Basic Forex Education_10. Types of Forex Charts

Lesson 10: Types of Forex Charts

When there’s a simple line that connects the open, low, high, and closing
price, it is known as a line chart. This chart will look clean and there will not be any
market noise captured in this chart, giving a clear indication of the resistance and
support levels.
Bar charts show us the opening, closing, low and high prices for each given section.
The horizontal line on the left shows the opening price.

The bottom of the vertical line shows the lowest price at a specific time period. The
top of this line shows the highest price at a specific time period.
The horizontal line on the right shows the closing price. This is the most popular type
of chart. In most trading literature you will find charts displayed exactly like this.
Candlestick charts display the same information as bar charts but the visual
representation is a lot better. The big blocks are called real bodies.
On top of the vertical lines of the block, you will notice the upper shadows and the
lines that are under it are known as lower shadows. Usually, if the real body is in a
lighter color, the currency closed above its opening price.
But if the real body is in a darker color, the currency closed lower than it opened.
Don’t worry about the colors for now because, in most trading platforms, you can
easily customize them as you like.
The main advantage over any other chart is the excellent visual representation that
the candlestick provides. It shows clearly who is in control; bulls or bears.
I can’t say any of the charts are better than others but I would advise beginners to
stick with candles for now.