Every definition, level and mechanism the video states, chased to a source and cited.
The video makes no claim about what any market did, no win rate, no backtest and no performance figure. Every chart in it is a teaching diagram of a mechanism, and each one says so on screen. What is left to check is the terminology and the mechanics, and that is what this file covers.
An uptrend is a sequence of higher highs and higher lows; a downtrend is a sequence of lower highs and lower lows. Used throughout, and drawn as tagged swing structure in the trend quality chapter.
“An uptrend is made up of ascending peaks and troughs. Higher highs and higher lows.” “A downtrend is made up of descending peaks and troughs. Lower highs and lower lows.”
Source: Fidelity Learning Center, Basic concepts of trend. https://www.fidelity.com/learning-center/trading-investing/technical-analysis/basic-concepts-trend
The framing goes back to Charles Dow’s Wall Street Journal editorials of 1900 to 1902, which is where the higher high and higher low description of an uptrend originates. The editorials themselves are the primary source and are not online in a citable form, so the attribution is carried here rather than stated on screen.
A trend line break is a warning rather than proof. This is the same distinction the video draws between showing that a pullback is ending and proving it, in the confirmation chapter.
“When a trend line is broken, it should serve only as a warning that the trend may be changing.”
Source: Fidelity Learning Center, Basic concepts of trend, as above.
A rising longer term trend produces larger rallies and smaller retracements, and a falling one produces smaller rallies and larger retracements. This is the mechanism behind the depth chapter: retracement depth is a property of the trend it sits inside, not a free number.
“A rising primary/long-term trend causes the secondary/intermediate trend to have larger rallies and smaller retracements.” “A falling primary/long-term trend causes the secondary/intermediate-term trend to have smaller rallies and larger retracements.”
Source: Fidelity Learning Center, Basic concepts of trend, as above.
Support is where demand is strong enough to stop a fall; resistance is where supply is strong enough to stop a rise. Used in the location chapter and drawn as the blocks that either defend a level or fail to.
“Support is the level at which demand is strong enough to stop the stock from falling any further.” “Resistance is the level at which supply is strong enough to stop the stock from moving higher.”
Source: Fidelity Learning Center, What is support and resistance? https://www.fidelity.com/learning-center/trading-investing/technical-analysis/support-and-resistance
Broken resistance can become support, and broken support can become resistance. This is the first item in the list of areas a buyer might expect a pullback to be defended at, and the mechanism behind the failed breakout chapter, where price closes back inside the old range.
“A key concept of technical analysis is that when a resistance or support level is broken, its role is reversed. If the price falls below a support level, that level will become resistance. If the price rises above a resistance level, it will often become support.”
The same page attributes the effect to supply and demand shifting at the breached level, and attributes the levels themselves to the concentration of buyers and sellers at particular prices rather than to anything intrinsic about the number. That is the basis for the video’s point that a level is worth watching because participants are watching it, not because it is magic.
Source: Fidelity Learning Center, What is support and resistance?, as above.
A moving average can act as support while price is above it and as resistance while price is below it. Drawn as the respected moving average in the buy side areas shot and the falling moving average in the sell side one.
“if the price of a stock, index, or other investment is above a moving average, that moving average price can serve as a strong support level … Conversely, if the current price is below a moving average, that moving average price can serve as a strong resistance level.”
Source: Fidelity Viewpoints, Moving averages. https://www.fidelity.com/viewpoints/active-investor/moving-averages
Fibonacci retracement levels. The video names Fibonacci as one of several tools traders use to measure give back, and the grid is drawn on screen with its standard levels.
“0.0%, 23.6%, 38.2%, 50%, 61.8%, and 100%”
The same source describes these as identifying possible support or resistance areas, and notes that counter trend moves tend to fall into these parameters. It does not claim they predict anything, which matches the video’s position that the tool matters less than the question of how much of the prior move has been given back.
Source: Fidelity Learning Center, technical indicator guide, Fibonacci Retracement. https://www.fidelity.com/learning-center/trading-investing/technical-analysis/technical-indicator-guide/fibonacci-retracement
Value area. Named in the list of areas a buyer might expect a pullback to be defended at, and drawn as a shaded band. The value area is the price region containing the bulk of a session’s trade, expanded outward from the point of control until it covers roughly seventy per cent of the time price opportunities. No percentage figure appears on screen, so only the concept is being asserted.
Source: CQG documentation, Market Profile Value Areas. https://help.cqg.com/cqgic/25/Documents/marketprofilevalueareasmpva.htm
Distribution and absorption as names for what a range can be doing when a trend is weakening. Both are named in the shot where one leg is read three ways.
Distribution in the Wyckoff framework is a sideways range following an extended advance, in which stock is passed to buyers who expect the trend to continue. Absorption is the effort versus result reading: heavy volume that produces very little price progress.
“Effort was expended but the result was limited, which signals potential absorption by the opposite side.”
Source: CMC Markets, Wyckoff method explained: accumulation and distribution. https://www.cmcmarkets.com/en-gb/trading-strategy/what-is-wyckoff-method
The framework originates with Richard D. Wyckoff, whose course of instruction was published through the Stock Market Institute in 1931. That original text is sold rather than published openly, so the definitions above are cited to a public secondary source and the attribution to Wyckoff is carried here.
A stop order is a trigger, not a guaranteed price. This is what stands behind the invalidation chapter’s point that a random tight stop is not an answer to an invalidation that sits too far away, and that reducing size, waiting for a better entry or skipping the trade are.
“When the stop price is reached, a stop order becomes a market order.” “The stop price is not the guaranteed execution price for a stop order. The stop price is a trigger that causes the stop order to become a market order.” “A stop order may be triggered by a short-term, intraday price move that results in an execution price for the stop order that is substantially worse than the stock’s closing price for the day.”
Source: U.S. Securities and Exchange Commission, Office of Investor Education and Advocacy, Investor Bulletin: Stop, Stop-Limit, and Trailing Stop Orders. https://www.investor.gov/introduction-investing/general-resources/news-alerts/alerts-bulletins/investor-bulletins-15