More Forex Charts

A bar chart reflects price action using a vertical bar to connect the highest price to the lowest price during a certain period. The opening price is shown as a horizontal line on the left side of the bar and the closing price is shown as a horizontal line on the right side of the bar. Bar charts can be used for any period of time where prices are available. Traditionally an hourly chart is the most popular time interval for bar charts. Because there is wide availability of real time prices, it is also common to use smaller time interval such as 30 minutes, 15 minutes, 5 minutes or 1 minute.

Point and Figure charts are made up of a series of X's and O's that reflect price movements over a period of time. An increase in price is represented by and X and an O represents decline. In terms of box size, each stack contains a stack of either X's or O's, but rarely both. The scale of the chart can be changed by the specified box size which is a minimum representation of price movement. If a smaller box size is used, small time intervals are applied. If larger box sizes are used, bigger time intervals are applied.

In terms of reversal amounts a stack of X's represents an up trend and a stack of O's represent a down trend. A new stack forms when prices reverse. It is calculated by multiplying the box size by the reversal amount. For example, if box size is set at 3 and reversal amount at 5. A new stack will be formed when the price rise or fall 5 x 3 = 15 points.