Various Type Of Forex Charts
For sure, there isn’t any doubt in my own mind that head and shoulders above all existing charting methods, so called candlestick charting is definitely the best one which has been actually adopted by a big number of different successful foreign currency traders. In fact, I obviously read somewhere that every person who has really read and also understood this kind of charting is never going to revert to some other charting type. Without any doubt, one of the most essential and vital factors which I personally stress all the time to these person whom I coach is that their knowledge is one thing, but implementation is clearly everything.
Of course, that’s why understanding the charts and also being capable to utilize them in your trading is very helpful and useful tool. Well, historically there have been several various chart types: line charts, point and figure charts, candlestick charts, bar charts. Thus let’s take a look at the main elements of every chart type.
First of all, we will talk about point and figure chart. So that type if technique for charting was quite often filled in at the very end of the day by many foreign currency traders. Besides, that was one of the first charting methods to be actually computerized more than fifty years ago. However, this kind of technique is known as well as so called tick tack toe charting strategy. In fact, this type of charting is quite different to all other ones which are commonly utilized and it also doesn’t really plot price against time as those other various techniques certainly do.
Secondly, let’s talk about line charts. Well, this chart is definitely simple line chart which draws a line from one price to another similar price. In addition, that may obviously be closing, opening, low, average and also high price. And for every time period those certain points are clearly connected with this line, we are able to see the price movement of your currency pair over some period of time.
Thirdly, let’s mention bar charts. This kind of chart is known as well as so called OHLC because it definitely shows the opening price, the low price, the high price and also the closing price – all within some given period of time. Additionally, that period may possibly be as short as only one second and even as long as one year.
And finally, we will discuss candlestick charts. Of course, this type of chart actually shows just the same data as a bar chart, however, in more user-friendly format. Thus these charts indicate the essential high-to-low range with one vertical line. But still in this candlestick charting, the bigger block in the middle clearly indicate the true range between closing and opening prices.