Forex Charts

Forex trading charts. What are Forex Charts & How Do You Read Them?
A forex chart is a graphical representation of price movement over a specific period pf time and is composed of an x-axis (time) and y-axis (price). The choice of the time frame employed depends on the user’s need. It is obvious that an intra-day scenario will not be based on monthly chart.

Forex Tick Chart
Tick chart has the finest scale – 1 tick (individual quoting of bid and ask prices by market-maker). It is the chart of Bid and Ask quotations which look as columns on the chart of the prices.
The maximum of each separate column is Ask, the minimum of each concrete column is Bid.
As a rule tick chart is not used for the analysis of the market as its scale is so small that does not approach for the technical analysis. However tick charts are effectively used for exact definition of support and resistance levels and also to raise efficiency of purchases and sales, making it on local minima and maxima.

Forex Line Chart
A line chart shows a line connecting the “closing prices”. The closing is the last price recorded at the end of a specific period of time (session).
A line chart’s strength comes from its simple design; it provides an uncluttered, easy to understand view of a currency’s price. Line charts display the currency’s closing price.

Forex Bar Chart
Bar charts provide more detailed information compared to Line chart. Basically all characteristics mentioned for the line chart also hold true for the bar chart. However, the construction is a different one. The bar chart is composed of a high (highest price during a session), a low (lowest price during a session) and the close. 
All that is required is to draw a vertical line (bar) from the high to the low. Then, set a horizontal dot from the vertical line to the right, representing the close. Sometimes users refer also to the opening price; a dot drawn on the left side of the bar. The bar chart is the most popular chart is used in forex trading today.
On a daily bar chart each bar represents one day’s activity. The vertical bar is drawn from the day’s highest price to the day’s lowest price. Closing price and opening price are represented by ticks on the bar.
Bar chart is graphic representation of price action using a vertical bar to connect the highest price to the lowest price during a period. The opening price is displayed as a horizontal line on the left side of the bar. The closing price is displayed as a horizontal line on the right side of the bar. Bar Charts can be constructed for any time period in which prices are available. Traditionally, the most popular time interval for bar chart is hourly chart. However, since the wide availability of the real time prices, it is common to use smaller time interval such as 30 minutes, 15 minutes, 5 minutes, 1 minute.

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David