A signal without a checklist invites improvisation. Improvisation is where discipline goes to die.
This checklist is intentionally simple: support, resistance, volume, and RSI. You do not need twenty indicators to ask whether a stock deserves more research.
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1. Support: Where Did Buyers Previously Show Up?
Support is not a magic floor. It is a region where buyers previously cared enough to stop or slow a decline.
Ask:
- Did price recently bounce from this area?
- Has the stock held this zone more than once?
- Is the signal appearing near support or far above it?
- If support breaks, where is the next obvious area?
For Buy candidates, support can give context. For Sell candidates, broken support can be a warning sign.
2. Resistance: Where Did Sellers Previously Appear?
Resistance is a region where rallies stalled or reversed.
Ask:
- Is price running into a prior ceiling?
- Did the stock reject this area before?
- Is a breakout actually happening, or just being teased?
- Is volume strong enough to make the breakout credible?
A Buy signal just below heavy resistance deserves caution. A Sell signal after repeated rejection may be more interesting.
3. Volume: Was There Participation?
Volume helps you judge whether a move had force behind it.
Look for:
- rising volume on breakouts
- heavy selling on breakdowns
- quiet pullbacks after strong moves
- abnormal event-driven spikes
Volume is not proof. It is a credibility check.
4. RSI: Is Momentum Stretched?
RSI can help spot stretched momentum, but it is not a commandment.
Questions to ask:
- Is RSI extremely high after a fast rally?
- Is RSI extremely low after a sharp selloff?
- Is momentum improving while price stabilizes?
- Is momentum deteriorating while price still looks fine?
Do not use RSI alone. Use it to ask whether the setup is early, mature, or exhausted.
The Four-Part Decision
After the checklist, write one sentence:
The signal is [confirmed/conflicted/inconclusive] because price is [near support/rejecting resistance/breaking out/breaking down/stretched/event-driven].
That sentence is the whole point. It turns chart staring into a decision process.
Checklist workflow: Open a chart, mark support and resistance, check volume, then add RSI only after the structure is clear.
Run the checklist in TradingView
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Keep It Honest
A checklist will not make every signal profitable. It will make your review more honest.
That is already a meaningful upgrade.