The Six Different Types of Stock Charts
What are the Different Stock Chart Types?
There are several different types of stocks charts used in stock technical analysis & these stock charts are explained below.
A trader can use this stock chart types tutorial to find out which stock chart types are best for them to use when analysis the stock market stock price movement:
Line Stock Charts
Line stock charts are basic stock charts that only draw a continuous line connecting closing stock price from one stock chart timeframe period to the next.
Stock line chart provides stock price data as a continuous line that connects a series of stock closing prices.
The stock line chart will not draw other stock price information such as the high of the stock price, the low of the stock price & closing of the stock price.
Stock traders can also use stock line charts to identify & trade stock technical analysis patterns such as double tops & double bottoms.
Stock traders can also use stock line to identify stock trends and to draw stock trend lines on these stock line charts.
Bar Stocks Charts
Stock bar charts will show the stock price action data of a particular stock chart time-frame period.
The stock bar chart will show high price, low price, open stock price and close stock price.
The bar stock chart will be represented by a vertical line that represents the bar and then there will be a small dash to the left of this vertical bar showing the opening stock price and another small dash to the right of this vertical bar showing the closing stock price.
A stock bar will continue and start plotting from where the previous stock price bar left.
Stock traders can also use stock bar charts to identify & trade stock technical analysis patterns.
Stock traders can also use stock bar charts to identify stock trends and to draw stock trend lines on these stock bar charts.
Stock Candlesticks Charts
Stock candlesticks charts are used to represent all the data of the stock price action movement which includes: high price, low price, open price and close price.
A stock candlestick has two parts the body of the stock candlesticks and the shadows of the stock candle.
The body of the stock candlestick shows the stock price action between opening stock price & closing stock price. The body of the candlesticks will have different colors depending on the direction of the stock price movement, blue or green candlesticks when stock price moves upwards & red stock candlesticks when stock price moves down.
The length of the body of the candlesticks will determine how much stock price movement there was between the opening stock price & closing stock price for a particular stock chart time-frame period.
The lower and upper thin lines protruding out of the candlestick body are known as shadows and the bottom and top of these shadows represent the low and high stock price of a particular stock price period.
A lot of information can be analyzed by stock trades from the body and the shadows of a stock trading candle.
Stock candlesticks patterns is a stock technical analysis study that explains how to read stock candlesticks and how to interpret stock signals from these stock trading candles patterns.
These stock candles patterns include:
- Doji Stock Candlestick
- Marubozu Stock Candlestick
- Hammer Stock Candlestick
- Inverted hammer Stock Candlestick
- Shooting Star Stock Candlestick
- Piercing Line Stock Candlestick
- Dark Cloud Cover Stock Candlestick
- Morning Star Stock Candlestick
- Evening Star Stock Candlestick
- Bullish Engulfing Stock Candles
- Bearish Engulfing Stock Candles
Heikin Ashi Charts
Heikin-Ashi is Japanese & means average bar.
Heikin Ashi charts are used because it's easier to identify stock trends using Heikin Ashi Charts
Heikin-Ashi charts look like stock candles but are calculated using a different method.
These Heikin Ashi candlestick stock price point are calculated as follows:
Opening Price - Opening price is calculated as the average of the opening and closing price of the prior candleHigh Price - the high price of Heikin Ashi candle is selected from one of the following data points of the previous candle - high, opening price & closing price - depending on which has the highest value
Low Price - the low price of Heikin Ashi candle is selected from one of the following data points of the previous candle - low, opening price and closing price - depending on which has the lowest value
Closing Price - Closing price is calculated as the average of the opening price, high price, low price and closing price of the prior candlestick
Heikin Ashi stock charts generate stock signals which are slower as when compared to stock candlesticks charts & this is because of the technique of calculation used to plot the Heikin Ashi stock charts.
The slower stock signals generated by Heikin Ashi stock charts can be used to trade more volatile stock prices because this Heikin Ashi stock charts delay in reacting to stock prices will help prevent stock traders from trading stock whipsaw signals.
Heikin Ashi stock charts have less stock whipsaw trading signals because of the delays in calculation of the stock prices.
Renko Stock Trading Charts
Renko stock charts adds a square block on the stock chart when the stock price moves by a certain specified distance.
Renko charts are also used to filter out the time when the stock market is consolidating
When stock price moves by this distance the Renko charts adds another square block.
The square block will be added in direction of the stock price move.
Renko stock charts are used to spot the stock trends & trade these stock trends.
Point and Figure Stocks Trading Charts
The point and figure charts are used to filter out the time when the stock market is consolidating
Point and Figure charts are drawn with X & 0 columns which are vertical.
Point and figure charts are used to compress time using the point & figure stock chart representations because point and figure adds a new X or 0 vertically rather than next to the previous point & figure & only when the point & figure calculates the stock trend to have changed then a new vertical bar is then added to the right side of the point & figure charts.
Point and Figure stock charts are used to spot the stock trends & trade these stock trends.
The Six Different Types of Stock Charts Used in Stock Trading
