TRADING CHARTS & TIMEFRAMES
TRADING & INVESTING TERMS
What is a Stock Chart?
A stock chart is a chart that depicts the price of a stock over a period of time. The price is scaled on the vertical axis and time over the horizontal axis. It provides different timeframes (e.g., 1 min, 5 min, 15 min, 30 min, 1 hour, 4 hours, 1 day etc.) that helps day traders and long-term traders to look at the trends. It also shows the company name of the stock and the stock exchange it is traded in.
What are timeframes in charts?
The timeframe of a chart is the time value of each candle in the chart. A chart can be drawn over different time frames, such as 1 day, 4 hours, 2 hours, 1 hour, 30 min, 15 min, 5 min, 1 min etc. The bigger the timeframe of a chart, the longer the timespan it represents. Normally traders start from a higher timeframe chart to find the trend and then dive deeper into a smaller time frame chart to find out specific demand and supply zones.
What is a Candlestick?
Candlesticks are the green and red bars on the charts. They show the price movements in markets. Some of them also have wicks showing the price trends for the timeframe a trader is looking at. With the support of Candlesticks, traders get to know if a market is bullish or bearish. They also help traders to predict the future markets. The green candle represents price closing higher than the price at the beginning of the timeframe. The red candle represents price closing lower than the price at the beginning of the timeframe. The wicks on both sides of the candle body represent the maximum price (both on the lower end and on the higher end) movement within the timeframe.
