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How to read stock charts?


Lisa O'Neill
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Hello, thank you for asking! 

The first important thing about stock chart reading is to identify the type of chart. They can be a bar, candlestick, line, and point and figure charts. The second thing is that an analyst or a trader should have a basic understanding of components on charts, such as summary key, time period, moving averages, volume, and daily trading average.

 

Volume is one of the most important parts of stock charts, as it represents the number of stocks traded, whether it is a purchase or a sale. The importance of tracking volume is to recognize the shift of resistance and support lines. By knowing the total volume on a day, you can understand the power of influence on a given stock and how much of “real money” are behind specific market moves.

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Tables are convenient to use when you need to get information on trading for a specific day: on Tuesday the asset closed at 55, and on Wednesday - at 65. Minus: it is difficult to see the trend - how much the asset price rises or falls. It is possible to perceive the direction and change in the price of a security according to the table, but it is more difficult to do it than according to the schedule. It is convenient to track the change in time of a single parameter using a line graph. If we have only plotted the closing price on the line chart, then all the data from the table are visible on the candlestick chart: the opening and closing prices of trades, the maximum and minimum values of the price for a trading session. There are on https://tickertable.com/best-income-stocks/ some exapmles of it. The bar chart shows the same parameters as Japanese candlesticks. The only difference is the display.

 

Edited by anny kidsman
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