The iii (III) chord is a major chord built on the third scale degree of a major key or the minor chord built on the raised third scale degree of a minor key.
Think of the iii (III) chord as the "dreamy" chord in a song. It has a softer and more delicate sound, like floating on clouds or daydreaming.
Mediant: The mediant is another name for the iii (III) chord. It refers to its position as the third scale degree in relation to the tonic.
Parallel Minor/Major: The iii (III) chord shares tonalities with its parallel minor or major key, making it harmonically related to those keys.
Chromaticism: The iii (III) chord can introduce chromaticism into a progression by altering one note from the diatonic scale, adding color and tension.
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