Visual Library

Some ideas are easier to see than to read. This page gathers the diagrams that explain the core concepts of trading, each with a short explanation and a link to the full lesson. Use it as a quick visual refresher before a session, or as a starting point to explore the school. All diagrams are simplified illustrations rather than real market data.

Candlestick anatomy#

A candle summarises one period of trading. A green or hollow body means price closed above where it opened; red means it closed below. Long wicks show prices that were reached but rejected. See How to Read Candlesticks.

Support and resistance#

Support is a price zone where buying has stopped declines; resistance is where selling has stopped rallies. When a level breaks, it often switches roles. See Support and Resistance and Role Reversal and Retests.

Uptrend structure#

A trend is defined by its swings. An uptrend continues while each pullback stays above the previous low. A break below the last higher low is an early warning of change. See Trend Structure: Higher Highs and Lower Lows and Market Structure Basics.

Option payoffs at expiry#

A long call profits when price rises above the strike plus the premium; a long put profits when price falls below the strike minus the premium. Short positions are the mirror image. See Option Payoff Diagrams and the Option Payoff Calculator.

Drawdown and recovery#

The deeper the drawdown, the larger the gain needed to recover: 50% down needs 100% up. See Maximum Drawdown and the Drawdown Recovery Calculator.

The order book#

The order book shows the liquidity available at each price. Large orders take liquidity from several levels, moving the price. See The Order Book and Market Depth and Market Data Levels: Level 1, 2 and 3.

How to use these diagrams#

Each diagram captures one idea in its simplest form. Real charts are messier: candles overlap levels, trends pause and reverse, and order books change every second. A good habit is to take one diagram at a time, open a live chart and find three real examples that match it and three that do not. Note what happened next in each case. This builds pattern recognition grounded in real outcomes rather than idealised pictures, and it protects you from seeing patterns everywhere. When a concept clicks, follow the link to the full lesson for the details, worked examples and common mistakes. See Trading Journal and How This School Works.

Diagrams elsewhere in the school#

Many lessons include their own diagrams: candlestick patterns such as the Doji and Engulfing Patterns, chart patterns such as Head and Shoulders, bond concepts such as Convexity and Yield Curves, and options strategies such as the Iron Condor. Browse the tracks in the left menu to find them.

Frequently asked questions#

What is the best way to learn chart patterns?#

Study the diagrams, then find real examples on charts and track how they played out, so you see both successes and failures.

Are these diagrams based on real data?#

No. They are simplified illustrations of concepts; the linked lessons include worked examples.

Where can I find formulas for these concepts?#

The Formula Library collects them in one place with links to calculators.

Next, compare the two sides of every trade in Long vs Short.