Bar Charts

Written by Trader Maker

Bar charts are a step forward in the information they contain. As you can see it still indicates the overall trend but the bars have dashes and are different colours.

The top and bottom of the bar shows the highest and lowest price traded in that period. The dashes show the price that was first traded (open) in that period and the last price traded (close). These are important as they are one of the best points indicate where to get into trades.

Bar charts can be used as entry and exit points of trades. If as in this example the overall trend is down, then look for the top of a blue bar, or closing price to see where you may want to short (sell) the product you are trading. This will work in same way for and market or chart that is trending upwards.