Today we will discuss the most popular types of Forex Charts.These are the charts used most of the forex traders to predicts the next movement.
- Line Chart
- Bar Chart
- Candle Stick Chart
Line charts are drawn by simply connecting the sessions Open, Close, High & low prices in one single line.The main advantage of line charts is it gives clear support and resistance after filter out the market noise.
The bar chart shows Open, Close, High & low prices for each given session or time frame.Each bar consists of a horizontal line with a bars upside and downside.
The top of the vertical line shows the High price of each session whereas the bottom of the vertical line shows the lowest price of specific time frame.
The left & right horizontal bar of the vertical line shows the closing and opening price of that time frame bar.
Below is the example, how to read bar charts and bullish bearish bars.
Candle Stick Charts
Candlestick charts display the same information as a bar chart.The visual representation 0f candlestick charts are a lot better as compare to a bar chart.
The colored blocks are called the candle body.The vertical lines above and below the bodies are called upper and lower shadow of the candlestick.The upper and lower shadow of the candlestick also represents the high and low prices of specific time frame.
The difference between the bullish vs Bearish candle is the difference between opening and closing prices which are mentioned in the chart below.
Below is the example of candlesticks.We will also discuss how to read candlestick charts and different candlestick bodies in our next lessons.
Note: The color of the candlestick doesn’t matter because in the most trading platform you can change the color of the candlestick body according to your choice.