How to Read Forex Charts Beginner Traders Tutorial - Forex Patterns & Forex Charts Analysis
Forex Charts Analysis Technical Analysis - Forex Charts Analysis Strategies
There are Three types of charts used in Forex: Line Chart, Bar Chart and Candlesticks Chart - how to read forex charts beginner traders PDF.
How to Read Forex Chart Analysis
Line Charts - forex line charts plot a continuous line connecting closing prices of a currency pair.
Forex Line Charts - How to Read Forex Charts Beginner Traders Guide
Bar Chart - forex bar charts are displayed as sequence of OHCL bars. O H C L represents OPEN HIGH LOW and CLOSE. Opening price is displayed as a horizontal dash on the left & closing price as a horizontal dash on the right.
Forex Bar Charts - How to Read Forex Charts Beginner Traders Guide
The main disadvantage of forex bar chart is that it is not visually appealing, therefore most traders don't use them.
Candlesticks Charts - these candles charts use the same price data as forex bar charts (open, high, low, and close). However, they are displayed in a much more visually identifiable way which looks like a candlestick with wicks on both its ends.
How to Interpret Candlesticks Charts
Rectangle part of the candlestick is called the body.
The high & low of the candlestick are described as shadows and plotted as poking lines.
Candlesticks Charts - How to Read Forex Charts Beginner Traders Guide
The color of the candlestick is either blue or red:
- (Blue or Green Color Candles) - Forex Prices moved up
- (Red Color Candlesticks) - Forex Prices moved down
Most Forex trading platforms like the MT4 Software, use colors to mark the direction of the forex price. Candles colors used are blue or green: when price moves upwards, color of candlestick is blue: when price moves downward, color of candlestick is red.
Candlestick Charts vs Bar Charts - How to Read Charts Beginner Traders PDF
When Forex candlesticks charts are used it's very easy to see if the price moved up or down as opposed to when bar charts are used.
The Japanese candles charts techniques also have very many candlesticks formations which are used to trade the Forex Markets. These forex chart patterns have different technical analysis explanation & the most common are:
| Reversal Patterns Candles Patterns Trading Candles Patterns |
How to Read Forex Chart Patterns Beginner Traders PDF
The above candlesticks patterns is what makes the Japanese trading candles patterns popular among forex traders & it is why this type of technical forex chart analysis are the most widely used when it comes to analyzing the FX market. The analysis for these forex charts pattern formations in Forex trading is the same as that one used in stocks trading.
