RSI (Relative Strength Index): A momentum oscillator (0-100) measuring the speed and magnitude of recent price changes. Above 70 = overbought, below 30 = oversold. Standard period: 14. | MACD (Moving Average Convergence Divergence): A trend-following momentum indicator showing the relationship between two EMAs (12 and 26 period). The signal line is a 9-period EMA of the MACD line. Histogram = MACD line minus signal line. | EMA (Exponential Moving Average): A moving average that gives more weight to recent prices. More responsive than SMA. Formula weight = 2/(period+1). | SMA (Simple Moving Average): The arithmetic mean of prices over a specified period. 50-day and 200-day are most commonly referenced.
ATR (Average True Range): Measures volatility by calculating the average of true ranges over a period (typically 14). True Range = max of (High-Low, |High-Previous Close|, |Low-Previous Close|). Used for stop loss placement and position sizing. | ADX (Average Directional Index): Measures trend strength (0-100) regardless of direction. Below 20 = no trend, 25-40 = trending, above 40 = strong trend. Accompanied by +DI and -DI lines showing direction. | OBV (On-Balance Volume): A cumulative volume indicator that adds volume on up days and subtracts on down days. Rising OBV = accumulation; falling OBV = distribution.
Bollinger Bands: Three lines — middle band (20-period SMA), upper band (middle + 2 standard deviations), lower band (middle - 2 standard deviations). Bandwidth measures volatility. %B shows price position relative to bands. Squeeze = narrow bands (low volatility). | Stochastic Oscillator: Compares closing price to its range over a period. %K = fast line, %D = slow line (signal). Overbought above 80, oversold below 20. | Stochastic RSI: Applies the stochastic formula to RSI values instead of price. More sensitive than regular RSI.
Ichimoku Cloud (Ichimoku Kinko Hyo): Five-line system. Tenkan-sen = 9-period midpoint (conversion line). Kijun-sen = 26-period midpoint (base line). Senkou Span A = average of Tenkan and Kijun, plotted 26 ahead. Senkou Span B = 52-period midpoint, plotted 26 ahead. Chikou Span = close plotted 26 periods back. The cloud (kumo) = area between Span A and B. | Fibonacci Retracement: Key levels (23.6%, 38.2%, 50%, 61.8%, 78.6%) derived from the Fibonacci sequence, used to identify potential support/resistance during pullbacks. | Fibonacci Extension: Levels beyond 100% (127.2%, 161.8%, 200%, 261.8%) used for profit targets.
Pivot Points: Calculated support/resistance levels using previous period's High, Low, Close. Floor pivot: PP = (H+L+C)/3. Fibonacci pivots use Fibonacci ratios. Camarilla pivots use 1.1 multiplier for intraday reversal/breakout zones. | Moving Average Crossover: When a shorter MA crosses above a longer MA (bullish) or below (bearish). Golden Cross = 50-day SMA above 200-day SMA. Death Cross = 50-day below 200-day. | Rate of Change (ROC): Percentage change in price over a specified period. ROC = ((Current Price - Price N periods ago) / Price N periods ago) × 100.
Candlestick Terms — Doji: Open equals close, indicating indecision. Dragonfly Doji: Long lower shadow, bullish at bottom. Gravestone Doji: Long upper shadow, bearish at top. | Hammer: Small body at top, long lower shadow (2x body), appears after downtrend = bullish. | Hanging Man: Same shape as hammer but after uptrend = bearish. | Shooting Star: Small body at bottom, long upper shadow, after uptrend = bearish. | Engulfing: Two-candle pattern where the second body completely engulfs the first. Bullish engulfing = reversal from downtrend. Bearish engulfing = reversal from uptrend.
Harami: Two-candle pattern where the second body is contained within the first. Bullish harami = small bullish candle inside large bearish candle. | Morning Star: Three-candle bullish reversal — large bearish, small body (star), large bullish. Evening Star: Bearish version. | Three White Soldiers: Three consecutive large bullish candles = strong bullish continuation. Three Black Crows: Three consecutive large bearish candles = strong bearish continuation. | Chart Patterns — Head and Shoulders: Three peaks, middle highest. Neckline connects troughs. Break below neckline is bearish. Inverse H&S is bullish. | Double Top (M): Two equal highs, bearish. Double Bottom (W): Two equal lows, bullish.
Ascending Triangle: Flat resistance, rising support = bullish. Descending Triangle: Flat support, falling resistance = bearish. Symmetrical Triangle: Converging lines, no directional bias until breakout. | Flag: Small rectangular consolidation against the trend. Bull flag slopes down, bear flag slopes up. | Pennant: Small converging consolidation after a sharp move (flagpole). | Wedge: Both trendlines slope same direction. Rising wedge = bearish, falling wedge = bullish. | Cup and Handle: U-shaped cup followed by small handle consolidation = bullish continuation. | Support: Price level where buying interest prevents further decline. Resistance: Price level where selling interest prevents further advance. This is not financial advice.
This content is for educational purposes only and does not constitute financial advice. Always do your own research before making investment decisions.