Here is the simplest checklist I use for checking the technical setup for my trades.
- Zoom out: Start with a chart with as long a time frame as possible – 5 years or so. Helps setup the overall trends. What phase are we in?
E.g. Tesla – what phase is it in?
2. Volume – Check if volume is high (confirmation that trend will continue) or low (not enough volume)
3. Moving Averages (5, 9, 20, 50, 200) – Check if the stock is trading above the long term moving averages (MA – 50, 200) for investing plays, and is trading above short term MA – 9, 20 for swing trades
4. Trend Lines: Connect the highs and the lows. Are you seeing higher highs and higher lows, or lower highs and lower lows?
5. Support and Resistance – What prices do buyers step in to see value (with volume) and where are they willing to sell (confirmed by volume).