Stock Market Charts [3 Different Types]

The ultimate goal of the HowToTrade Academy is to provide traders and investors with an arsenal of weapons they can use to battle the stock market.

And this level is no different.

In fact, by the end of this level you will have added yet another weapon to your collection.

And I dare to say, it is one of the most important ones when it comes to technical analysis.

This level is all about stock market charts – what they are, how to use them to trade, how to spot patterns, opportunities, trends and other useful techniques that could potentially make you money in the future.

And that brings me to the next question.

What Are Stock Market Charts?

Stock market charts – the gateway to technical analysis.

Charts or more specifically, price charts, are a visual representation of stock movements over a period of time, whether it is last week, last night or last year.

Stock market charts are extremely important to investors and active traders, as they reveal historical data and how certain stocks have performed over a set period of time (whether it is 1 hour, 4 hours, a day, a week, or a month) which are extremely important for traders.

There would be no technical analysis without charts. It doesn’t matter what type of trader you are or what your preferred trading method is, everyone who is serious about becoming a trader has to learn how to read stock charts – there really is no escaping it.

So what does a stock price chart looks like? Let’s take a look.

Now, it may seem like there’s so much going on and it is going to be a real pickle trying to understand them, but they’re really not that bad at all.

Really, ask other traders!

You’ll get used to trading with price charts in no time.

It’s like riding a bike. It gets easier in time.

Now, what you see above is what we call a candlestick chart. It got its name because it is made out of small candlesticks.

We will learn more about trading with (Japanese) candlesticks in the next lesson. All you need to know for now is that they are the most widely used type of charts amongst stock traders.

The other two popular types of charts used for trading that we will further explore in the next chapters are bar charts and line charts.

They’re all completely different when it comes to their looks, but at the same time, they are the same in their core.

They help traders understand what is the central point and what is going on by providing them with a clear overview of the stock market in a quick way.

So Why Do We Need Stock Charts for Trading?

To put it simply, they are the key to making it in the stocks market.

Without price charts, one wouldn’t understand the price action, what is happening in the stock market and certainly wouldn’t be able to get any trade ideas or spot any trends or chart formations.

And that’s the whole point. To find trade ideas and spot big movements before they happen so that we can ride them out and take in the cash.

After all, what trader wouldn’t want to have a pool of cash to swim in?

I certainly would! And you?

What Happens Next?

In the next couple of lessons, we will teach you more about how to trade using technical analysis. We will take a look at the three most popular stock price charts used for technical analysis to monitor the stock market and how you can use them to your advantage when trading.

These three most popular charts used by technical analyst to trade are:

  • Line charts
  • Bar charts
  • Japanese Candlestick charts

Ready to learn more about trading with these charts?

Once you start trading, live charts (and other technical tools) will be a big part of your day-to-day life!

Let’s start off with Line Charts!