• New York : 07:22 PM
    • London : 12:22 AM
    • Tokyo : 09:22 AM
    • Sydney : 11:22 AM
    • Beijing : 08:22 AM
A currency pair takes on several directions; to analyze the directions traders develop different methods: fundamental analysis reads news sources such as DailyFX.com to see how fundamental indicators such as interest rates, inflation, employment and more affect the exchange rates’ movement. Another method is technical analysis which analyzes charts and data with different tools. Whatever method you use, you need to learn how to read a chart.

To pen a price chart, click on the ‘create marketshot’ button at the top of the trading station. Then, choose a currency pair, select the period and the data range.
Opening a price chart Screenshot
The period is the time interval that the chart updates. For example, a period set to one day (d1) means that each point on the chart represents one trading day of data. A period set to five minutes (m5) means that each point on the chart represents five minutes of data. The data range is the amount of data you want the chart to populate. If you want to look at a full year of data, you’d set the data range to one year.

Candlestick Charts Sample
The default chart type is called a ‘candlestick’ chart. It is the most frequently used type of charts in the fx market. A bar on a candlestick chart shows the open, close, high and low prices for the chosen period. The body of the candle shows the open and close prices where the wicks show the high and low prices.
If the closing price is higher than the opening price of the previous candle, then the candlestick will be blue. If instead the closing price is lower than the opening price of the previous candle, then the candlestick will be red. Candlesticks simply make it easier to see if the trading period ended up or down.

Many traders use technical indicators in a addition to reading charts to make their trading decisions. That way they make more informed trading decisions in the forex market. The indicators allow a trader to establish price trends and forecast future price movements. The trading station is equipped with more than 30 indicators that are already built-in. Also, there are more than 600 custom indicators that can be downloaded online. To add indicators to a chart just right click on the specific chart and select ‘add indicator.’

There are 3 ways that prices can trend: up (refers to a bull market), down (refers to a bear market) or sideways (refers to a range bound market). A trend line is drawn to help a trader distinguish which trend direction is in place. Once the trend is “broken,” a trader can rationally anticipate the trend to continue. To draw a trend line, you need to draw it with the ‘pencil’ tool. Usually, when you draw a trend line, you want to connect two or more extreme high or low prices that define the trend.