day exponential moving average (ewm, adjust=False), the house line in the sand. Used here only to describe trend vs range (Lesson 13); the full MA unit starts at Lesson 16.

Close location

(close − low) ÷ (high − low). Near 100% = buyers won the day, near 0% = sellers won. Lesson 2.

Volume x (vs 50-day)

Today's volume divided by the prior 50-session average. 1.5–2x+ marks a meaningful gap or breakout (Lessons 6, 9).

Gap / gap fill

Today's whole range above yesterday's high (or below its low). Filled when price trades back to the prior day's high (low). Lesson 6.

Support / resistance zone

A band where at least two swing lows (highs) clustered within ~1.5%. A zone, not a line. Lesson 7.

Role reversal

A cleared ceiling acting as the next floor (or a broken floor acting as the next ceiling). Lesson 8.

Round number

Prices like $10, $50, $100, $400 (step scaled to price) where stalls cluster. Lesson 9.

Trendline / channel

A line through two real swing lows (highs); a third holding touch confirms it; a parallel line through the opposite extreme makes a channel. Breaks judged on closes. Lesson 12.

Range vs trend

Count 21-EMA crosses over 60 sessions: ≤2 trending, ≥6 with a flat 21 EMA = range. Middle of a range = no-trade zone. Lesson 13.

Confirm / invalidate

Confirm = what the next sessions must do for the lesson to play out; invalidate = the close that says it failed. Educational framing, not a trade instruction.