Your 13 Setups, All In One Place

A parabolic move runs on buyers who refuse to wait for a pullback, and that kind of chasing burns out fast once the last of them is in. The first red candle after a straight-up spike matters because it's the first evidence any seller showed up at all, and if that candle's volume beats the green candles before it, genuine supply entered a stock that had none.

• EntryShort the first red 1-minute candle after a vertical, multi-candle spike with no pullback.
• ConfirmThe red candle's volume exceeds the average of the preceding green candles.
• InvalidatePrice makes a new high before printing that first meaningful red candle.

Practice It · Buy / Sell / Flat

A short squeeze feeds on forced buying, shorts covering into a move that keeps going, and that fuel supply is finite. The lower high on declining volume is the read that the forced buyers are mostly gone, since a fresh high with heavier volume would mean new shorts are still getting trapped and the squeeze still has ammunition left.

• EntryShort once a squeeze-driven spike stalls and prints a lower high on declining volume.
• ConfirmThe lower high forms with volume noticeably below the spike's peak volume.
• InvalidatePrice takes out the spike high, extending the squeeze.

Practice It · Buy / Sell / Flat

VWAP is where the day's actual average trader sits, and the further price stretches from it, the more that gap represents unrealized profit for whoever got in early, profit that eventually gets taken. The reversal candle at the extension point confirms someone is starting to take it, not that the move looks stretched to your eye.

• EntryFade back toward VWAP when price has extended an unusual distance above or below it.
• ConfirmPrice stalls and prints a reversal candle at the extension high or low.
• InvalidatePrice continues extending away from VWAP without a reversal candle.

Practice It · Buy / Sell / Flat

A sharp decline into well-tested support is a collision between two forces, sellers pushing hard and a level that's already proven buyers show up there. The long lower wick on the bounce candle is the visible record of that fight, price pushed below the level and pulled back above it in the same candle.

• EntryBuy a bounce at a well-tested prior support level after a sharp decline.
• ConfirmThe bounce candle closes above the support level with a long lower wick.
• InvalidatePrice closes below the support level, negating the bounce.

Practice It · Buy / Sell / Flat

Two roughly equal peaks with a valley between them tell a specific story: buyers tried the same level twice and failed twice. The lower volume on the second peak separates a genuine double top from two random highs that happen to line up, since it shows fewer buyers were willing to chase the level a second time.

• EntryShort the break of the neckline, the valley low, between two roughly equal peaks.
• ConfirmThe second peak forms on lower volume than the first.
• InvalidatePrice breaks above the second peak before the neckline gives way.

Practice It · Buy / Sell / Flat

The double bottom is the double top's mirror. Two roughly equal lows with a peak between them, and lower volume on the second trough showing sellers had less left to give the second time. The neckline break confirms buyers reclaimed the ground between the two lows instead of the pattern sitting there unresolved.

• EntryBuy the break of the neckline, the peak high, between two roughly equal troughs.
• ConfirmThe second trough forms on lower volume than the first.
• InvalidatePrice breaks below the second trough before the neckline gives way.

Practice It · Buy / Sell / Flat

An exhaustion gap shows up at the end of a run, not the start of one, and the tell is context. A stock that's already extended for several days gapping up again is often the last wave of buyers arriving at the party, not the first. Watching whether price can hold that gap's opening print for the first 15 to 30 minutes is how you separate exhaustion from genuine continuation.

• EntryFade a gap that occurs after an already-extended multi-day run, once the gap fails to hold its opening print.
• ConfirmPrice trades back below the opening print within the first 15-30 minutes.
• InvalidatePrice holds the opening print and grinds to new highs instead.

Practice It · Buy / Sell / Flat

Divergence is a momentum read, not a price read. Price making a new high while RSI fails to make a new high alongside it means the move is happening on less underlying force than the last one, even though the chart itself looks stronger. Two clear swing points are the minimum needed to call it genuine divergence instead of RSI bouncing around inside its normal range.

• EntryFade a new price high, or low, that isn't confirmed by a new high, or low, on RSI.
• ConfirmThe divergence spans at least two clear swing points, not noise alone.
• InvalidatePrice and RSI both make a fresh extreme together, negating the divergence.

Practice It · Buy / Sell / Flat

A climax candle is capitulation made visible, one bar where volume spikes to several multiples of the session average and the range blows out wider than anything before it, usually meaning the last panicked sellers finished selling all at once. The first higher low after that candle reads as supply actually drying up, not pausing.

• EntryBuy the first higher low after a single candle prints volume several multiples above the session average on a sharp drop.
• ConfirmThe climax candle's range is unusually wide compared to the preceding candles.
• InvalidatePrice makes a new low on comparable or higher volume than the climax candle.

Practice It · Buy / Sell / Flat

A trendline that's held for multiple touches has genuine trading decisions behind it, not a line drawn after the fact, and a decisive close through it is different from the wicks that have probably poked through it a few times already without meaning anything. The close is what separates noise from an actual structural break.

• EntryShort, or buy, once price closes decisively through a well-respected trendline that has held for multiple touches.
• ConfirmThe break candle closes beyond the trendline; a wick through it does not count.
• InvalidatePrice closes back on the trendline's original side within 1-2 candles.

Practice It · Buy / Sell / Flat

Moving averages act like a rubber band for price, and the further price stretches from one measured in ATRs, the more tension builds up for a snapback. The small-bodied candle or doji at the extension point is the visible sign that tension is finally releasing, buyers and sellers reaching a rough draw after one side had been in complete control.

• EntryBuy, or short, when price trades an unusual number of ATRs away from a key moving average, on the first sign of stalling.
• ConfirmA doji or small-bodied candle prints at the extension point.
• InvalidatePrice extends further from the moving average without stalling.

Practice It · Buy / Sell / Flat

The first move on a headline is often reflexive, algorithms and fast fingers reacting to a few keywords before anyone has processed what the news means. When that reflexive spike stalls right at a level that already mattered before the headline, an old high or a round number, that's a genuine reason for the stall, not a coincidence.

• EntryFade an initial knee-jerk spike on a headline once the spike stalls and the first red candle prints.
• ConfirmThe stall happens at or near a prior technical level, an old high or a round number.
• InvalidatePrice breaks through that technical level instead of stalling there.

Practice It · Buy / Sell / Flat

An obvious swing high or low is exactly where a lot of stop orders sit, and a brief spike through that level followed by an immediate reclaim looks like those stops got run before the genuine move happened in the other direction. The speed of the reclaim, one or two candles, not ten, separates a genuine liquidity grab from a breakout that pulled back.

• EntryBuy, or short, the sharp reversal that follows a brief liquidity sweep through an obvious swing high or low that quickly reclaims the level.
• ConfirmPrice reclaims the swing level within 1-2 candles of breaking it.
• InvalidatePrice holds beyond the swing level instead of reclaiming it.

Practice It · Buy / Sell / Flat