Technical Analysis

Matt Kanterman

Support and Resistance

Support and resistance levels are price levels on the price graph where the increase or decrease in price slows down or stalls alltogether. Support and resistance levels can be used to identify the short-term direction and potential price action of a security.

Support and Resistance

Support Level

Support and Resistance

Resistance Level

Support Can Equal Resistance

Trading Range

Trend Lines
Trend lines are lines that are drawn to show the general direction of a market or a security. Trend lines are more valid the more data points they encompass.
Therefore, the longer term the trend, the more valid it is.

Trend Lines

Trend Lines
Trend lines may ignore certain data points. A best-fit line, ignoring a small collection of data in a longer term chart, can still be valid even though it does not fit all data points.

Trend Lines

Common Chart Patterns

Head and Shoulders Outside Reversal Double Top/Bottom Wedge Flag/Pennant Triangle

Head and Shoulders Top

Head and Shoulders Bottom

Outside Reversal

Outside reversals occur when the price makes a new high and then closes at the lows. A close near the lows usually signals a similar bearish pattern.

Double Top

Double Bottom

Falling Wedge

Rising Wedge

Flag

Symmetrical Triangle

Ascending Triangle

Descending Triangle

Patterns
Aside from the recognizable and named patterns, there can be others. Examples include:
Cycles Fibonacci metrics

Perfect Cycle

Cycles
Cycles sometimes are more apparent when you change the scale. Switching from an arithmetic (normal counting scale) to a semi-logarithmic or logarithmic scale can make cycles more apparent.

Cycles

Cycles

Cycles
Cycles can also become more apparent by smoothing out price actions using moving averages. The cycles thus show themselves, as the market can in the very short-term become destabilized and re-stabilize in a few trading days.

Cycles

Cycles
There are other types of cycles too!!!
Calendar Random cycles such as the election cycle If you are interested, look up the Dow theory

Cycles

Cycles

Sell in May and go away!!

Fibonacci Retracements
The Fibonacci Series is 0, 1, 1, 2, 3, 5, 8, 13, 21, 34, 55, 89, 144, 233, 377, 610... If you divide one number by the next, the quotients converge to .618 or 61.8% If you divide one number by the second one after it, the quotients converge to .382, or 38.2% (or 1.618, which is weird and explained by chaos theory) If you divide one number by three after it, the quotients converge to .236 or 23.6%

Fibonacci Retracements

Fibonacci Arcs

Fibonacci Fans

Fibonacci Fans

Fibonacci Time Zones

Sources
http://stockcharts.com/school/doku.php?id=c hart_school:chart_analysis