Lesson 10 of 10 · 12 min
Course check: test yourself Flashcards for every chart term, and ten mixed questions across candles, trends, levels, patterns and indicators.
By the end you'll be able to
Recall the chart-reading vocabulary from the whole course Answer mixed questions on candles, timeframes, trends, levels, patterns and indicators Decide whether you are ready for Risk & Money Management Free course
Enrol in “Reading Price Charts” to start this lesson Enrolling is free. Your progress, quiz scores and certificate are kept in your account, on every device.
You can now read a chart top-down, mark the swings and levels, name the common shapes and use indicators as a second opinion. Check that it stuck before moving on.
Flashcards
Chart-reading terms
1 / 18
Term Candlestick Tap to reveal Definition A chart element showing the open, high, low and close of one period, with a body between open and close and wicks to the high and low. Term Body (of a candle) Tap to reveal Definition The thick part of a candlestick, drawn between the open and the close. Its length shows how decisively one side won the period. Term Wick (shadow) Tap to reveal Definition The thin line above or below a candle body, reaching to the high or the low of the period. Long wicks show prices that were rejected. Term Timeframe Tap to reveal Definition The length of time each candle represents, such as M15 (15 minutes), H1 (one hour), H4 or D1 (one day). Term Trend Tap to reveal Definition The overall direction of price over a chosen timeframe: up (higher highs and lows), down (lower highs and lows) or sideways. Term Swing high / swing low Tap to reveal Definition A local peak or trough on the chart. A series of higher highs and higher lows defines an uptrend; lower highs and lower lows a downtrend. Term Support Tap to reveal Definition A price area where falling prices have stopped and bounced before. A floor, until it breaks. Term Resistance Tap to reveal Definition A price area where rising prices have stalled and turned lower before. A ceiling, until it breaks. Term Breakout Tap to reveal Definition When price moves through a support or resistance level that had held before, often with a burst of volume and momentum. Term Pullback Tap to reveal Definition A temporary move against the trend before the trend resumes. Many traders wait for a pullback to enter rather than chasing price. Term Range Tap to reveal Definition A period when price moves sideways between a floor (support) and a ceiling (resistance) without a clear trend. Term Chart pattern Tap to reveal Definition A recognisable shape made by price over many periods, such as a double top or a flag, that traders use to anticipate what might come next. Term Neckline Tap to reveal Definition The level joining the dips of a head-and-shoulders or the peak between a double bottom. A break of it confirms the pattern. Term Indicator Tap to reveal Definition A calculation drawn on or under the chart, such as a moving average or RSI, that summarises past prices to help you read them. Term Moving average Tap to reveal Definition The average closing price over the last N periods, redrawn each period. It smooths price so the trend is easier to see. Term RSI Tap to reveal Definition Relative strength index: a 0–100 score of recent gains against recent losses. Above 70 is called overbought, below 30 oversold. Term MACD Tap to reveal Definition Moving average convergence divergence: the gap between a fast and a slow EMA, plotted with its own average (the signal line). Used to read momentum. Term Confluence Tap to reveal Definition When several independent reasons point to the same trade: for example a support level, a trend line and an oversold indicator at the same price.
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Course quiz
Course quiz: 10 questions
Question 1 of 10
A candle opens at 1.0850, trades up to 1.0885, and closes at 1.0852. What is it?
A A strong bullish candle B A shooting star: higher prices were rejected C A hammer
Next question Question 2 of 10
Which is the close of an H4 candle?
A The close of its last M15 candle B The average close of its sixteen M15 candles C The highest close among its M15 candles
Next question Question 3 of 10
Swing highs at 1.2700, 1.2680, 1.2650; swing lows at 1.2640, 1.2615, 1.2590. The trend is:
A Up B Down C Sideways
Next question Question 4 of 10
In an uptrend, the safest place to look for a buy is:
A A pullback to a higher low near support B The moment a new high prints C After the first lower low
Next question Question 5 of 10
Support at 1.0800 has broken. Price rallies back to 1.0800 and stalls. This is called:
A A false break B A support-to-resistance flip C A double bottom
Next question Question 6 of 10
A head-and-shoulders pattern is confirmed when:
A The right shoulder is lower than the head B Price closes below the neckline C RSI drops below 50
Next question Question 7 of 10
Which pattern suggests the current uptrend will continue?
A Double top B Ascending triangle C Head and shoulders
Next question Question 8 of 10
Compared with a 10-period SMA, a 50-period SMA is:
A Faster to react and noisier B Smoother and slower to turn C Identical, just drawn in a different colour
Next question Question 9 of 10
RSI reads 78 during a strong uptrend. The correct reading is:
A Sell immediately B Momentum is strong; not a reason to sell on its own C The trend has ended
Next question Question 10 of 10
In a top-down routine, which timeframe is read first?
A The entry timeframe, to find a trigger B The higher timeframe, for direction and major levels C Whichever shows the clearest pattern
See my score What next
Scored 8 or more: you are ready for Risk & Money Management , which turns these chart reads into properly sized trades.
Scored 5 to 7: revisit the lessons behind the questions you missed, then retake the quiz.
Below 5: go through the course again, slowly, with a demo chart open beside you.
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