Stock price charts are an essential tool for trading. It allows both newbies and seasoned traders to better interpret market trends and make informed trading decisions. In this blog, we’ll discuss several types of stock price charts that may help you refine your trading approach. Let’s begin!
4 Types of Stock Price Charts
Here, we’ve mentioned four main types of stock price charts. You can also enroll in technical analysis classes to learn more.
Line Charts
One of the most basic types of stock price charts is the Line Chart. This chart plots a line connecting the closing prices of the stocks over a specific period of time.
It showcases a straightforward view of the stock price movements and serves as an important option for beginners.
Key Features:
- Reflects closing prices.
- Showcase general price trends.
- Befitting price chart for beginners.
Bar Charts
Bar Charts are other stock price charts, where each bar represents one period that may be daily, weekly, etc.
It shows opening, high, low, and closing prices (popularly known as OHLC).
The top of the bar simply represents the highest price during the specified period, while the bottom represents the lowest price.
Key Features
- It may help you determine price volatility.
- Showcases OHLC prices.
- Allows you to understand the broader view of market sentiment.
Candlestick Charts
Candlestick Charts are one of the popular forms of price charts in trading. It shows detailed price information and visual appeal.
Like Bar Charts, these charts also represent OHLC, but in a more visually intuitive manner.
Moreover, the candlestick chart has a body and two wicks (also known as Shadows), representing the high and low prices during the specified period.
It consists of two types of shadows: Green and Red. A green candle (hollow candle) represents that the closing price was higher than the opening price, indicating bullishness. The red candle (filled candle) shows that the closing price was lower than the opening price, indicating bearishness.
Key Features:
- Represent detailed price action.
- It is widely used and accepted in technical analysis.
- Enables you to easily determine trends and patterns.
Point and Figure Charts
Point & Figure (P&F) are unique types of charts that help traders visualize price movements and trends in the financial markets.
These charts are significantly different from others as they don’t plot price against time. Instead, it plots the price against changes in direction.
P&F typically uses X’s and O’s to represent rising and falling prices, respectively. It mainly helps identify trends and reversals without the distraction of minor price movements.
Key Features:
- Helps in determining strong support and resistance levels.
- Ignore minor fluctuations.
- Focus more on long-term price fluctuation.
Conclusion
In summary, stock price charts play a crucial role when it comes to succeeding in the stock market. Whether you’re a beginner or an experienced trader, you can use these charts to exercise the best technical analysis. Upsurge.club offers an in-depth technical analysis course in Hindi and English, which you can leverage for trading.
