How To Read Stock Charts Without Getting Confused?

have you ever learned of a trading pattern you know the head and shoulders the flag the cup and handle so nice and beautiful on a chart today I wanted to tell you it doesn't work well okay maybe it does if you can see it in a certain way if you have lots of experience but the truth is all chart patterns really do is try to gauge demand and supply and in my opinion you should learn them but please don't use them in this video we're going to talk about what is demand and supply and what's

the psychology behind all this pattern I think you can learn this one thing that we'll discuss today and you don't need to use patterns after that I'll say it again you just learn this one technique we'll talk about today and you can gauge demand and Supply you don't need to learn patterns so let's get to it foreign we're going to start this technique with this chart over here can you tell me what stock this is it doesn't look like a stock which is giving much returns right it looks pretty flat right uh no it's not

adani this is actually onion prices this is the price of onion from 2007 to 2013. now the reason I'm choosing onion prices is telling you that demand and Supply happens in any place where there are buyers and sellers so onion prices are a great way to understand what demand Supply is so very simply put when the price goes below 10 Rupees between 5 rupees so around that 13 rupee mark That's where people say this is so stupid how can onion prices be only 13 rupees and even people like you ask people around you what will

you do you'll buy it right because it's stupid cheap and that's why buyers enter and the price goes up from there and what is this this is just logical and this is is called support on the other hand if prices go to something like 55 or 80 rupees that what do you think sounds very expensive right you won't stock up too much onion prices at say 90 rupees it is stupid expensive and at that point buyers turn to non-buyers which means the buying demand vaporizes and people don't purchase onions as much as they used to

that's all it is and we call this resistance that there is resistance for buyers to actually buy therefore the prices don't continue to move up they just fall so what's interesting about onion price is that demand and Supply exist here as well we have support and we have resistance now the same logic applies on stocks as well applied only to the top 100 stocks with good liquidity you can see whether institutions think a stock is stupid cheap or stupid expensive and based on that you can see the herd deciding whether to buy or sell that's

very important you look at demand and Supply on a high time frame so don't look at this on a minute chart or 15 minutes or even daily look at it at a monthly chart level because that's where you see billions of dollars pouring in deciding whether a stock is too expensive or too cheap before we see a real example type in the comments below price is King and let me see what we have here I have this stock over here let's not name it but I can see that there is a flag there may be

a head and shoulder pattern here there may be a support here so that's the confusion if you try to find and look for a pattern just like looking at the clouds you may imagine something that isn't already there so let's not look at patterns let's understand how to look at demand and Supply so very simply I will teach you something super simple and if you've seen my videos below before I've been teaching this for 10 years now so I will say it again because I really believe in it it's pretty simple and it works on

onion prices or any item where the market is deciding and there is price Discovery so very simply you have to look at price it has to be a higher time frame and for stocks you can only do this on monthly charts for the top 100 or top 50 stocks beyond that it may not work as well so first thing you need to look at let's say prices go up which means there was demand then demand dries up prices go down demand comes back again and prices make a new high now whenever this happens you see

this this is called a swing low now people call this in different names some people call it fractals some people call it pivots but I like calling it swing lows so we'll just stick to that same thing happens again this is also a swing low there's not stop loss it's swing low this is another swing low and in an uptrend you basically want higher swing lows so each swing low is higher than the previous one this generally means that demand is increasing that's it actually so over here you don't need to look at flag patterns

or anything like that they should just be higher swing lows now here's something interesting uh actually no let's do one test I want you to pause the video when I ask you this question I'm going to draw a bunch of swinglers tell me how many you see there you go can you type in the comments below how many swing lows do you see okay so that is the answer is one two three four five so you get a five uh swing lows sorry that's a five five swingers so now that you know what a swing

low is every swing low has to be higher you see this is higher and when it's higher it's called an uptrend and when it's lower that means when this happens uh the now when the Market's going down don't look at swing lows look at the swing highs each lower swing High basically means the downtrend okay so if this was clear let's move on I will drop this Android again for you so this is a swing High so over here higher swing lows so this is an uptrend lower swing highs this is a downtrend okay pretty

simple you can open any chart you'll be able to see this like I said even works in onion prices but this is the basic logic now what's interesting is as soon as you see a swing low is also here this is also a swing low as soon as the swing low breaks you see that the market went below the swing low as soon as that happens we know a possible downtrend has begun now the beauty is if you learn any pattern this is basically what they are trying to do so if you've heard of the

flag pattern this is what it kind of looks like there's an uptrend there's a flag as soon as you break above this swing High we say oh the flag pattern is done now if all you're really looking at is a swing I break then why should you even learn the flag pattern right basically swing High book let's see the opposite there is a bear pattern called the opposite of a flag where the prices go down and there's this inverted flag right basically just like over here as soon as the swing low breaks you see that

downtrend has begun and that's it so let's focus just on an uptrend to keep life easier uh my point is very simple if you learn any pattern they basically do this so we will only look at stocks that are going up because it will keep this video simple and all you have to look is Mark the swing lows as soon as the swing low breaks we say okay the pattern uh has now the the trend is now down okay so we need swings higher swing lows higher swing lows as soon as the swing low breaks

we know that the pattern is complete and the downtrend has begun that's all so let's see some examples so let's look at this stock this is Nifty it so it's the Nifty it Index right it's not one stock it's a group of stocks in the entire ID sector so the first thing we'll do is we'll identify the swing lows I can see a swing low here and here and here and we can see this red bar has broken this swing low as soon as that happened Market went sideways for many months and then collapsed that's

all exactly this Market is going up there was a swing low we broke the swing low there was a little bit of sideways in this case and then the market collapsed I'll show you again here this is the swing low right here this red bar I think it's January where this red bar closed below the swing low Market went sideways even tried to go up and then fell now the pattern guys will say this is a head and shoulders pattern but you don't have to worry you just have to look at a swing low break

because a swing low break means supply has entered and there are no buyers this is very important to think of right all you're really doing for a trend to understand that there should be absence of buyers and there should be a lot of Mo there should be more Sellers as soon as that happens the trend will turn down because for this to happen both need to participate the buyers have to say I'm not buying any more and the sellers have to say I will sell when that happens that becomes a trend and converts the trend

into a down move isn't that interesting that's all it basically is all the other patterns I think will just confuse you so I hope you like the Simplicity of seeing the markets like this now I'm not saying trade based on this but if someone asks how is the market doing you can now look and see higher swing lows no swing low break that means Market is in an uptrend that's it right and another beautiful thing is you're not predicting we're not looking at macroeconomic factors we're not looking at Putin we're not looking at the war

we're just seeing other participants still buying or selling and you're just interpreting that action so I think it's beautiful because you're understanding the current moment and not trying to predict where the market will go because no one can predict and you don't need to let's see one more example this is bandhan Bank and I'm sure you can do a lot of analysis on bandhan bank but at the end of the day you want institutions to be buying the stock for the stock to go up and over here we can see right at the start of

this chart there is a swing low markets went up reversed we broke the swing low the market tried to go up several times uh the swing low broke again and it's a downtrend so now my question to you is what trend is bandhan Bank in right now type it in the comments below is this an uptrend or a downtrend um and I hope you got type bandhan and then give an answer is it uptrend downtrend it's pretty simple I think okay this is a very good example of reliance so now look at this Reliance is

sideways here it breaks the swing High goes up continues up now notice it's looking exactly like this swing low swing low swing okay so higher swing low then in higher swing low then a higher swing low then a higher swing low and then it moves up and you can see right at the start of 2020 it breaks this swing low which means now the trend is down uh but like everything doesn't work perfectly well neither does this immediately later the market reverses and I think the market continued to go up after that but still I

think you were able to capture a good part of the trend um and yeah in this case it didn't work but I have to show you both sides when the pattern works and when demand Supply doesn't work so we can see here demand comes back I guess as soon as the swing High breaks again we know that it's back in an uptrend and I'm sure that's what happened next okay we have Nifty Auto I thought this was very interesting so if you look at Nifty Auto let's look from 2016 onwards okay it will look exactly

like this higher swing lows higher swing lows higher swing lows another high swing low then this big bad Red Bar closes below that swing low and we know that that trend has changed and notice that we've gone from what this 11 000 area all the way to a low of I think that's like five thousand four thousand huge fall right you don't have to predict it you just followed demand and Supply to see what's happening in the market and this is a monthly charge so this happened over what two years so I thought that was

very interesting then again uh swing High brakes and then an uptrend resumes I think that's it so there's no more complication here uh basically in an uptrend if I swing low breaks the trend is gone I hope you find this useful it's one talwar you can use against all the patterns because patterns just gets damn confusing because sometimes uh head and shoulder pattern looks like this sometimes looks like this sometimes like that I think it's very confusing and you don't get perfect pattern so why do it if it gets confusing and if it's discretionary I

think it's a simple way to see whether buying is happening or selling is happening if you thought this was simple wait till you understand all the other nuances of trading which we've actually simplified and you can learn in a cohort with some really smart people and I'm sure you'll enjoy it's a two-day experience the link is in the description I want you to apply but remember Prime is free but not everyone gets in less than 30 people get accepted so apply only if you're serious to understand how trading works if you found this useful don't

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