How to Read the Three Types of Stock Index Charts
To read stock index price charts stock index traders will need to first of all learn stock index technical analysis.
This stock index technical analysis study of stock index price movement will analyze historical stock index price moves using stock index trends and stock index chart patterns in an attempt to predict the next likely movement of the stock index price direction.
A stock index chart can be described as a graph representation of the stock index price of a stock index instrument over a specified stock index chart timeframe period.
The stock index charts use the y-axis or vertical axis to represent the stock index price scale and the x-axis or horizontal axis to represent time scale. Stock Index prices are then drawn from left to right with the most recent stock index price being plotted at the furthest point to the right of this stock index chart.
The stock index chart can have different chart timeframes
MT4 Indices Chart Time-frames
M1 for 1 Minutes Stock Index Charts
M5 for 5 Minute Stock Index Charts
M15 for 15 Min Stock Index Charts
M30 for 30 Min Stock Index Charts
H1 for 1H Stock Index Charts
H4 for 4 Hours Stock Index Charts
D for Daily Stock Index Charts
W for Weekly Stock Index Charts
M for Monthly Stock Index Charts
MT5 Stock Indices Chart Timeframes
M1 for 1 Minutes Stock Index Charts
M2 for 2 Minute Stock Index Charts
M3 for 3 Min Stock Index Charts
M4 for 4 Minutes Stock Index Charts
M5 for 5 Minute Stock Index Charts
M10 for 10 Min Stock Index Charts
M12 for 12 Minutes Stock Index Charts
M15 for 15 Min Stock Index Charts
M20 for 20 Minutes Stock Index Charts
M30 for 30 Min Stock Index Charts
H1 for 1 H Stock Index Charts
H2 for 2 Hours Stock Index Charts
H3 for 3 Hours Stock Index Charts
H4 for 4 Hours Stock Index Charts
H6 for 6 Hours Stock Index Charts
H8 for 8 Hours Stock Index Charts
H12 for 12 Hours Stock Index Charts
D for Daily Stock Index Charts
W for Weekly Stock Index Charts
M for Monthly Stock Index Charts
These stock index chart timeframes are used to plot stock index price data movement over the specified stock index chart timeframe period and traders can then analyze stock index price movements from these stock index charts.
Using stock index charts makes it easier for stock index traders to analyze stock index price movements because stock index traders can analyze stock index price trends as well as stock index price patterns.
Stock Index price charts are used to analyze supply and demand for the stock index price movement. And changes in the supply and demand will be depicted in the stock index price movement.
Stock Index technical analysis study is then used to analyze these stock index price movements on the stock index charts. Stock Index technical analysis assumes that all the market information has been factored in the stock index price action movement based on supply and demand for a particular stock index instrument and this supply and demand is depicted in the stock index price action movement that occurs on the stock index charts price movement.
The Three Stock Index Charts Types That are Used in Stock Index Technical Analysis
The three stock index chart types used for stock index technical analysis are:
- Line Chart
- Bar Chart
- Candlestick Chart
Stock Index Line Chart
Stock Index line chart draws a continuous line from one closing stock index price to the next closing stock index price and this then depicts the movement of stock index price of a particular stock index instrument over a period of time on the stock index chart.
Stock Index line charts do not provide stock index traders with a lot of details and information about stock index price movement and the only information plotted by this line chart is of where the price closed for a specific stock index chart timeframe period.
The stock index line chart can be used to interpret stock index trends based on the direction of the stock index line chart movement.
Stock Index Bar Chart
A bar chart is used to show the opening stock index price, the high stock index price, the low stock index price & closing stock index price.
The bar chart will depict the whole stock index price range for each stock index trading period - using the above stock index price data points - opening stock index price, the high stock index price, the low stock index price & closing stock index price.
The vertical bar indicates the stock index instrument trading range as a whole for the period
The top of the bar indicates the high stock index price
Bottoms of the bar indicates the low stock index price
A dash that is drawn to the left of the stock index price bar indicates the opening stock index price
A dash that is drawn to the right of the stock index price bar indicates the closing stock index price
Stock Index Candle Chart
A candlestick chart is used to show the opening stock index price, the high stock index price, the low stock index price & closing stock index price.
A stock index candle chart is represented in a easier to read & interpret format compared to the stock index bar chart.
Candle stock index charts represent the same data as that of a bar chart but in a much easier to analyze format.
Stock Index Candles have two parts: the body of the candle & the shadow of the candlestick
Stock Index candlesticks have a body which is the difference between the opening stock index price & closing stock index price. The body of the stock index candlestick will have different colors depending on the direction of the stock index price.
Blue or Green Candlesticks for when price moves up
Red Candlesticks for when price moves down
The stock index candlesticks also have protruding lines above and below the body of the stock index candlestick - these protruding lines are known as shadows. The upper shadow represents the high stock index price & the lower shadow represents the low stock index price.
How to Read the Three Types of Stock Index Charts
