Forex Charts in Review and Helpful Interpretation Tips
October 25th, 2007 | 
Author: When learning how to read and interpret the foreign exchange market chart, it is important to remember that there are two basic approaches to the forex market. The first approach is fundamental analysis, which does not rely heavily on the use of charts. This method uses political and economic factors to influence trades. The second approach is technical analysis, which relies more heavily on the use of charts to analyze the relationship between price and time. The technical approach uses charts to predict where prices are going by studying the historical pricing activity.
It is important o learn how to interpret forex charts in order to make strategic trading decisions. Most charts will have Currency A displayed on the left hand of the chart, while currency B is displayed on the right. The time is displayed horizontally along the bottom of the forex chart, and the price will be exhibited vertically along the right side of the chart.
 The currencies are then expressed in relationship to each other, meaning it will provide how much of the currency on the right side is required to purchase the currency on the left side. The last price displayed for that date will always be highlighted.
Forex charts are usually available online by joining a service. Charts remain very current and can be checked constantly. The relationship between price and time can be demonstrated using lines, points, or bars. Another popular way is the Japanese candlestick method. This method has a red section representing a candlestick. Lines protrude from the top and bottom of the candle stick representing wicks. The length of the wicks and body of the candle stick is determined by price. Longer candle stick have had greater price movement, the top of the wick displays the highest price range. There are many charts to select from. Here is a review of some of the more popular forex charts.
Prophet.net charts have 30 different indicators and a platform that can be customized. It utilizes data streaming to analyze trades quickly and accurately. FXtrek is very popular amongst beginners. It features both tick and on minute time frames and displays the most commonly used indicators.
Stratagem is very user friendly. The forex chart has a menu bar that allows you to execute the most common charting activities quickly. It allows you to remain organized while analyzing 14 technical indicators, 7 different time frames, and multiple ways to view the chart information.
The Chartstation is a more advanced foreign exchange chart. It has 21 technical indicators, 13 time frames, and innovative methods to save your data. The Prosticks charts offer 15 popular indicators and 11 time frames.
The ProReal Time charts are easy to use for even the most complex activities The Metatrader charts are unique because it has built in language for programming custom indicators and trading strategies.
It is important to remember that no matter which chart you choose, it should only be used as a tool, you should not ignore other obvious market signs. Charts can be a great way to analyze historical trends but you should also pay attention to political, cultural, and economic factors. Economic factors that can be especially significant include gross domestic product, budget and trade deficits or surpluses, inflation, and the interest rate.
You can also use forex charts to determine if a particular current event has historically had an effect on foreign currency. Using a chart to review trends in the past can help trader make successful decisions today. However, knowing how to read and interpret forex charts is not enough you should be able to analyze all relevant factors when developing a strategy and executing trades.
Posted in Forex
google forex ebooks and you can get a lot of great free resources!
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http://www.forexhandel.info
this is a great entry beginner report for those looking to get into forex. A lot of people get the misconception that forex is somehow easier than the stock market. The seem to think it is full of free money, and that is simply not the case. Learn you craft, hone it, and you can make a solid income on the forex, but you can bet you are going to loose some before you start winning.
a really great resource that helped me get profitable on the forex was the forexfactory. Google it. It is a great forum that has endless posts and studies to get your education into full gear.
are you forex trader?
I would only trade forex after developing a system that you are comfortable with and only paper trading at first.
This is an excellent overview of the basics of the forex market. Yes, forex is much riskier than stocks, but the reward is also much greater. For a trader who takes the time to learn and understand the fundamentals, the foreign exchange opens up a whole new world of investment possibilities.
You are right in saying forex is risky business and it is important that you pay attention to external factors. However if you are serious about trading you should primarily rely on technical analysis and pay some attention to fundamentals just to make sure that you are staying away from trading when the market is highly volatile.
Chart is an invaluable tool for decision making, I use it a lot, however just like the writer said, you should be able to analyze all relevant factors when developing a strategy and executing trades, in my opinion I thik That’s what matters
Great information. Nice post. Thanks for helpful to me.
Don’t I need to learn technical analysis to get a better understanding of charts and how to use them to trade forex?
IMHO MT4 is the most rich and popular charting platform thanks to the open source community and user contributions available by the platform development environment! search Google for Metatrader 4.
Very good information I haven’t seen anywhere else, but one question….How current is chart data? If it’s outdated…even a few hours…it might be very misleading. Bad data is worse than none at all.
Since Forex is the largest financial market in the world (by far) it gets a great deal of attention. As with many other types of investing, many people make some money in Forex and some make a lot of money. However, many lose money as well. The key to success is to learn and keep learning and to practice in a free demo account until you feel confident enough to try it with real money.
Stratagem is very user friendly. The forex chart has a menu bar that allows you to execute the most common charting activities quickly – thx for the info
A well written and detail information. There are a lot of new traders who are pretty confused about the chart and you have indeed simplified the process for them.
Thank for the great recommendation of those trading platforms.
Nice Info…
and thanks for that
Good post on the various charting tools available. There are a lot out there now and traders need to ensure that the charting they choose is compatible with their system. Really like this blog, would love to see more posts about forex. Thanks.
“FOREX” is also known as “foreign exchange trading” or “currency trading”. By buying and selling currency actively, you can make tons of money fast.
However, the most important thing is to find out which FOREX Guide programs you should spend time with, and which ones to avoid. On this page we have reviewed the Top 5 FOREX Guide Programs that are proven to work.
Anyone who is interested to start a successful forex trading have to become familiar with forex charts!
i found this blog from google, its very education blog for me. I have enjoyed reading. Nice blog .
Does someone have some recommendation about a good Forex trading platform?
Michael