In this article we will drive in the most practical of online trading : Learn How to Read Forex Charts with the We-Point Indicator.
The chart shows the trend of a cross Forex, for example, a currency related to another currency like EUR/USD or an Stock Index like DAX.
Line charts are the most common and most used in the Forex industry. Example:
The horizontal axis shows the time and the vertical axis shows the closing prices per unit of time. The passage of time creates a trend line of the price. The collection of data on the time axis occur at different times in slang is called time- frame (TF). The time- frame can be set from the monthly tick ( tick, 1 minute, 5-15 minutes, 1-4 hours, daily and monthly) and some online trading platforms allow you to customize the time- frame. The graph above has been used on a daily time- frame , where it is then registered the closing price of each day.
The line charts, however, fail to give information on how the price has moved during the time-frame. Bar charts have become the most widely used by online traders. These graphs allow you to specify:
• opening price
• closing price
• minimum and maximum
So a chart bars allows to synthesize the whole trend of the cross Forex during the chosen time- frame and are really easy to read.
They are graphs of Japanese origin and are experiencing a time of intense interest among traders because in addition of giving the information already found with the bar graphs , their configuration over time creates the so-called "patterns" that give us more information on the performance of cross Forex.
Reading them is extremely simple, even more than the bar charts, thanks to the colors that stand out the candles bearish – bullish . The real strength of the charts candles is the combination of their figures that give us signs of a reversal or a continuation.
Trading with We-Point Indicator and CandleStick Charts on Metatrader