The Six Different Types of Forex Charts
What are the Different Forex Chart Types?
There are several different types of forex charts used in forex technical analysis and these forex charts are explained below.
A trader can use this forex chart types tutorial to find out which forex chart types are best for them to use when analysis the forex market forex price movement:
Line Charts
Line forex charts are basic forex charts that only draw a continuous line connecting closing forex price from one forex chart timeframe period to the next.
Forex line chart provides forex price data as a continuous line that connects a series of forex closing prices.
The forex line chart will not draw other forex price information such as the high of the forex price, the low of the forex price & the closing of the forex price.
Forex traders can also use forex line charts to identify and trade forex technical analysis patterns such as double top & double bottom.
Forex traders can also use forex line to identify forex trends & to draw forex trend lines on these forex line charts.
Bar Charts
Forex bar charts will show the forex price action data of a particular forex chart timeframe period.
The forex bar chart will show high price, low price, open forex price and close forex price.
The bar chart will be represented by a vertical line that represents the bar and then there will be a small dash to the left of this vertical bar showing the opening forex price and another small dash to the right of this vertical bar showing the closing forex price.
A forex bar will continue and start plotting from where the previous forex price bar left.
Forex traders can also use forex bar charts to identify and trade forex technical analysis patterns.
Forex traders can also use forex bar charts to identify forex trends & to draw forex trend lines on these forex bar charts.
Forex Candles Charts
Forex candlesticks charts are used to represent all the data of the forex price action movement which includes: high price, low price, open price and close price.
A forex candlestick has two parts the body of the forex candlesticks and the shadows of the forex candlestick.
The body of the forex candlestick shows the forex price action between opening forex price and closing forex price. The body of the candlesticks will have different colors depending on the direction of the forex price movement, blue or green candles when price moves up and red forex candles when price moves down.
The length of the body of the candlesticks will determine how much forex price movement there was between the opening forex price and closing forex price for a particular forex chart timeframe period.
The lower and upper thin lines protruding out of the candlestick body are known as shadows and the bottom and top of these shadows represent the low and high forex price of a particular forex price period.
A lot of information can be analyzed by forex trades from the body and the shadows of a forex candlestick.
Forex candlesticks patterns is a forex technical analysis study that explains how to read forex candlesticks and how to interpret forex signals from these forex candles patterns.
These forex candlesticks patterns include:
- Doji Forex Candle
- Marubozu Forex Candle
- Hammer Forex Candle
- Inverted hammer Forex Candle
- Shooting Star Forex Candle
- Piercing Line Forex Candle
- Dark Cloud Cover Forex Candle
- Morning Star Forex Candle
- Evening Star Forex Candle
- Bullish Engulfing Forex Candles
- Bearish Engulfing Forex Candles
Heikin Ashi Charts
Heikin-Ashi is Japanese & means average bar.
Heikin Ashi charts are used because it is easier to identify forex trends using Heikin Ashi Charts
Heikin-Ashi charts look like forex candlesticks but are calculated using a different technique.
These Heikin Ashi candle forex price point are calculated as follows:
Opening Price - Opening price is calculated as the average of the opening and closing price of the prior candlestick
High Price - the high price of Heikin Ashi candlestick is selected from one of the following data points of the previous candlestick - high, opening price and closing price - depending on which has the highest value
Low Price - the low price of Heikin Ashi candlestick is selected from one of the following data points of the previous candlestick - low, opening price & closing price - depending on which has the lowest value
Closing Price - Closing price is calculated as the average of the opening price, high price, low price & closing price of the prior candlestick
Heikin Ashi forex charts generate forex trading signals which are slower as when compared to forex candles charts & this is because of the method of calculation used to plot the Heikin Ashi forex trading charts.
The slower forex signals generated by Heikin Ashi forex charts can be used to trade more volatile forex prices because this Heikin Ashi forex charts delays in reacting to forex prices will help prevent forex traders from trading forex whipsaw signals.
Heikin Ashi forex charts have less forex whip saw trading signals because of the delay in calculation of the forex prices.
Renko FX Trading Charts
Renko forex charts adds a square block on the forex chart when the price moves by a certain specified distance.
Renko charts are also used to filter out the time when the forex market is consolidating
When forex price moves by this distance the Renko charts adds another square block.
The square block will be added in direction of the forex price move.
Renko forex charts are used to spot the forex trends and trade these forex trends.
Point & Figure Forex Trading Charts
The point & figure charts are used to filter out the time when the forex market is consolidating
Point & Figure charts are drawn with X and 0 columns which are vertical.
Point & figure charts are used to compress time using the point & figure forex chart representations because point & figure adds a new X or 0 vertically rather than next to the previous point and figure and only when the point & figure calculates the forex trend to have changed then a new vertical bar is then added to the right side of the point & figure charts.
Point & Figure forex charts are used to spot the forex trends and trade these forex trends.
The Six Different Types of Forex Charts Used in Forex Trading
