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The Forex Graph: What’s the Difference?

forex graphThe Forex graph is an important part of the Forex market, and it is even more important to your Forex trading strategy. The Forex graph uses specific calculations to provide a technical analysis of past and present market activity. This information can then help you make predictions on what the market will do, which affects your buying and trading. There are a few different types of graphs, and you need to learn about each one. Click here to learn how to read Forex graph?

Line graphs

Line graphs are one type of Forex graph that you can use. For a Forex technical analysis, this type of graph shows how prices have changed over a certain period of time. You specify a specific time period and this Forex graph shows what the closing price of a currency was at the time. The line graph for a Forex technical analysis is one of the easiest types of Forex graph to read. This makes it much easier to apply the technical analysis information to a particular strategy that you may have or may be creating.

Price chart

The next type of Forex graph is the price chart. Price charts, as the name implies, deals with the currency prices. It is laid out like a line graph, but the technical analysis information is a bit different. This type of graph uses the prices of currencies at intervals of time, instead of the closing price for a time period. You have the flexibility of choosing the time intervals that you want to display, from seconds to years.

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A bar graph

A bar graph is another Forex graph that you can use. Bar graphs have much more information than the price charts and regular line graphs. The technical analysis information appears as bar measurements. The bars signify the price differences in the currencies in a specific amount of time. When a bar in longer it means there is more of a difference in the highest and lowest prices of the currencies for that period. This type of Forex graph is used to show you a visual representation of the price changes.

A candlestick graph

A candlestick graph is a more popular Forex graph. These graphs originated in Japan to keep track of the sales of rice harvests. They are used in the Forex market to keep track of pricing, similar to the other types of graphs. This type of graph, however, shows color coding. Candlestick shapes are used in the place of bars. When you have a green candlestick, it shows that there has been an increase in a currency price. A red candlestick shows there is a fall in the pricing. This color coding shows a technical analysis that is easy to understand at a glance. Other candlestick shapes are also used in this Forex graph. For example, you may find something along the lines of stars and gray clouds that are used to signify disparity or diffusion. Using these types of “pictures” lets you easily see what is going on with a particular currency during a specific period of time.

Learn how Forex charts work by going to http://currencydaytrading.org/how-forex-trading-charts-work/

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