Types of Charts - Candlestick - Bar Chart - Line Chart

Types of charts Here, we are not going

to teach useless and non-functional information, so without wasting time, we will go to the topics

that are essential for a trader to know. In general, we have many charts but we

mostly use candlestick charts for analysis Before we get into the topic of candlesticks,

I want to you to know about two charts, the line chart and the bar chart.

The line chart can be defined as follows: The line chart is formed by connecting the

final prices of the specified time period For example, in this chart, we have the

daily line chart of Bitcoin, which is formed by connecting the final prices of each day

We use line charts in technical analysis in specific cases,

which we will teach you in the next videos

Another chart that I want you to learn is the bar chart, which by understanding this type of chart,

you’ll be able to understand the candlestick much better.

Here is the daily bar chart of Gold There are four important pieces in each bar:

the first line on the left shows the opening price of the day, after that the bar shows the highest

and lowest price of the day, and the last line on the right shows the closing price of the day.

Different colors are used to make it easier to visually understand the market,

where we see the Bullish bar in green and the Bearish bar in red.

So, if the closing price is higher than the opening price of the day, the bar will be green.

And vice versa if the right line or in other words the closing price is lower than the left line,

the bar will be red, so we had a bearish day. In the next video, we will see why the daily

time frame is *important* and the examples in this video are all about

daily time frame but as we have learned so far, you can choose any time frame,

the left line is the opening price and the right line is the closing price for that time frame.

If we want to make it simple, we can say that candlestick is like a bar chart, it shows four

prices, the opening, the highest, the lowest and the closing price but the main difference

is that the candlestick has two very important characteristics, the shadow and the body.

Japanese candlestick chart In fact, the distance between

the opening price and the closing of the candle is called the Body, and the distance between

the candle’s body and the highest and the lowest price, which is a thin line, is called shadow.

And from now on, we call the beginning of the body, open and the end of the body, close,

and instead of the word "highest price" we use the word "high" and instead of the word

"lowest price" we use the word "low". We also use the Heikin-Ashi chart in

some strategies to get the entry point in Scalp and Day-Trading,

and we will definitely discuss these topics in the videos in the advanced chapter.

To support us, make sure to like the video and subscribe to the

channel in order not to miss the next videos In another video, we will learn some of the most

important candlestick patterns and also describe the regular and logarithmic scales in the chart.