In trading, "reading charts" is not about looking at lines, but about analyzing structure, strength, and capital attitude. The core is three things: direction, position, and signals.

1. First, look at the big picture: don't look for buying points during a decline.
Only consider three levels:
Major cycle (daily / 4-hour)
Moving averages in a bullish arrangement (short-term above, long-term below) = uptrend
Moving averages in a bearish arrangement = downtrend
Moving averages intertwined = consolidation
High and low points
Higher highs and higher lows → Bullish
Lower highs and lower lows → Bearish
Key conclusion
In an uptrend, only buy on pullbacks
In a downtrend, only sell on rebounds
In consolidation, buy low and sell high, don’t chase
2. Next, look at position: don’t chase at the top, don’t buy at the halfway point.
Focus on three key positions:
Previous high and previous low
Breakthrough previous high and retest without breaking → Strong
Break below previous low and rebound without breaking → Weak
Support and resistance
Levels touched multiple times → Strong support / resistance
Trend lines, channel lines
Position judgment tips
High volume at high levels without rising → Be cautious of a top
Volume drying up at low levels with no decline → Possible stabilization
In the middle range, observe more and act less
3. Finally, look at signals: only act on high-confidence signals.
No need to memorize too many, remember these most reliable:
Candlestick signals
Large bullish candle + high volume = Strong
Large bearish candle + high volume = Weak
Long upper shadow at high levels → Heavy selling pressure
Long lower shadow at low levels → Support present
Volume-price relationship (most core)
Rising volume with price increase, decreasing volume with price decrease → Healthy upward movement
Rising volume with price decrease, decreasing volume with price increase → Fake rally
High volume at high levels with stagnation → Reversal possible at any time
Patterns
Breakouts: box breakout, triangle breakout, head and shoulders bottom/top
Only trade breakouts confirmed on retest, don’t chase straight-line surges
4. A complete chart reading process (follow directly)
Open the daily chart: judge trend direction
Look at 1-hour / 15-minute charts: find structure highs and lows
Identify support and resistance levels
Wait for candlestick + volume confirmation signals
Only place orders in the direction of the main trend
If signals are conflicting, exit immediately, don’t hold stubbornly
5. Common mistakes beginners make when reading charts
Only look at small timeframes, ignore the big picture → get swept frequently
Only look at candlesticks, ignore volume → easy to be deceived by lines
Chasing after rises, selling on dips → chasing highs and panicking on lows
Full of ideas about buying points, ignoring selling points → small gains turn into big losses