In order to study how the price of a traded security moves, a trader needs some sort of way to look at its historical and current price behavior.A price chart is usually a preferred first tool that most of the traders use for technical analysis
A chart is simply a visual representation of a traded security’s price over a set period of time.
On the chart, the y-axis (vertical axis) represents the price scale and the x-axis(horizontal axis) represents the time scale. Prices are plotted from left to right across the x-axis.
A chart aggregates every buy and sell transaction of that financial instrument (in our case, currency pairs) at any given moment. A price chart depicts changes in supply and demand.
Below are the some of the most popular types of Price Charts
- Line chart
- Bar chart
- Candlestick chart
Charts are useful because they make it easier for us to present securities being traded in a visual and organized manner.
Charts blend all activity from the millions of market participants of all types and it doesn’t matter whether they’re humans or machines!