Log In    |    Join for FREE
Unlock Full Access
DaytradingBias on Facebook DaytradingBias on Google+ Follow DaytradingBias on Twitter

Art of Chart Reading Online: Learn to Read Any Market the Right Way


Written by Lawrence Chan. Copyright © 2011-14 All Rights Reserved

Art of Chart Reading Online provides the best online lessons on learning and applying chart reading techniques to profit from any financial markets. The roadmap style approach to chart patterns is both easier to understand and more efficient to apply. Great for day trading and swing trading in stock markets, emini and forex.

If you ever want to make money from trading, you should start studying the lessons now. Here you will find:
  • Chart reading lessons you wish you have learned from day one
  • Effectiveness of price patterns confirmed by original research
  • Fill in the missing pieces hindering your performance
  • Correct your bad habits in chart reading
  • Build a solid foundation for your trading career


Art of Chart Reading is going to be published soon. For more news about the project and sample chapters, please visit Art of Chart Reading home site.

Since majority of the actual content of the book cannot be accessible freely anywhere according to Amazon’s guideline, the original individual chapters posted here will only be accessible by premium members going forward. Sorry for the inconvenience.

To read the member-only lessons, sign up for free

To access premium lessons, become our premium member now

sponsor message (ad free for all members)


Introduction



Introduction to Chart Reading

Two opposing views on chart reading dominate the trading world and the public in general. Many people think that price charts are just fancy presentations of historical price data that has no real analytical value. Others take chart reading seriously ...

No comment yet


Trading with Probabilistic Mindset  premium content

Many people have weaknesses in decision making related to matters that are probabilistic in nature. Trading is exactly the kind of activity that requires many probabilistic decision making. Trading decisions are complex in nature because future of th ...

5 comments


iStock_000016397279XSmall
Stop the Madness – Stop Asking for Guru Opinions Whether Something is a Buy or Sell  premium content

Part of Art of Chart Reading Many people likes the comfort of guru opinions, especially when that opinion agrees with their own. When the guru opinion, even if it is a great one, when reduced to a buy or sell, will loose most of its meaning and li ...

4 comments


medical check up
Can I Still Make Money Trading When Markets Are So Manipulated  premium content

Part of Art of Chart Reading One of the most common beliefs among non-traders is that due to the excessive amount of corruptions and manipulations at the top it is not possible to make money trading the financial markets. There are also traders with ...

No comment yet


iStock_000008618958XSmall
Trade As A Chart Trader  premium content

Part of Art of Chart Reading Many people need an identity to anchor their minds. There is also a practical need because of social pressure. Pretty much like the security blanket Linus has in Peanuts (the comic strip), identity is not necessary but ...

One comment


one way
How To Read Your Charts Objectively  premium content

Part of Art of Chart Reading All the Key Things To Remember I listed in the Introduction is about one thing - reading your charts objectively. By detaching your emotions from reading your charts, many problematic issues related to chart reading ca ...

No comment yet



sponsor message (ad free for all members)


Structure Of Price Movements



Price Moves Like We Breathe  premium content

Part of Art of Chart Reading The basic types of price movements are just contraction and expansion. It is similar to how we breathe. It cannot be simpler. Contraction Is Decision Time Contraction is price movement trapped with lim ...

No comment yet


Classes of Chart Patterns  premium content

Part of Art of Chart Reading Recognition of chart patterns is for the purpose of assisting us to make unbiased judgement on what is likely to happen after the chart patterns are in place. In general chart patterns can be classified into 3 basic clas ...

No comment yet


iStock_000014882807XSmall
The Minimalist Approach To Chart Patterns  premium content

Part of Art of Chart Reading There are chart readers who use many patterns. They use so many patterns you have to wonder if it is feasible to recognize them all. Of course one can computerize the patterns and automate the recognitions. But for nor ...

No comment yet


iStock_000012693751XSmall
Complex Chart Patterns Are Just Combinations Of The Simpler Ones  premium content

Part of Art of Chart Reading Many traders are obsessed with the idea that there exists secret uber chart patterns that produce superior returns with virtually no risk involved. If you are one of them, you should reread what I have written from the ...

5 comments




Trend And Trend Lines



Swing Trend Example_20121212_173357
Swing Highs And Swing Lows  premium content

Part of Art of Chart Reading The terms swing high and swing low often show up in all kinds of technical analysis discussions. They are simply the local extremes that are visible to us in a particular timeframe. It is not difficult at all to recogn ...

No comment yet


Swing Trend Example 2_20121213_174625
Classic Definition Of A Trend  premium content

Part of Art of Chart Reading The concept of trend has be a very controversial topic for years ever since the first generation technical traders from early 1900s introduced the idea. I will present the one that I was taught and how to utilize the c ...

No comment yet


Other Trend Identification Methods  premium content

Part of Art of Chart Reading There are many trend identification methods other than swing trend. The number of trend definitions exploded in the late 1990s as that was the time where every person with a personal computer can play with historical p ...

No comment yet


woman in depression
The Psychological Effects Of Swing Extremes  premium content

Part of Art of Chart Reading The Pursuit Of More Timely Trend Identification I started my chart reading education with the swing trend definition because that was the one that my mentors use. It works great back then and works even better nowaday ...

No comment yet


Water bubble and waves
Trend and Trend Quality  premium content

Part of Art of Chart Reading Trend has been one of the more elusive concepts in not just chart reading but trading in general. The swing trend definition I have provided is just one of the many ways to filter the price data into a structured view of ...

No comment yet


image
Before There Were Chart Patterns There Were Trend Lines  premium content

Part of Art of Chart Reading Chart patterns are combinations of price swings that exhibit consistency in their expected outcomes. Before the discovery of the various useful chart patterns, trend lines were the dominating technique for chart traders. ...

9 comments


AUDUSD Trend Lines_20130613_143203
You May See Only One Trend Line But There Are Many  premium content

Part of Art of Chart Reading Many chart readers rejecting the concept of trend lines because the drawing of trend lines is pretty arbitrary. Worse yet some technicians will sworn by their specific trend lines as if these lines have magical powers ...

No comment yet


image
Breaking Of A Trend Line  premium content

Part of Art of Chart Reading Once a trend line is broken in the opposite direction, it signals the potential start of a new trend. To be able to utilize the setup, you need to know the projected target of the trend line break. Classic trend line bre ...

One comment




Basic Patterns



Essential Chart Patterns  premium content

Part of Art of Chart Reading Here is the core set of chart patterns I find essential to get a grip of any markets I follow. Each pattern that has an article written to explain how it works will be linked to the article. Not Just Another Site w ...

No comment yet


ES Price Pattern 1-2-3_20120317_131103
1-2-3 - The Foundation of Potential Change in Trend  premium content

Part of Art of Chart Reading Summary If there is only one chart pattern you are allowed to learn, 1-2-3 is the one. 1-2-3 is often a reversal pattern that marks the termination of a trend. The pattern is made up of 3 swings where the first and ...

4 comments


ES Double Top
Double Top  premium content

Part of Art of Chart Reading Summary Classic technical price pattern featuring 2 swing tops that stopped at almost exactly the same price. Once the neckline is breached to the downside with the neckline turning into resistance, you ...

No comment yet


Price Pattern Euro 2
Wyckoff Up Thrust / UpThrust  premium content

Part of Art of Chart Reading Summary Wyckoff Up Thrust (a.k.a. Wyckoff thrust, w. thrust) is a terminal pattern for an uptrend. It is not a type of false breakout. It is not double top or other classic topping formations. Wyckoff Up Thrust is uni ...

5 comments


DSC00463
Bear Flag  premium content

Part of Art of Chart Reading Summary Bear flag is one of the most common price patterns appearing in charts of all timeframes. Bear flag is a continuation pattern in a downtrend. It is useful to identify the pattern early in its de ...

4 comments


Channels_20121127_124835
Channels  premium content

Part of Art of Chart Reading Channels is an interesting structural behaviour with non-random price movements. With purely random generated data series, channels rarely show up. It is one of the most important evidence that real market data are not ...

4 comments


image
Measured Move (a.k.a. 1-to-1 Swing, ABCD Move)  premium content

Part of Art of Chart Reading Summary Measured move is a name given to a highly structured price movement that consists of 2 swings in the same direction with a pause in-between. The 2 swings are supposed to be very similar to each other, meaning ...

One comment


Rising and Falling Wedges_20121126_210528
Rising and Falling Wedges  premium content

Part of Art of Chart Reading Rising and falling wedges are chart patterns leading to violent breakouts. Most of the time, the breakout direction is opposite to the direction of the wedge. Hence, they are often named as reversal patterns although t ...

No comment yet


Rising and Falling Wedges_20121126_221112
Pockets  premium content

Part of Art of Chart Reading Pockets have a very special position within the core set of chart patterns. Unlike any other chart patterns, pockets are not defined by what is being there but what is missing. Pockets are very powerful price magnets o ...

No comment yet




Complex Patterns



Head and Shoulders, Not The Shampoo  premium content

Part of Art of Chart Reading People often talks about the head and shoulders formation. I have seen many websites showcasing charts after charts that are NOT head and shoulders at all, although they claim so. It is not a good idea mixing up price ...

No comment yet


image
Three Pushes  premium content

Part of Art of Chart Reading Summary Three Pushes is one of the more reliable chart patterns that work very well across almost all financial instruments. The pattern is easily recognizable and many of its formations can be computerized, making it ...

10 comments


Spike and Ledge chart pattern. DaytradingBias.com
Spike And Ledge  premium content

Part of Art of Chart Reading Summary Spike and ledge is a terminal pattern that happens more often in indices and post news shock environment. The concept is simple and easy to follow. It is one of the best short term trading patterns in terms of r ...

No comment yet


False Breakout - The Most Misunderstood Pattern  premium content

Part of Art of Chart Reading Traders often focus on how accurate certain chart patterns are and how much money you can make from using the patterns. The more experienced ones would add to their consideration of the risk reward profile of the pattern ...

No comment yet


Parabolic Run_20130707_042340
Parabolic Run  premium content

Part of Art of Chart Reading Parabolic Run is a complex chart pattern that classic chart patterns often fail to capture. Example Chart Following is a British Pound / US Dollar hourly chart. 1. The Trend Starter (the move in the b ...

No comment yet




Multiple Timeframes Principles



iStock_000010552687XSmall
A Trend Is Not Over Until It Is Over  premium content

Part of Art of Chart Reading One of the beginners' mistakes in chart reading is seeing top and bottom in the making everywhere. It happens when you learn to read a chart without a proper framework in mind. It is important to read the charts with cer ...

10 comments


Plan do check act circle
Price Discovery Cycle  premium content

Part of Art of Chart Reading Price discovery is the process of buyers and sellers interacting at the marketplace to determine the price of an asset. If this sounds like ancient Greek or Latin to you, don't worry it is absolutely normal because it is ...

11 comments


Strategy
Multiple Timeframes Bootstrapping Technique  premium content

Part of Art of Chart Reading Being able to read your charts proficiently using multiple timeframes to improve your decision making is similar to graduating from secondary school (or middle school). After completing secondary school, you are supposed ...

9 comments


iStock_000010610985XSmall
Differences Between Intraday and End-of-Day Charts  premium content

Part of Art of Chart Reading Price movements from different markets do not behave the same way. They all have different characteristics. The lesser known fact, however, is that price movements for a single market can behave totally different from ...

No comment yet




Applying Chart Reading



image
From Chart Reading To Trading  premium content

Many people confuse the analysis of the price charts and the projections on the potential outcomes with the act of trading or investing. Chart reading is just a tool to assist us in making our trading decisions. However, chart reading itself is inade ...

No comment yet


baby learn alphabet
Secrets In Applying Chart Reading Correctly To Day Trading  premium content

Due to the many limitations day trading has, a day trader cannot apply chart reading the same way like a swing trader whose primary timeframe is daily or weekly level. Many beginner day traders make the mistake of analyzing their charts using all kin ...

2 comments




Chart Lessons



Price Pattern Example_20120129_140222
Examples in Reading Charts Using Basic Chart Patterns  premium content

Part of Art of Chart Reading Straight to practical applications of the basic chart patterns. Use Measured Move to Identify Price Targets Measured in 2 different ways back in late 2010 to early 2011 gave you the same price move. Isn't it wise to ...

4 comments


SILVERUSD(1 Day)20130130105320
Chart Lesson: Silver Long Play Jan 29, 2013  premium content

Part of Art of Chart Reading As a routine, I review at least the daily charts on all the markets I trade. It does not matter if I have a position on or not. It is important to have an idea of how the charts look like and how they usually move. In an ...

3 comments


ES May 31 2013_20130531_224641
Chart Lesson: Emini S&P May 31, 2013  premium content

Part of Art of Chart Reading I have marked up this chart with my technical approach in analyzing the Emini S&P intraday chart. You can expand the chart bigger by clicking on it. Sequence of Analysis 1. The previous week rang ...

5 comments


ES Jun 12 2013_20130612_130520
Chart Lesson: Emini S&P Jun 11, 2013 and Jun 12, 2013  premium content

Part of Art of Chart Reading This is a continuation lesson from the previous chart lesson on May 31, 2013. Chart below use a similar mark up scheme like last time. Should make this easier to explain. Sequence of Analysis 1. Pre ...

3 comments


ES NFP Week Jul 5 2013_20130705_102220
Chart Lesson: Emini S&P NFP Week July 5, 2013  premium content

Part of Art of Chart Reading Counter-trend move setup from consolidation week. 1. Previous week range is defined after it ends 2. Previous week was trend week expects more upside so projecting at least touching 25% higher 3. Mo ...

No comment yet


Parabolic Run 4_20130711_183933
Chart Lesson: Emini S&P Week of July 8 to July 12, 2013  premium content

Part of Art of Chart Reading This is a perfect example of parabolic run. I mentioned that back on Monday (July 8, 2013) we have a parabolic run in place in ES and that all other seasonal and cyclical tools point to the same. Take a look at the chart ...

No comment yet




Advanced Chart Lessons



image
Advanced Chart Lesson: Emini S&P Jan 17 to Jan 31, 2014 Waterfall Formation (Part 1)  premium content

Overview Half of the battle in trading successfully is developing good trading habit. What happened to Emini S&P during Jan 17 to Jan 31, 2013 is an excellent case study on what proper chart reading can do for you. Chart readers often find it d ...

5 comments


image
Advanced Chart Lesson: Emini S&P Jan 17 to Jan 31, 2014 Waterfall Formation (Part 2)  premium content

Overview Before we engage the market in real-time, we have to be aware of the various potential scenarios. Daily chart analysis from Part 1 provides us the big picture setups while day-to-day trading do not often trigger these powerful setups. Hence ...

9 comments


image
Advanced Chart Lesson: Emini S&P Jan 17 to Jan 31, 2014 Waterfall Formation (Part 3)  premium content

Overview Actual engagement on Jan 22, 2014 was pretty easy. Execution of the battle plan is just a matter of reacting to the possible outcomes and paying attentions to the development of the price actions. Positive expectancy is built implicitly int ...

11 comments


Section Quick Jump


Introduction

Structure Of Price Movements

Trend And Trend Lines

Basic Patterns

Complex Patterns

Multiple Timeframes Principles

Applying Chart Reading

Chart Lessons

Advanced Chart Lessons



sponsor message (ad free for all members)



Chart Pattern Quick Ref


1-2-3

Bull / Bear Flags

Channel   premium content

Double Top / Bottom

False Breakout   premium content

Head and Shoulder   premium content

Measured Move

Parabolic Run   premium content

Pockets   premium content

Spike and Ledge   premium content

Three Pushes

Wedges   premium content

Wyckoff Spring / Up Thrust   premium content





Share



Captcha Code

Your information will not be shared with anyone.

By signing up you agree to our Terms of Use & Privacy Policy 

Brokerage Deals for Premium Membership

apex-logo-180x32

Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors.
Please read full disclaimer here.

Connect

DaytradingBias on Facebook
DaytradingBias on Pinterest
DaytradingBias on Google+
Follow DaytradingBias on Twitter
Subscribe DaytradingBias News Feed
We accept Bitcoin here

As Featured In


© 2015 Lawrence Chan / DaytradingBias.com. All Rights Reserved.