Stock Bar Charts for Technical Analysis
Stock bar charts are an expended variation of the typical line chart. This chart is much more detailed as it uses additional pieces of information to correlate the data. Rather than using a single line like a line chart, stock bar charts feature a number of vertical lines that represent the highs and lows for the trading period, along with the closing prices.
Standard stock bar charts adhere to the following principles:
• The close and open are represented on the vertical line by a horizontal dash.
• The opening price on a bar chart is illustrated by the dash that is located on the left side of the vertical bar.
• The close is represented by the dash on the right.
• Usually, if the left dash (open) is lower than the right dash (close) then the bar will be shaded black, representing an up period for the stock, showing that it has gained value.
• A bar that is colored red demonstrates that the stock has gone down in value for that time period. When this occurs, the dash on the right (close) is lower than the dash on the left (open).
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