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VI. Charting

Charting is a form of technical analysis using a stock chart. It has a bit of controversy as some people do not believe in it, but it is something I use quite heavily. One reason I believe it works is that many major algorithms use the same pricing points you get from doing your resistance and support charting, thus you see large buy and sell orders go in the same time as you would . This creates greater price shifts the same direction as you would be going. The other is, that other regular traders use charting to gather their same pricing levels. Thus you also have them contributing to the price movement as well, further creating a swing in your direction. The key to this is getting the right timing and choosing your correct price point.

Resistance Level- This is also referred to as a ceiling, but is when a stock has reached its highest point multiple times at a certain price. The stock then hits this price and continues to keep selling off at this price, never breaching that level

Support Level- This is also referred to as the floor, but is when a stock falls to its lowest level multiple times at the same price point, and won’t go lower, thus creating a bottom pricing for a stock

Range- This is the values between the Resistance and Support level in which a stock fluctuates for a period of time, trading into this range will give you an average buy and sell price, ideally you keep buying at the support level and selling at the resistance price.

Break- When a stock finally breaks out of the range, you will likely see a large price movement. When this happens a stock will usually greatly move past the the ceilings and floors, and you will have to create new pricing points

Peaks and Double Peaks- This is a more advanced form of charting, but I just wanted to touch on it. After you have created your pricing levels above, you can then using peaks and double peaks to further day trade within. This are also good indicators of a possible stock break from the price range you created.

*include photos and examples

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