In currency trading sale of one currency and purchase of another currency takes place. Forex market is a very active and most liquid market in the world. Enormous amount of transaction takes place within a second and daily turnover is estimated to reach trillions of dollars. If you do not use an analytical tool such as Forex charts, then it will become difficult for you to survive in the Foreign exchange market. These charts are visual aids that make the trading trends and patterns easier. These charts can be put in different categories according to the time frame and price movement. If you have a 4hr candlestick chart, it means that each candlestick on the graph shows the price data for a four hour long period.
Reading a currency trading chart is not so easy. They look quite complicated at first glance. Forex charts look different depending for what option you want to use them. Forex charts have settings for the display of the price and time frame that a trader wants to see. Time frame can vary from 1 second to 1 month. Price is usually displayed as candlestick, a line or bar.
Online trading charts have different display modes for the display of the price. One such method by which price can be displayed is known as Japanese candlestick. Candlestick charts are the most common display method used for showing the price on a Forex chart. There are many theories to understand candlestick pattern for predicting the price. Basically Candle chart shows in the mentioned time frame shows Open, Close, High & Low prizes.
Another way of displaying price in currency trading is by a line. Line charts are good and simple way to display price. Line chart shows the closing price for each period. Bar chart is another method used to display price. A bar chart shows you the opening price, highest, lowest and the closing price. You must know how to read a chart so that you can apply technical analysis. Every trader does not believe in using technical analysis but it can be beneficial.
Charting system provides different time frames ranging from one second to monthly bars. The smaller time frames i.e. 5 minutes and 15 minutes are best for day traders. They are also beneficial for swing traders looking for a perfect time to enter the market. The 1hr Forex trading chart is generally for swing traders and long term traders who are looking for a momentary trend. The 4hr chart is beneficial for long term trade. This chart is best for the traders who want to make a careful entry. The daily chart is best for setting a long term position on a particular currency pair. Viewing a currency exchange pair in different time frames will help you to decide good entry and exit points according to the strategy which you want to use.
- As beginner trader – it is recommended to start with the Candle stick chart, all professional trader uses candlestick chart or bar chart.
- Once you started your trading, please don’t and never ever start with the low time frame candlestick chart. It is going to put more risk on your money & more pressure on your head to work at high speed just like super computer. So even if you know the fundaments & doing well on paper, practically you will stumble and start doing blunders knowingly or unknowingly.
- So for a beginnerit is must to exercise oh Weekly, Daily and then H4 candle chart.
- Then and then only once you gain confidence you can think of low time frame.
- That is why 90% of traders are outdated. They are in hurry of making money. Hurry in becoming millionaire overnight.
- Yes it’s true everyone of us can earn money fast. Get rich quickly “only if We are ready to follow the rules & process”
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