If your intentions about stock trading are serious, the first thing you should know is how to read stock charts and what stock charts are worth your attention. That’s your key to identifying the price movement that leads to making an important decision – should you buy or sell? Trend analysis is an integral part of a decision-making process, and it can’t be done without historical charts. Therefore, it’s critical that you get things going in the right interpretation of the given information to excel at technical analysis.
What are Stock Charts?
All investors need to have specialized tools for an in-depth analysis to make rational decisions. The volume of information you need to pay attention to is growing rapidly, so a well-structured chart makes it possible to react to the changing conditions faster. In simple terms, stock charts represent a graphical way to demonstrate the market data that includes volume and price changes based on time. Here are the angles you need to get a better understanding of while dealing with stock charts:
- Chart period. Timeframe plays an important role in trading stocks. If we talk about traders, they tend to pay more attention to data provided on the daily charts to predict short-term price movements. The second group of market players is investors who focus on weekly or monthly timeframes for widening their perspective for long-term investing opportunities.
- Ticker symbol (stock symbol). It contains 1-5 letters and is assigned to a company for conducting trading operations.
- Price change. The last change of the price shows the positive or negative net change compared to the closing price of the previous day. Let’s say a trader can seamlessly define how large the increase or decrease in the price of a certain stock was. For example, a stock had +$0,67 (+1,7%) – the percentage ratio depends on the stock price.
- Volume. It stands for the number of shares that were sold or bought during a defined period of time. Low market volume signifies that there aren’t so many investors participating in the current price movement. High volume, on the other hand, boosts your chances to buy or sell shares with profit; in other words, there are a lot of market participants ready to invest. An important thing to consider here is to be able to define the change of the trend: if it has been established for some time and you noticed a spike in the volume, there is a high potential for the trend to change.
The volume of information you need to pay attention to is growing rapidly, so a well-structured chart makes it possible to react to the changing conditions faster.
Best Stock Charts
How to find the best free stock market software out of dozens available? Finding free, and, more importantly, good, stock charts isn’t problematic at all. Let’s have a closer look at the top three stock charts that will propel your achievements to the next level.
Tradingview takes the first place in our list. It provides 15 million investors and traders with accessible charts and tools for in-depth analysis. Its free version allows the use of 3 indicators simultaneously. A trader/investor can also consider using indicators that were created by other members of the platform – yes, that’s where you’re surrounded by the support of others in case of being a bit lost.
You want to add notes to your chart? Not a problem. You need additional lines for understanding the price direction? Sure thing. It’s flexible to your preferences and needs; just define them and then test to choose the best one. Prioritizing traders’ productivity, with Tradingview, it’s possible to view multiple charts at once, so traders/investors spend less time jumping from one chart to another and get a broader picture of the market direction.
Main features:
- Social network;
- A wide variety of charts;
- Custom indicators and scripts;
- Partner with multiple brokers;
- Desktop and mobile versions;
- Trading alerts;
- Real-time data;
- Personalized technical analysis.
FinViz is all about remaining useful for a long time. If it's a trader's first time using FinViz (short for Financial Visualizations), there is no need to register. A free version of this stock charting software provides access to the important tools and features. It also provides useful information such as quotes and real-time news. With the possibility of using a stock screener, users can seamlessly sift data through a number of fundamental and technical metrics. In addition to the stock screener, there is a heat map available to group S&P 500 stocks by sectors.
Its interactive charts enable investors to use a crosshair cursor to analyze relative strength indicators of a stock or spot exact data points.
Main features:
- Forex and futures data is available;
- Groundbreaking visualizations;
- Notifications and alerts;
- Screening with a highly visual approach;
- Backtesting.
How about finding new opportunities to boost your portfolio management? It’s real with StockСharts. There are many investors and traders around the world who find this technical analysis platform helpful for generating high-quality financial charts in just a matter of seconds. Traders and investors can create bigger and advanced charts with the possibility of saving them to their accounts. To spot a new investment opportunity, users can operate with custom scans and adjust automatic alerts based on their personal technical criteria.
It’s easy to stay on top of things here, as investors can follow industry leaders and analyze the charts they consider worth paying attention to.
Main features:
- Highly interactive;
- Real-time charting;
- Leading technical scanning;
- Expert commentary;
- User-friendly user’s dashboard;
- Custom alerts.
Types of Stock Charts
There are three basic types of stock charts:
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A line chart is considered to be the most basic one among others. It aims to specify trends in the price movements – traders can view the closing prices of the stock by choosing the time period they need for analysis. The negative side here is that it won’t provide data on intraday price changes since only closing prices are displayed. The closing prices are marked as dots which, in their turn, are connected with lines for comprehensible visual representation.
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Compared to a line chart, a bar chart provides you with more information. Traders can view bars that provide prices with high, low, close, and open data during a trading day. This chart defines the level of volatility as well – longer lines mean higher volatility.
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The most popular chart for technical analysis is a candlestick chart. The price movements are provided through candlesticks in a precise manner. This chart allows traders to examine volatility information for a longer period of time. They’re also marked in specified colors to enable instant сoncentration on positive and negative candles.
Final Words
A stock chart is a powerful tool that has gained popularity among traders and investors around the world. Finding something that perfectly matches your criteria would be challenging without this "helping hand" – numerous filters and metrics are available for users to stay on track anytime, anywhere. Try and define which real-time stock charts meet your expectations.
About JustMarkets
JustMarkets is an international broker with clients from 197 countries. Millions of people have already opened trading accounts on JustMarkets to benefit from the best conditions, including low spreads, commission-free withdrawals, and a helpful team of support, working round the clock to ensure that each of our clients has the most convenient trading experience.
Open a demo account on JustMarkets to try your hand at currency trading. It’s a risk-free way to learn to trade in the most liquid financial market. A teaching account will help you learn trading basics and develop your own strategy before you invest any money. Learn trading today to take care of your future tomorrow.
by , 2021.05.25