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Chapter 7, Part I. Chart types. Page 6

Discussion in 'Complete Trading Education- Forex Military School' started by Sive Morten, Dec 15, 2013.

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  1. Sive Morten

    Sive Morten Special Consultant to the FPA

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    Pipruit: And what is a tick chart?​

    Commander in Pips: A tick chart is a special type of chart. It has no time structure, so you can’t set it up to do hourly or daily. This chart just shows you each trade that takes place on the market and links the price of these trades by the line. As you understand, each trade happens at precise price, so there is cannot be any high, low, open and close. All of them are just a single price – the actual trade price. This is a very fast chart, especially on liquid markets, and it rarely used, especially for technical analysis.

    Tick Chart Example
    [​IMG]
    3. Candlestick chart

    This kind of chart cares about absolutely the same information as z bar chart, but it looks a bit different. Just take a look at the chart #6, what can you tell about it?

    #6 4-hour AUD/USD Candlestick chart
    [​IMG]

    Pipruit: Hmm... it strongly reminds me the bar chart, as you’ve said. Two different colors stand, I think, for downward period (black candles) and to the upward period (white candles). I think that spikes from each candle show high and low. But how interpret these blocks…

    Commander in Pips: Good, so let’s look at candles in details to clarify all things:

    [​IMG]
    As you can see any candle consists of a body (block in the middle of the candle) and two shadows - upper shadow and lower one. Shadows show high price and low price for trading period correspondingly – there is no difference with this and a bar. But, as you can see, there is a difference to bar charts, the candle does not have any dashes from one and another side of the body. It has colored body instead. The borders of the body do show the open price and the close price, but which one stands for open and which one for close determines by the color of the candle. In our example white candle (as we understand from chart #6) stands for an up move, hence the lower edge of the body stands for the open price and the upper one for the close price. A black candle, in turn, shows a downward period – it means that upper edge of the body shows the open price and lower edge shows the close price. Traditionally, colored or filled candle shows down move, blank, the upmove. Our downward candle is filled with black.
     
    #1 Sive Morten, Dec 15, 2013
    Lasted edited by : Feb 10, 2016
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