Three important types of chart you must understand
Becoming a profitable trader is all about precision. You can succeed in life without devoting yourself to your work. Those who are looking to lead their dream life in Hong Kong with a currency trading business must have a strong foundation. Unfortunately, the rookies don’t have enough skills to read the chart. Many novice traders don’t know the three most important types of chart they need to know. In most cases, they use the Japanese candlestick chart and go with the traditional trading method. Though it can give you critical information about the market, you still need to learn about the top three types of charts used by the elite traders at Saxo. Let’s find more details about these charts.
The area chart is often known as the line chart. If the line is shaded with a light color then it becomes your area chart. If you are looking for some general information like the rate of change in the U.S dollar index for the past 5 years, the area chart might give you vital data. Instead of using a complicated chart, it is better to learn the area chart. In most case, popular websites represent the financial data in the form of an area chart when it comes to the evaluation of the historical price movement. Though you might get comfortable with this chart still you have to learn the other two major types of charts and its use.
Things become a little bit complicated as you move to the bar chart. For using the bar chart in real-life trading you need to find a great broker like Saxo. Visit their website to learn more about the different types of chart they offer in their free trading platform. You can also use their demo platform to develop your trading skills. Once you become good at analyzing the bar chart, you will be able to make some serious profit from this market. Things are not all as hard as they seem. With the help of the bar chart, you can learn about the open, low, high, and closing precise of the bar. The bars can viewed in a different time frame and you need to give priority to the higher time chart.
The candlestick chart
The Japanese candlestick chart is the most popular one and is hard to understand. However, if you follow some basic rules, you can get into the details in less than a month. Each candle tells you different stories about the market. Analyzing the story of the candle is almost like reading the price action signals. Some of you might have heard that the price action trading is the best way to make money. This statement is very true because you can analyze the raw price data with a high level of accuracy. Things might sound a bit complicated at the initial stage but once you learn to deal with the complicated market dynamics, you will be able to make some serious profit from this market. Follow the long term goals and try to take the trades with low risk.
Creating your trading model
After you have learned about the different types of chart patterns, it’s time to create a trading model. To create a trading model, you have to carefully asses the condition of the market. Once you become good at analyzing the price movement, you will become comfortable with the different type of chart. Trading should be done simply and that means you have to create a trading strategy with simple logic.
Based on your chart analysis process, you can curate a simple model. Try to analyze the trading asset in the candlestick chart and use the area chart when you take a look at the generic data. Never make things complicated with the hope of earning more money.