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Technical Analysis & Chart Patterns

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Technical Analysis & Chart Patterns

Fibonacci Retracement

Horizontal levels drawn at set percentages of a prior price move, used to mark potential areas where a pullback may pause.

Retracement Level = High - (High - Low) x Ratio, where common ratios are 23.6%, 38.2%, 50%, 61.8% and 78.6% % Technical Analysis & Chart Patterns

Flag Pattern

A short, shallow consolidation in a small parallel channel that slopes against the direction of a sharp preceding move.

Test: a steep prior move, followed by a brief parallel-sided consolidation retracing only a small portion of it qualitative Technical Analysis & Chart Patterns

Gap

A discontinuity on a chart where a period's entire range lies away from the previous period's range, with no trading in between.

Gap % = (Current Open - Previous Close) / Previous Close x 100 % Technical Analysis & Chart Patterns

Gap Down

An opening price below the previous period's low, leaving an unfilled space on the chart.

Test: Current Open < Previous Low % Technical Analysis & Chart Patterns

Gap Up

An opening price above the previous period's high, leaving an unfilled space on the chart.

Test: Current Open > Previous High % Technical Analysis & Chart Patterns

Hammer

A candlestick with a small body near the top of its range and a long lower wick, appearing after a decline.

Test: Lower Wick is at least twice the Body, Upper Wick is minimal, and the candle follows a decline qualitative Technical Analysis & Chart Patterns

Hanging Man

A candlestick with a small body near the top of its range and a long lower wick, appearing after an advance.

Test: Lower Wick is at least twice the Body, Upper Wick is minimal, and the candle follows an advance qualitative Technical Analysis & Chart Patterns

Harami

A two-candle formation in which a small body sits entirely within the range of the preceding large body.

Test: current body's high and low both fall inside the previous candle's body qualitative Technical Analysis & Chart Patterns

Head and Shoulders

A formation of three peaks in which the middle peak is the highest and the outer two are roughly level, joined by a neckline through the…

Neckline = line through the two lows between the peaks; conventional measured move = Head Height above Neckline, projected down from the break qualitative Technical Analysis & Chart Patterns

Heikin-Ashi

A modified candlestick chart in which each period's values are averaged with the previous period's to smooth the series.

HA Close = (Open + High + Low + Close) / 4; HA Open = (Previous HA Open + Previous HA Close) / 2 ₹ Technical Analysis & Chart Patterns

Inverse Head and Shoulders

A formation of three troughs in which the middle trough is the lowest and the outer two are roughly level, joined by a neckline through the…

Neckline = line through the two highs between the troughs; conventional measured move = Head Depth below Neckline, projected up from the break qualitative Technical Analysis & Chart Patterns

Inverted Hammer

A candlestick with a small body near the bottom of its range and a long upper wick, appearing after a decline.

Test: Upper Wick is at least twice the Body, Lower Wick is minimal, and the candle follows a decline qualitative Technical Analysis & Chart Patterns

Island Reversal

A cluster of periods isolated on both sides by gaps in opposite directions, leaving it detached from the surrounding chart.

Test: a gap in one direction, one or more periods of trading, then a gap back in the opposite direction, with the two gaps overlapping in price qualitative Technical Analysis & Chart Patterns

Line Chart

A chart that joins each period's closing price with a continuous line, discarding the open, high and low.

Test: exactly one value per period, conventionally the close, is plotted and connected qualitative Technical Analysis & Chart Patterns

Marubozu

A candlestick with no wicks, where the open and close are the period's extremes.

Test: Open equals either the High or the Low, and Close equals the other, so both wicks are zero or negligible qualitative Technical Analysis & Chart Patterns

Morning Star

A three-candle formation of a large falling candle, a small-bodied candle, then a large rising candle closing well into the first body.

Test: candle 1 falls strongly; candle 2 has a small body below it; candle 3 rises and closes above the midpoint of candle 1's body qualitative Technical Analysis & Chart Patterns

Open, High, Low, Close

The four prices that summarise a trading period: the first trade, the highest, the lowest and the last.

Range = High - Low; Change = Close - Open; True Range also considers the previous Close ₹ Technical Analysis & Chart Patterns

Pennant

A short converging consolidation following a sharp move, forming a small symmetrical triangle.

Test: a steep prior move, followed by a brief consolidation whose upper and lower boundaries converge qualitative Technical Analysis & Chart Patterns

Piercing Pattern

A two-candle formation in which a rising candle opens below the prior falling candle's close and closes above its midpoint.

Test: previous candle falls; current Open < previous Low; current Close > midpoint of previous body but below its Open qualitative Technical Analysis & Chart Patterns

Pivot Point

A reference price computed from the previous period's high, low and close, with support and resistance levels derived from it.

Pivot P = (High + Low + Close) / 3; R1 = 2P - Low; S1 = 2P - High; R2 = P + (High - Low); S2 = P - (High - Low) ₹ Technical Analysis & Chart Patterns

Point and Figure Chart

A chart that plots columns of Xs and Os for price movement of a set size, ignoring time entirely.

New X or O is added each time price moves one box size; a reversal requires a move of the reversal amount, typically three boxes ₹ Technical Analysis & Chart Patterns

Price Action

The analysis of raw price movement itself, without indicators derived from it.

Test: the reading uses only the sequence of highs, lows, opens and closes, with no calculated overlay qualitative Technical Analysis & Chart Patterns

Pullback

A temporary move against the prevailing direction within an ongoing trend.

Test: price retraces a portion of the prior move without violating the swing point that defines the trend qualitative Technical Analysis & Chart Patterns

Rectangle Pattern

A consolidation bounded by roughly horizontal support and resistance, with price oscillating between them.

Test: two or more highs at approximately one level and two or more lows at approximately another, with no convergence qualitative