Types of Charts

Line chart

A line chart is a graphical representation of an asset's historical price action that connects a series of data points with a continuous line. This is the most basic type of chart used in finance and typically only depicts the closing price of a security over time. Line charts can be used on any timeframe, but most often using day-to-day price changes.

A line chart gives traders a clear visualization of where the price of a security has traveled over a given time period. Because line charts only show closing prices, they reduce noise from less critical times in the trading day, such as the open, high, and low. Since closing prices are typically considered the most important, it is understandable to see why line charts are still popular with investors and traders.

Bar chart/OHLC chart

Bar charts show multiple price bars over time. Each bar shows how the price moved over a specified period of time. A daily bar chart shows a price bar for each day. Each bar typically shows the open, high, low, and close prices for that period. This may be adjusted to only show the high, low, and close.

Candlestick

A candlestick is a type of price chart that displays the high, low, open, and closing prices of a security for a specific period. It originates from Japanese rice merchants and traders to track market prices and daily momentum hundreds of years before becoming popularized in the United States.