Reading price action, indicators, and chart patterns.
ATR — the Average True Range — measures volatility as a single number: the average size of a market's recent price range, including gaps. This article explains 'true range' and why it captures more than the high-minus-low, how ATR is averaged over a lookback, what a rising or falling ATR tells you, and how ATR is used to gauge what counts as a 'normal move' and to scale stops and position size to volatility. It stresses that ATR measures size, never direction.
Bollinger Bands wrap a moving average in an envelope set a number of standard deviations above and below it, so the bands widen when volatility rises and contract when it falls. This article explains how the bands are built, what the width tells you (the 'squeeze' and expansion), why touching a band is not overbought or oversold, and how the bands describe volatility and relative price — never predict direction. It is explicit that 'walking the band' is normal in strong trends.
An engulfing pattern is a two-candle pattern in which the second candle's body completely engulfs the first's, marking a decisive one-period shift of control. This article explains the bullish engulfing (after a decline) and bearish engulfing (after a rally), the takeover story each tells, why an engulfing carries more weight than a single candle, the role of context and volume, and why — like every candlestick pattern — it describes a shift rather than predicting one.
MACD (Moving Average Convergence Divergence) is a momentum and trend indicator built from two moving averages. This article explains its three parts — the MACD line (the gap between a fast and slow EMA), the signal line, and the histogram — and how they are read: the zero line, signal-line crossovers, and MACD divergence. Because it is built from moving averages, MACD inherits their lag, so it is framed throughout as a descriptive lens on momentum, not a forecasting signal.
A reversal is a genuine change in a market's prevailing direction — an uptrend becoming a downtrend, or vice versa. This article defines a trend structurally (higher highs and higher lows, or lower highs and lower lows), shows how a reversal is the breaking of that sequence, and tackles the hardest problem in all of price action: telling a real reversal from an ordinary pullback. It closes on why reversals are only ever confirmed in hindsight, and why 'catching' them is where so many go wrong.
The Relative Strength Index (RSI) is a momentum oscillator that measures the speed and size of recent price changes on a 0–100 scale. This article explains what RSI actually measures, the meaning (and frequent misuse) of the 70/30 overbought and oversold thresholds, the centreline at 50, and RSI divergence — where momentum and price disagree. It is emphatic that overbought is not a sell instruction and oversold is not a buy one: in strong trends RSI can stay pinned at an extreme for a long time.
A shooting star is the mirror of the hammer: a single candle with a small body near the bottom and a long upper wick, appearing after a rally — a picture of buyers driving price up within the period and sellers rejecting those highs to close back near the open. This article covers its anatomy and story, why its uptrend context matters, how it relates to the inverted hammer and gravestone doji, and why, like every candle, it describes one period and needs confirmation.
VWAP — the Volume-Weighted Average Price — is the average price at which something has traded over a period, weighted by how much volume traded at each price. This article explains what VWAP measures and how it differs from an ordinary moving average, why it resets each session, how it is used as a benchmark of the 'average price paid' and as a reference for whether price is rich or cheap relative to the day, and why — like every indicator — it describes participation rather than predicting direction.
A breakout is the moment price moves decisively beyond a support or resistance area or a trendline, resolving a period of balance. This article explains what counts as a breakout (a close through the zone, not a passing wick), the role of volume and the retest, why broken levels flip role by polarity, and — crucially — the false breakout: why price so often pokes through a level and snaps straight back, and why a breakout is an event to observe rather than an instruction to act.
A hammer is a single candle with a small body near the top and a long lower wick, appearing after a decline — a picture of sellers driving price down within the period and buyers rejecting those lows to close back near the open. This article explains the hammer's anatomy and the tug-of-war it records, the importance of its downtrend context, its relatives (the hanging man and inverted hammer), and why a hammer is a description needing confirmation, not a reversal signal on its own.
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