Dow Jones
$524.32
+0.54%
DIA · day range 519.25–525.61
Hustlin' / Markets / Technical Analysis
A chart is the complete history of every price two people have ever agreed on for a thing. That is genuinely useful information and it is not a forecast, and most of what goes wrong in technical analysis comes from confusing the two. This page covers what price and volume can actually tell you, what the evidence supports, and where the whole discipline is at its weakest — including the parts usually left out of the pitch.
Free, no account, no email. Nothing on this page is investment advice.
Today's focus
A chart is a record, not a forecast.
It tells you exactly what has already been agreed on, and nothing at all about what will be. Every mistake in this discipline starts by blurring that line.
Where it closed
The most basic technical read there is: where did price finish relative to where it traded all day? A close at the top of the range means buyers had the last word. A close at the bottom means sellers did. It is a small piece of information, and it is real.
$524.32
+0.54%
DIA · day range 519.25–525.61
$82.25
-0.66%
TLT · day range 81.89–82.45
The method
Almost everyone learns this backwards — they start with indicators, because indicators look like answers. Indicators are the fourth layer, and they are derived from the first two. Learning them first is how people end up with a screen full of coloured lines and no idea what any of it means.
Why this order Those five layers are the five stages of Technical Analysis — Chart Basics, Trend & Volume, Chart Patterns, Indicators & Signals, then Advanced Methods. Everything on this page is free and always will be.
Layer 1 — Chart basics
Any symbol, any timeframe, with drawing tools and indicators. Everything discussed further down this page can be added to this chart directly, which is the point of putting it first.
Each candle shows four numbers for its period: where price opened, where it closed, and the highest and lowest it reached in between. The body is the distance between open and close; the thin lines are the extremes. That is the entire vocabulary. Everything else on this page is arithmetic performed on those four numbers.
Which matters because it sets a hard ceiling on what technical analysis can possibly know. A chart contains no information about what a company earns, what it owes, whether its biggest customer just left, or what the Federal Reserve will do next month. It contains prices. Anyone claiming a chart told them something that is not in those four numbers is telling you about themselves, not the market.
Before you go further
Technical analysis is not one thing. It is a bundle of quite different claims with very different amounts of evidence behind them, and lumping them together is how the whole field ends up either oversold or dismissed. Here is the honest split.
Well supported
The tendency for what has been rising over months to keep rising a while longer is one of the most replicated findings in finance, across countries, decades and asset classes.
It still fails badly at turning points, and the reversals are sharp. Persistent is not the same as reliable.
Well supported
Sizing a position against a predefined exit is not a prediction method at all. It is arithmetic that caps how wrong any single decision can make you.
Arguably the most valuable thing in the discipline, and the part people skip because it is not exciting.
Mixed
Long-average trend filters have some support as regime indicators — reducing exposure below a long average has historically cut drawdowns.
It also cuts returns, and whipsaws in sideways markets. Useful as context, poor as a trigger.
Mixed
Genuinely surfaces information an index level hides. Narrowing participation has often preceded weakness.
"Often preceded" is doing heavy lifting. Breadth can narrow for a long time while price keeps rising.
Weak
Head and shoulders, flags, wedges. Enormously popular and they perform poorly under systematic testing.
They are identified after the fact, and humans see shapes in noise reliably. The pattern is usually in the observer.
Weak
Fibonacci extensions, measured moves, wave counts. Anything producing an exact future price from past prices alone.
The precision is the tell. A method that gives a number to two decimal places is describing confidence, not evidence.
Why publish this Because a course that only tells you what works is selling, not teaching — and because knowing which layer you are standing on is what stops you betting the same size on a trend filter and a wedge pattern. Technical Analysis covers all five layers, including the weak ones, with the same caveats attached.
Layer 5 — Market internals
The S&P 500 is weighted by market value, so the largest companies move it far more than the rest. A handful of enormous stocks can carry the index to a new high while most of its members are falling. The index level cannot show you that. Breadth can.
Each chart below tracks the percentage of S&P 500 companies trading above a given moving average. High readings mean broad participation. Falling readings while the index rises mean the rally is being carried by fewer and fewer names — which is worth knowing, and is not a sell signal.
Each chart on its own is close to useless. The information is in how they line up, because the three lookbacks are effectively three different time horizons of the same question and disagreement between them is the signal. Five configurations cover almost everything you will see.
Healthy
Broad participation across every horizon. Most companies are above most of their averages and the index reflects that honestly.
Tells you the current move is real. Tells you nothing about tomorrow — this configuration has persisted for years and has also ended abruptly.
Narrowing
The classic divergence. The index is being carried by fewer and fewer names while the average company is already rolling over.
Has often preceded weakness. Has also run for over a year without any — which is why acting on it alone has cost people enormous upside.
Churn
Short-term breadth swinging between extremes while the long-term read barely moves. A range, not a trend.
The environment where trend-following performs worst and generates the most false signals. Worth recognising precisely so you expect less from your indicators.
Thrust
A rapid move from almost nothing participating to almost everything, usually over days rather than weeks, off a low.
Among the better-documented breadth configurations. It is rare, and rarity is exactly why you should not wait for one.
Washout
Almost every company below its short-term average at once. This happens near panic lows and it does not happen often.
The least unreliable configuration on this list, and "least unreliable" is genuinely the strongest claim available here.
Deterioration
Short, medium and long-term participation all declining. No disagreement between horizons — everything is getting worse in step.
Unambiguous about the present and silent about the future. Most declines look like this, and so do most pullbacks that recover in a fortnight.
Say the S&P 500 sets a record high, and the percentage of its members above their 200-day average has fallen from 70% to 45% over the same three months. Those two facts are not in conflict — they are describing different things. The index is capitalisation weighted, so a handful of the largest companies rising can outweigh several hundred smaller ones falling. Breadth counts companies; the index counts dollars.
What you have learned is concrete: the move is narrow. What you have not learned is what happens next, and this is where almost everyone overreaches. Narrow markets have broadened out and kept rising. They have also rolled over. The useful response is not to sell — it is to notice that an index fund now has more of its outcome tied to fewer companies than it did three months ago, and to decide whether you are comfortable with that concentration. That is a portfolio question, not a timing one.
Where breadth actually earns its keep Not as a signal. As a check on the story you are being told. When a headline says "markets hit record high", breadth tells you whether that describes the market or five companies in it — and that is a factual question with a factual answer, unlike almost everything else on this page.
Layer 5 — Global context
Breadth asks what the S&P 500 is hiding inside itself. This asks the same question a level up. When US indexes fall, the first useful check is whether Europe and Asia fell too. If they did, it is a global repricing — rates, the dollar, oil, risk appetite. If they did not, it is something about the US specifically, and that is a different problem with different consequences for what you own.
Pick an index. The left chart is one year of daily bars — the move you are actually living through. The right is five years of weekly bars, which is the one people skip and the one that supplies the scale: a drop that dominates the daily chart often turns out to be an ordinary wobble on the weekly, and occasionally it turns out not to be.
S&P 500 — 1 year, daily
Every trading day for the last twelve months. Close enough to see individual sessions.
S&P 500 — 5 years, weekly
One bar per week for five years. Same index, enough distance to judge whether a move is big.
Direction agreement is the whole exercise. If the Nikkei, the DAX and the S&P are all turning at the same time, whatever is happening is bigger than any one economy and the cause is usually macro — rates, the dollar, energy. When one market diverges and keeps diverging, that is domestic: policy, currency, or a sector that dominates that index. The Nikkei and the Hang Seng have both spent long stretches disconnected from the US, and Hong Kong in particular trades on mainland China policy far more than on anything happening in New York.
The honest limit, same as everywhere else on this page: agreement across markets tells you the move is broad, not that it will continue. Every global sell-off in history looked exactly like this on the way down, including the ones that recovered within weeks.
Layer 5 — Intermarket
The oldest surviving idea in technical analysis, and the one with actual economic reasoning underneath it rather than pattern-matching. If factories are genuinely producing more, somebody has to move the goods — so industrial strength ought to show up in transport companies too.
When both averages make new highs together, Dow Theory calls it confirmation: the price move is consistent with real economic activity underneath it. When the industrials push to a new high and the transports fail to follow, that is a non-confirmation — a hint that goods may not actually be moving at the rate the industrial average implies.
The honest assessment is that this is a slow, coarse signal with a long history of being both right and wrong, and its record has weakened as the economy shifted away from physical goods. An economy where a large share of value is software and services is one where transport stocks tell you less than they did in 1900. It is worth watching as one input among several; it is not worth trading on its own.
Where this connects Transports are also a real economic indicator, not just a chart — freight volumes respond to the same forces as industrial production and retail sales, which are on the free Economic Analysis page. A divergence there and a divergence here are the same story told twice.
Participation
The same question breadth answers, asked of all eleven sectors at once. A single day tells you almost nothing — sector moves are close to noise over one session. Persistence is the whole point, so this reads across six timeframes plus where each sector sits inside its own 52-week range.
| Sector | ETF | Today | 1W | 3M | 6M | YTD | 1Y | 52w range | Off high |
|---|---|---|---|---|---|---|---|---|---|
| Healthcare | XLV | -0.6% | -0.5% | +13.8% | +2.8% | +5.0% | +24.6% | 85 | -3.5% |
| Technology | XLK | -0.2% | +0.6% | +10.2% | +20.0% | +21.8% | +33.5% | 68 | -11.8% |
| Financials | XLF | -0.1% | +0.1% | +9.7% | +6.6% | +4.0% | +8.7% | 93 | -1.1% |
| Industrials | XLI | +0.8% | -1.8% | +5.8% | +9.4% | +15.9% | +18.3% | 83 | -3.5% |
| Real Estate | XLRE | -0.5% | -1.5% | +3.3% | +9.3% | +11.7% | +8.8% | 79 | -3.0% |
| Consumer Staples | XLP | -0.5% | -0.4% | +2.6% | +2.7% | +9.5% | +6.6% | 66 | -5.7% |
| Energy | XLE | +1.0% | +2.0% | +0.9% | +21.0% | +33.2% | +36.6% | 82 | -6.2% |
| Consumer Discretionary | XLY | +3.3% | +4.7% | -0.6% | -5.1% | -2.8% | +4.9% | 55 | -7.1% |
| Materials | XLB | -2.3% | -1.9% | -1.0% | +0.8% | +11.2% | +15.0% | 69 | -6.8% |
| Utilities | XLU | -0.7% | -2.9% | -2.9% | +3.5% | +3.9% | +3.5% | 48 | -7.2% |
| Communication Services | XLC | +1.6% | +0.5% | -6.1% | -8.1% | -8.1% | +0.8% | 21 | -10.1% |
Three patterns are worth naming. Consistent leadership — green across 3M, 6M and 1Y with the range column high — is a sector genuinely being accumulated, and it is the only pattern here with any staying power. Fresh reversal — red on the year but green on the week and three months, range still low — is either a bottom or a bounce, and the table cannot tell you which. Fading leadership — strong on the year, weak on the week and month, well off the high — is money leaving something that used to work, and it is usually visible here before it is visible in commentary.
The range column is the breadth part, and it is the one most people skip. A sector can be up 2% today and still sit 25% below its 52-week high. Those two facts together describe something a daily change completely hides: participation. A row that is green today with a range reading of 15 is a bounce inside a downtrend, not leadership.
What none of this does is tell you what happens next. Rotation is a real long-run pattern and a hopeless schedule — sectors lead out of turn constantly, and the phase of a cycle is only identifiable afterwards. Use the table to describe the present accurately, which is genuinely hard and genuinely useful, and stop there.
The table treats every sector equally. The heatmap does not — it sizes each company by market value, so it shows where the weight actually sits. If a handful of blocks dominate the screen, that is concentration risk rendered visually, and it is the same story the breadth charts tell in numbers.
For the same information at company level, the heatmap shows every S&P 500 member sized by market value and coloured by today's move — which makes concentration obvious at a glance in a way a table cannot.
Learn the reasoning
Charts, breadth and heatmaps are all here for nothing. What a course adds is the structure — which layer a given signal belongs to, how much weight it has earned, and how to build a process that survives being wrong, because you will be wrong regularly.
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One-time. Lifetime access. Price includes tax — nothing is added at checkout.
$127.95
All four paid courses. One-time, lifetime access, tax included.
Not investing yet? Do not buy any of these. The free Financial Literacy course covers banking, debt and an emergency fund first, and none of the above matters until those are handled.
Common questions
The honest answer is that it depends heavily on which part you mean. Momentum and trend-following have decades of academic support across many markets and asset classes — the tendency for what has been rising to keep rising over intermediate horizons is one of the most replicated findings in finance. Specific chart patterns fare far worse under testing, largely because they are identified after the fact and human beings are extremely good at seeing shapes in noise. Risk management built on price levels, such as position sizing against a stop, is not a prediction method at all but is arguably the most valuable thing in the whole discipline.
Breadth measures how many individual stocks are participating in a move, rather than what the index level is doing. Because major indices are weighted by market value, a handful of very large companies can carry the index higher while most of its members fall. Breadth exposes that. When an index makes a new high while the percentage of its stocks above their 200-day average is falling, the rally is narrowing — which historically has often preceded weakness, though it has also persisted for a long time without one.
Formulated from Charles Dow's editorials around 1900, its best-known principle is that the industrial average and the transport average should confirm each other. The reasoning is economic rather than mystical: if factories are producing more, someone has to ship it, so transport stocks should be strong too. When the industrials make a new high and the transports do not, that divergence is a warning the underlying activity may not support the price move. It is a slow, coarse signal with a long history of both correct and incorrect calls.
Both average the closing price over a set number of trading days, so a 50-day average reflects roughly the last two and a half months and a 200-day roughly the last ten. The shorter one reacts faster and gives more signals, most of which are noise; the longer one reacts slowly and is generally used to define the prevailing trend. Neither predicts anything — they are summaries of what already happened, which is precisely why they lag.
No, and treating it as one is among the most expensive beginner mistakes. RSI measures the speed of recent price change on a 0 to 100 scale, and readings above 70 are conventionally called overbought. But in a strong uptrend RSI can stay above 70 for weeks while price continues rising — selling on that reading alone means exiting exactly the moves that would have paid the most. It is better read as a description of momentum than as a trigger.
Sources and method. Charts, breadth indices and the heatmap are supplied by TradingView and may be delayed. Index quotes and sector performance come from Finnhub and are written into this page when the site is rebuilt. Breadth uses the published 20, 50 and 200-day S&P 500 participation indices (S5TW, S5FI, S5TH), which have long histories and can be embedded; arbitrary lookback periods cannot be embedded and would need recreating inside a charting account.
This is not investment advice. Hustlin' is educational and entertainment content. No signal described here predicts the future, the limits of each are stated alongside it, and past performance does not guarantee future results. See our editorial standards for how claims are sourced.