You get information about the trend of an investment instrument, and you trade accordingly. Detects price fluctuations and live forex movements; You get your earnings from the moves you make. The most reliable way to identify Forex trends is to use technical analysis methods. As you can understand from this chain, the way to make money with forex is to read the charts correctly and integrate these analyzes into investments. So, how to read forex charts?
Basic Rules of Reading Charts in Forex
The first rule in chart reading, which is considered the most important stage of technical analysis, is to have information about what the charts mean. You need to lay your foundation by learning the meanings of graphs and the information they provide. Once you know about the meanings of the lines, you can see the forex instant price charts on MetaTrader trading platforms and simply grasp which direction the investment tool will take. The second rule is to follow the charts regularly. All you have to do in this simple online transaction is to check the charts regularly. But first, it is useful to mention which graphics you will use.
Types of Forex Charts; Line Charts
It is the simplest type of chart to use, providing basic information. Line charts are drawn relative to the closing price. In this chart, you only see the closing prices. They allow you to quickly comment on price changes when you don’t have time.
The most used chart type is the candlestick chart. Candlestick charts, a Japanese invention, show supply-demand ratios. Each candle body gives information about the highest and lowest price parities in the specified time period. In the upper region, it shows the highest price and the higher of the opening and closing prices, while the bottom part indicates the lowest price and the smaller of the opening and closing prices. The middle part of the candle indicates to the investor that the price is going up or down. Different colors represent the price movements shown in the body.
It shows the same details as candlestick charts. Bar charts are less preferred because they are not as easy as candlestick charts. However, they still have a very understandable structure. They do not have bodies like candlestick charts, you can learn whether the price is falling or rising from the short lines drawn on the right and left sides of the bars. The line on the left of the bar chart gives the opening price of the pair, and the line on the right gives the closing price. The positioning of these lines at the bottom or the top indicates a decrease or increase in price.
SEE ALSO; What Do Forex Spread Indicate?Share this article