Bar chart

Bar charts delivers more data per block of time, it features opening prices, closing prices, price highs and lows that shows real volatility of the movement. Line charts connect closing prices as shown on our first example, but real volatility of the market is hidden since it does not show price highs and lows. Transitioning from line to bar chart reveals that sometime between the month of May and June, the price of our stock ABC company experienced extreme price swings. This would entirely change our impression about the stock since volatility can be a powerful weapon for gains but riding that wave the opposite direction would be costly for losses.

A bar represents a block of time, it can be 15 minutes, hourly, 4 hours, daily or yearly.

Previous | Next

Stocks | Forex | Options | Economics | Bonds | History | Language learning | Technology | Technical Analysis | Fundamental Analysis
Copyright © 2014 econtrader | Risk disclosure | Terms of Use