Observing Price Action to Support Decision Making Using SPXS&P 500SP:SPXemanuelaeliasHere I walk through a little bit of price action using the S&P, but this applies to any stock you trade. There are two elements to chart reading that you have to reconcile: context charts price action (zoomed out view), trade chart price action (zoomed in view). Right now, the S&P has been trading in a defined range (zoomed out part of chart reading) roughly 6,800 up to 7,000. We’ve been rotating inside that box for a while. Last week we saw a gap down reversal, pushed halfway back up, then pulled back again. Friday we closed up, there were wicks on the hourly time frame, near 6,900. Price pushed up there and couldn’t stay there, it kept getting sold back down. That’s just information I want for the next trading day so I'll note something like, pushing up from bottom of weekly level but sellers present at 6,900. I often include a screenshot as well. The goal isn’t prediction. It’s reaction with preparation. If we push into a level and fail to hold it, that’s information. Right now, we are in the middle of a range, and it can feel unclear. And that's okay too and you can literally write down, "direction unclear", still mark levels, but wait it out. When I review SPX or a stock on my shortlist, I want to note: Where did we reject? Where did we hold? Where did we see repeat selling? Where did buyers defend? For instance, we saw rejection up top earlier in the week, and then consistent trouble holding certain intraday levels. When that same type of roll-over behavior shows up again, that’s recurring price action.