Foreign exchange charts prove to be an inception point for traders following Price Action or technical market analysis. There is mainly 3 popular forex rate chart which is followed by heaps of traders.
Those are as follows:
- Bar charts
- Line charts
- Candlestick charts
Here in this segment, you will get enlightenment regarding all these kinds of forex exchange rate chart. So, if you have entered this volatile realm of currency exchange, refer to this information which exists below!
1st in this list of forex exchange rate chart is a Bar chart. Simply speaking, this genre of chart mainly expresses opening and closing prices of currencies.
Plus it also indicates traders about high and low points which have taken place over a certain period of time.
Here is how you will locate them in a bar chart.
When you formulate a bar chart its vertical bar denotes a currency trading pair wholly!
- At the base of this vertical bar chart denotes the traded price which is the lowest for a particular time period and head of the bar chart denotes the most ascended point which a price has reached.
- Its horizontal hash mark situated on the left position of this bar chart indicates the open price while its horizontal hash indicator located on the right of this bar chart denotes closing price.
(You can check online for such charts or download PDF templates and try to follow it with this information for a more profound understanding)
The 2nd genre of forex rate chart which you as a trader can make use of is a line chart. Though there is some hush-hush stating that these types of charts provide traders with the least possible information, many exponents consider this as not a bad thing.
They, in fact, believe that close price is the most important price of the entire trading day and that is what a line chart focuses on.
The chart is drawn from the point of one closing price to the following closing price. When this line is threaded together along with a line, you will be able to see the usual price movements regarding a currency for a certain time period.
Using this chart with the help of Elliot Wave analysis is a good option.
3rd kind of forex rate chart is the candlestick chart and safe to say; this is the most trusted chart for both experienced as well as newbie forex traders.
Though the information present reveals the same kind of price information, its format makes the chart a lot prettier. In terms of the information displayed, it also shows the price range from high to low over a certain time period.
Large blocks in the middle of the chart indicate the open and close price range and its wicks denote the high and lows of prices.
If this chart is red in color, then it means the closing price is lower in comparison to opening price and if this chart is blue, then it means that close price is higher as compared to open price.
These are some of the basic characteristics of such forex rate chart options. You can make use of free templates available over the web and use the information shared totally to know them properly. These 3 charts will be needed when you make forex trade, so it’s time to get a good hold of them before you dive into the realm of currency exchange.