Opening your first graph can feel like entering a high-tech laboratory: colored candles, lines everywhere, and a lot of acronyms. Before you jump into looking for "magic signals" or feeling overwhelmed, let's land the most essential concepts that every novice trader needs to master. With them, any strategy—from PO3 to Smart Money—will be much easier to understand and apply.

1. Trend: The Current You Must Surf 🌊

In simple words, a trend is the prevailing direction of the price:

  • Bullish (uptrend): higher and higher highs and lows.

  • Bearish (downtrend): lower and lower highs and lows.

  • Sideways (sideways): the price oscillates between two limits with no clear direction.

Why does it matter? Because trading in favor of the trend is like rowing with the current, not against it. Trying to "fish" for big opposing turns without clear confirmation is playing at a disadvantage.

linear example of Uptrend, downtrend and sideways (the most dangerous of them)

2. Japanese Candles: The Language of Price Action 🕯️

Each candle is a small story of what happened in a time interval (1 min, 15 min, 1 h... up to daily). Its parts are:

  • Open

  • High

  • Low

  • Close

    Structure of Japanese candles.


    Some basic patterns:

  • Hammer: long wick down, small body up. Indicates rejection of low prices.

  • Doji: open and close almost the same. Sign of indecision.

  • Engulfing: a candle completely "embraces" the previous one. Changes the narration.

Learning to read candles allows you to see the collective psychology: who won the "fight" between buyers and sellers.

Other types of candles and their probable interpretations, but remember, they are not confirmations (least in low time frames like minutes), but extra arguments to your analysis.

3. Support and Resistance: Your Reference Points 🛑🟢

  • Support: level where demand usually stops falls and pushes the price up.

  • Resistance: level where the offer stops rises and can reverse the direction.

Draw them connecting the most relevant lows (supports) and highs (resistances). You will see how the price "respects" those zones, bouncing or, when it breaks them, accelerating with a BOS (Break of Structure).

Supports (blue), and resistances (red).

4. Volume: The Fuel of Movement ⛽

A price that goes up without volume is a candle without air: it has no force.

  • High volume + strong movement = confirmation.

  • Low volume + strong movement = suspicion of manipulation (liquidity sweep).

Examples of how volume evidences the trades of large institutions.

Look for divergences: if the price makes a new high but the volume goes down, be careful: it may be a sign of a possible pullback.

5. Time Frame: Zoom In and Zoom Out ⏰

Each temporality tells a different part of the movie:

  • LTF (Low Time Frame) like M5 or M15 gives you precise entry points.

  • HTF (High Time Frame) like H4 or D1 shows you the major trend.

Aligning your trade idea in at least two frames helps you filter "noise" and trade with more confidence.

Candle corresponding to a larger time frame and how it was formed by movements in smaller time frames, all from the point of view of the Power of Three (PO3) strategy.

Your Next Step

Now that you know these pillars, your next mission is to practice: open a chart (larger time frames like hours or days are stronger and more relevant), identify a trend, draw supports and resistances, observe candle patterns and check the volume. Do it calmly and keep a small trading diary: write down what you saw and why, even if it's only in demo.

All concepts in a single image and a little more.

In the next publication we will combine these fundamentals to build your first simple strategy, step by step. In the meantime, celebrate this achievement! You have taken the first step to becoming a trader with vision, not luck. 🚀

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See you soon.