Learning to read charts and interpret basic technical indicators is essential for anyone wanting to trade or invest in the financial market. Below, I explain the main concepts and indicators:

1. Types of Charts

Line Chart: Shows only the closing price over time. It is simple, but limited.

Bar Chart: Shows open, high, low, and close (OHLC).

Candlestick Chart: More commonly used by traders, also shows OHLC, but with a more intuitive visual.

2. Main Technical Indicators

RSI (Relative Strength Index)

Measures the strength of price movement.

Scale of 0 to 100.

Above 70: overbought asset (may drop).

Below 30: oversold asset (may rise).

Useful for identifying reversals.

MACD (Moving Average Convergence Divergence)

Shows the relationship between two moving averages (usually 12 and 26 periods).

Composed of:

MACD Line.

Signal Line (usually 9 periods).

Histogram (difference between MACD and signal line).

Common signals:

MACD line crossing above the signal line = buy.

Crossing below = sell.

Moving Averages

Smooth prices to identify trends.

Simple Moving Average (SMA): arithmetic average of prices.

Exponential Moving Average (EMA): gives more weight to recent prices.

Signals:

Price above the average: uptrend.

Short-term crossing above the long-term average (e.g., EMA 9 crossing above EMA 21) = buy signal.

3. How to start practicing

Use platforms like TradingView to study charts for free.

Start by analyzing assets you know (stocks, cryptos, etc.).

Practice identifying:

Trends (up, down, sideways).

Supports and resistances.

Entry and exit points based on the indicators.