Module 2   Technical Analysis (Video Series)Chapter 3

Chart Types

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3.1 – Types of Charts

If not for a good charting technique, charts can get quite complex. Each trading day has four data points,  i.e. the Open, High, Low, and Closing called the ‘OHLC’. Looking at a 10-day chart, we need to visualize 40 data points (1-day x 4 data points per day). So you can imagine how complex it would be to visualize six months or a year’s data.

The key is to use an effective charting technique that will help us effectively analyze the OHLC. Let us learn more in this video.

 

In the following video, we will learn about the charting timeframes.

We recommend reading this chapter on Varsity to learn more and understand the concepts in-depth.


Key takeaways from this chapter

  1. Conventional charts can’t be used for TA as we must plot 4 data points simultaneously.
  2. A line chart can be used to interpret trends only. 
  3. Bar charts are unpopular as they’re unappealing, and patterns aren’t easily identifiable.  
  4. Candlesticks Types – Bullish & Bearish. The structure of the candlestick, however, is unchanged.
  5. Close > open = Bullish candle. Close < open =  Bearish candle.
  6. Time frames are crucial in defining trading success. 
  7. The number of candles grows as the frequency rises.
  8. Traders should discard noise from relevant information.

19 comments

  1. Manjunath C says:

    Very good video and explained well

  2. Vikash says:

    This is what I was looking for. Thanks Zerodha

  3. Shijith says:

    Really helpful and wonderful job.

  4. Naman Gupta says:

    Brilliant place to develop your beginn er knowledge. Highly recommend for #BEGINNERS.

  5. Jayesh says:

    Hindi me video post karo sir please.

  6. Manohar says:

    Thank you sir

  7. Dev Manani says:

    What does the last point in takeaways ” Traders should discard noise from relevant information.” mean?

    • Karthik Rangappa says:

      For example, a 1-minute chart generates 1000s of candles, which may not have useful information. You can discard that and use 15 mins or maybe even end-of-day charts.

  8. Prashant Chaudhary says:

    So far Excellent, Excited to proceed..

  9. Prb says:

    Time frame konsa use karunga day trading k liya?

  10. Praveen says:

    happy learning. Thanks zerodha

  11. Tanish jain says:

    Hey there, I am Tanish here I want to ask you is that the video series you have give over here, what do u recommend either video or reading and why??

  12. Nikhil says:

    Sir, which platform will you recommend to see the charts or accordingly modify them to understand the patterns ?

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