Course 5 of 5 · Beginner · 10 min
Reading charts
What a candlestick records and hides, and how to mark the areas a market has stalled in before without covering the chart in lines.
Course overview
Description
A price chart is a record, not a forecast. This course teaches you to read one accurately and to stop there, which is a more useful skill than it sounds.
We start with the candlestick: four prices per period, what the body and the wicks show, and the one thing a candle cannot tell you — the order in which those prices were reached.
Then support, resistance and trend lines: how to mark them as zones rather than exact prices, why they break, and why a stop placed exactly on an obvious level sits where everyone else’s sits.
Lessons
Example lesson: what one candle leaves out
A candlestick holds four numbers from one period: the open, the high, the low and the close. The thick body runs between open and close; the thin wicks run out to the extremes.
What it does not record is sequence. A candle with long wicks on both sides could have risen first and then fallen, or the reverse — it looks identical either way. When the order matters, drop to a smaller timeframe.
Colour tells you which end of the body is the close. It is a setting, not information.
| One EUR/USD daily candle | |
|---|---|
| Open | 1.0850 |
| High | 1.0890 |
| Low | 1.0835 |
| Close | 1.0845 |
Check your understanding
3 questions. Nothing is recorded and nothing is sent anywhere — the answers are checked in your browser.
What does a candlestick record?
Four prices per period, and nothing else. Sequence is exactly what it hides.
Support and resistance are best marked as…
Price rarely turns twice at the same decimal. Ten pips on EUR/USD or twenty points on an index is a reasonable width.
A level has held four times. What does that tell you about the fifth?
More touches mean more attention, not more reliability. A heavily watched level is also where many stop orders sit.
Practise it before it costs anything
A demo account runs the same platform on the same live prices, with nothing at stake.
