Charts

For traders’ usability we can watch price movements of different currencies and assets(such as stocks, futures etc.) on different types of charts. Different currencies’ and assets’ quotes data is being fed to Your special trading terminal (which You download prior commencement of Your trading, download links can be found on brokers’ websites), and the trading terminal in its term is formulating a chart from these quotes. There are 4 main types of charts in most of trading terminals You may come across: Tick Chart, Candle Chart, Bar Cart and Line Chart. 

1. Tick Chart and timeframes 

You can view the most detailed information about price’s movement on a tick chart. Tick chart is some kind of a microscope under which You can see price movement in the closest proximity. But this chart is not always useful in trading. They would have to analyze a huge amount of data which will make the possibility of making an error greater, making technical market analysis more complicated. That is why trading platform providers have developed a technology where tick meanings are summed up and divided into equal periods, which are called timeframes. On such timeframes – periods of time can be reflected (by trader’s choice) in Japanese candles or in bars or in line chart which is very similar to a tick chart. 

Here are the main timeframes: M1 (1 minute), M5 (5 minutes), M15 (15 minutes), M30 (30 minutes), H1 (one hour), H4 (four hours), D1 (one day), W1 (one week), MN (one month). If we look at the most common example charts used by traders, Japanese candlesticks, then every candle of this chart will correspond to the time interval You chose. If it is M1 chart then one candle=one minute, if it is H1 chart then one candle corresponds to one hour. 

2. Candle Chart 

Candle chart is the most popular among traders. That said, click on JAPANESE CANDELSTICKS to read a full article on them or carry on reading for a brief explanation.  Candlestick analysis came to the modern world of Forex from medieval Japan which is why they are sometimes called Japanese candlesticks. Such type of quotes reflection is convenient as there is a visual representation of 4 important features of the timeframe You chose: 

Candle open price (open) – price which was at the beginning of the time interval  

Candle close price (close) – price which was at the ending of the time interval  

High price (high) is the highest price which the candle has reached on the chosen timeframe. 

Low price (low) is the lowest price which the candle has reached on the chosen timeframe. 

The very Japanese candle consists of the Candle’s Body and Candle’s Shadow. 

Candle’s body is a rectangle which connects the candle’s price of open and close. 

Candle’s shadows are lines which are situated above and below the candle body. These lines represent minimal and maximal price that was recorded during this timeframe. 

3 Bar chart 

Bar chart is very alike on candle chart by the principle of its constructing. But here goes one continuous segment (bar) and there are levels on those bars, open and close price marks. 

Bar Open Price (open) horizontal line is reflected on the left side. 

Bar close price (close) horizontal line is reflected on the right side. 

High price (high) is the highest price which the bar has reached on the chosen timeframe. 

Low price (low) is the lowest price which the candle has reached on the chosen timeframe. 

4.Line Chart 

Line chart reflects changes of quotes (price) according to time. Line chart is the sequence price’s meanings which are fixed through time interval on the chosen timeframe.