How Do I Analyze Stock Charts?
Trading Stocks Read Stocks Charts
In stocks - the stock chart is the basic stocks tool used by traders to trade the stock trading market. The stocks chart will show information about stocks price movement - the stock chart will show the general direction of stocks prices - commonly known as stocks trends or stocks price trends. The stocks chart will also show the current stocks price & the historical movement of stocks chart prices.
Traders use these stocks charts to identify where to place and open stock trades. From the stock chart the trader will analyze the stocks price movements using stocks technical indicators so as to identify and determine the direction of the trend so as to determine the stocks trade to open - whether a buy or a sell stocks trade.
Traders must learn how to use stocks charts before they can start trading stocks.
The following are the different aspects of stocks charts that a trader will need to know about stocks trading charts.
Types of Stock Charts
There are three types of stocks trading charts
Line Chart - this line chart method draws a continuous line that connects the closing stocks prices. For example if a trader is using the 15 minutes chart then this line chart will draw a continuous line that connects closing stocks price of the stock market after every 15 minute.
Bar Chart - This bar chart use bars to represent stocks price movements and draws OHCL - Opening stocks price, High stocks price, Low stocks price, and Closing stocks price for that stocks chart time period, for example if the stock chart time period used is 15 minutes chart, the bar chart will represent the stocks price data and the OHCL stocks trading points for the `5 minute chart.
Candlestick Charts - These candlesticks charts are the most popular stocks chart types as they are the most visually appealing stocks charts and they represent the stocks price movements in an easily identifiable way which clearly shows when the prices move up or when prices move down using different colors to differentiate the direction of stocks price movement. These stocks candlesticks chart look like a candle and they have a body that resembles the wax part of a candle and an upper and a lower poking line that resembles the wick of a candle.
Stock Chart Periods
A stocks chart will draw stocks charts based on different chart time periods - these are 1 minute chart, 5 minute chart, 15 minute chart, 1 hour stocks chart, 4 hour stocks chart, 1 day stocks chart, 1week stocks chart & 1 month stocks chart. The stocks chart period used to draw stocks chart price data is also known as a stocks chart timeframe, for example the 15 minute chart period is commonly referred to as the 15 minute chart by traders. This 15 minute chart timeframe will represent stocks price data for the 15 minutes of stocks, after those 15 minutes another set of stocks price data will be used to draw another stocks chart representation. For example if a trader is using candles chart, the stocks price data of one stocks candle will draw stocks price data of that 15 minutes, after those 15 minute another stocks candle will be drawn using stocks price data of the next 15 minute - when these stocks candlesticks are combined they then make a stocks trading graph/ stocks chart representation that shows the general direction of stocks prices commonly known as the stock trend. Stocks traders can then use this stocks chart information to make stocks decisions.
The most commonly used stocks charts are candlesticks charts.
How to Trade Candlesticks Charts
The stocks candlestick charts use candlesticks that have different colors to represent the stocks price move - blue stocks candlesticks show stocks prices closed higher than they opened - red stocks candlesticks show stocks prices closed lower than they opened. This stocks candle color representation is then used by traders to determine when price has moved up or down.
The stocks candlesticks also show OHCL:
O - Opening Stocks Price
H - Highest Stocks Price
C - Closing Stocks Price
L - Lowest Stocks Price
These stocks price points are represented using a formation which looks like a candle with wicks on both ends, the distance between the opening stocks price & closing stocks price is represented by what is referred to as the body of the stocks candlestick - this part resembles the wax part of a candle. The high stocks price is represented by a poking line protruding upward - this line resembles the wick of a candlestick - the low stocks price represented by a poking line that extends downward - this line resembles the wick of a candle facing down.
Stocks Candlesticks
The Japanese candles patterns techniques also have very many candles patterns that are used to trade the Stocks Markets. These stocks chart patterns have different technical analysis & the most common are:
Trading Stocks Read Stock Candlesticks Patterns
How Do You Analyze Stocks Charts? - How Do I Trade Stock Charts? - How Do You Read Stocks Charts? - How Do You Interpret Stocks Charts?
