A stock chart tells a story. Learning to read it helps you understand a stock’s journey and the market’s mood. This isn’t about predicting the future; it’s about understanding the present.

Beyond Price – Adding Context:

• Price & Volume: Look at the price change and the trading volume (how many shares were traded). A 5% price jump on very high volume is more significant than the same jump on low volume, as it shows strong conviction from many investors.
• Moving Averages (The Underlying Trend): A moving average smooths out the daily price jumps to show you the underlying trend. For long-term investors, the 50-day and 200-day moving averages are useful. If the price is consistently above them, the stock is in a healthy uptrend.
• Support & Resistance (The Market’s Memory): You’ll often see prices bounce off a certain level (support) or struggle to break through another (resistance). These are psychological areas where buyers or sellers tend to show up. Understanding these levels gives you context for where the stock has been and where it might struggle.

Mini-Exercise:

Go on Trading View an take a look at the chart for MTNNCan you see a general trend over the last year? Can you spot a price level where the stock repeatedly bounced upwards from? This is observing the market in action.