Artice of the week:
Forex Charts
Understanding 3 Basic Forex charts, Part II
The Forex Bar Chart
A bar chart uses a vertical bar to connect the highest price to the lowest price during a period. Bar Charts can be created for any time period where there is active trading and prices are available. Most traders use the bar chart for hour increments. Bar charts can cover a wide range of other real time prices, such as 30 minutes, 15 minutes, 5 minutes, 1 minute.
• On the left you will find the opening Forex rates. This is displayed
as a horizontal line on the left side of the bar.
• On the right, you will find the closing Forex rates. This is the horizontal
line on the right side of the bar.
The Forex Point Figure Chart
Point and Figure charts are made up of a series of X's and O's that represent the price movements over time.
• The X represents an increase in price
• The O represents a decline in price.
• Look at the box size. The boxes contains a stack of either X's or O's, but seldom both. You can change the scale of charts by the specified box size. The smaller the box, the smaller the time interval. The larger the box, the larger the time interval which it represents.
• View the reversal amounts. A stack of X's represent an upward trend. A stack of O's represent a downward trend. It’s important to note that a new stack forms when Forex rates reverse.
Using Forex charts to learn more about the market is an important part
of any Forex trading strategy. Learn to use the software you plan to trade
with, and practice plotting charts to understand the trends in Forex rates.
Be sure to read up on other essential Forex strategies as well.
