How Do You Trade Charts?

How Do You Read Charts?

In xauusd trading - the chart is the basic tool used by traders to trade the market. The chart will show info about xauusd price movement - the chart will illustrate the general direction of prices - oftenly referred to as trends or xauusd price trends. The chart will also show the ruling xauusd price and the historical movement of chart prices.

Traders use these charts to identify where to place and open trades. From the chart the trader will interpret the price movements using indicators so as to identify and determine the direction of the trend so as to determine the trade to open - whether buy or sell xauusd trade.

Traders must learn how to use charts before they can begin gold.

Following are the different aspects of charts that one will need to know about xauusd charts.

Types of Charts

There are three types of charts

Line Chart - this line chart drawing technique draws a continuous line which connects the closing prices. For example if a xauusd trader is using 15 minute chart then this line chart will draw a continuous line which connects closing price of the market after every 15 minute.

Bar Chart - This bar chart use bars to represent xauusd price movements & draws O.H.C.L. - Opening price, High xauusd price, Low xauusd price, and Closing price for that xauusd time period, for example if the time period used is 15 minute chart, the bar charts will represent the price data & the OHCL gold points for the `5 minutes chart.

Candlestick Charts - These candles charts are the most popular chart types because they're the most visually appealing charts & they represent the price movements in an easily identifiable way which clearly highlights when the prices move up or when the prices move down using different colors to differentiate the direction of price movement. These candles chart look like a candlestick & they have a body that resembles the wax part of a candlestick & an upper & a lower poking line that resembles the wick of a candle.

Chart Time Frames

A chart will draw charts based on different chart time periods - these are 1 minutes trading chart, 5 minutes trading chart, 15 minutes trading chart, 1 hour xauusd chart, 4 hour xauusd chart, 1 day xauusd chart, 1weekly chart & 1 month xauusd chart. The chart time period used to draw chart price data is also referred to as a xauusd chart time frame, for example the 15 minutes trading chart period is commonly known as the 15 minute chart by traders. This 15 minute timeframe will represent xauusd price data for the 15 minutes of trading, after those 15 minute another set of price information will be used to draw another chart representation. For examples if a trader is using candlesticks chart, the price data of one candle-stick will draw xauusd price data of that 15 minute, after those 15 minutes another candle will be plotted using price data of the next 15 minutes - when these candles are combined they then make a graph/ chart representation which highlights the general direction of prices often referred to as the trend. Traders can then use this chart info to make trade decisions.

The most oftenly used xauusd charts are candles charts.

How Do You Interpret Charts?

The candle-stick charts use candle-sticks which have different colors to represent the price move - blue candles show xauusd prices closed higher than they opened - red candles show xauusd prices closed lower than they opened. This candle colour representation is then used by traders to determine when price has headed up/down.

The xauusd candlestick also show OHCL:

O - Opening Price

H - Highest Price

C - Closing Price

L - Lowest Price

These xauusd price points are represented using a formation which looks like a candlestick with wicks on both ends, the distance between opening price & closing price is represented by what's referred to as body of the candle-stick - this part resembles the wax part of a candle. The high xauusd price is represented by a poking line protruding upward - this line resembles the wick of a candlestick - the low xauusd price represented by a poking line that extends downward - this line resembles the wick of a candlestick facing down.

How Do I Analyze Charts?

The Japanese candlesticks patterns techniques also have very many candlesticks patterns that are used to trade the Markets. These xauusd chart patterns have different xauusd analysis & the most common are:

Marubozu & Doji Candles Patterns

Spinning Top Candle Patterns

Reversal Patterns Candlesticks Patterns Candlestick Patterns

Inverted Hammer Candlestick Pattern and Shooting Star Candlestick Patterns

Piercing Line Candlestick Pattern and Dark Cloud Cover Candlestick Patterns

Morning Star Candlestick and Evening Star Candlestick Patterns

How Do I Read Candle Sticks Patterns?

How Do You Analyze Charts? - How Do I Trade Charts? - How Do I Read Charts? - How Do I Interpret Charts?

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