“A Candle Is Better Than a Bar Any Dayâ€
There are various ways that stock prices are
represented on charts. The most common charts are what are
known as:• line• bar• candlestick.Line charts are what you
typically see on the TV or in newspapers. They represent price
action by a single line.They only show the closing prices of
the stock and are of little use to traders. Because they don’t
show what has happened during the day.Bar charts represent
both the open and close prices. In addition, they include the
high and low of the day.
These four prices are critical for
your full analysis of a stock’s price action.Candlestick
charts show us all the price information of a bar chart but in
a far more graphical and clear way.The “story’ of the stock
literally jumps out at you.When we were first introduced to
trading it was with bar charts. But when we discovered
candlesticks a few years back we immediately saw the clarity
and detail that they provided.They may seem a little strange
to you at first but do persevere. We can assure you that they
are the only sort of chart to use!And candlestick patterns,
particularly reversal patterns are one of our favorite tools
in chart analysis. Doji, shooting stars and inverted hammers
may sound a bit weird at first but they are some of the best
friends a trader can ever have!So if you aren’t familiar with
candlestick charts and patterns I would strongly suggest that
you learn more, now.
And the VERY BEST explanation of
candlesticks [apart from the SMG Tutorials of course!] is
Louise Bedford’s “The Secret of Candlestick Chartingâ€. It is
on our booklist in: www.stockmarketgenie.com/
resources
David Chandlerwww.StockMarketGenie.com
Ordinary People Making Extraordinary Profits Our comments are
offered for educational purposes only. We are not providing
you with financial advice. We are simply sharing with you what
has and hasn`t worked for us personally. If you wish to trade
or invest in the stock market you should obtain advice from a
registered licensed advisor.
