8 Important Types of Stock Chart + Pro’s & Cons

Choose The Right Stock Chart For Your Trading. Learn the Pros and Cons of Bar, Line, Candlestick, Market Profile, Point & Figure, OHLC & more.

There are 8 important types of stock charts used by professional analysts across the world.  The Line Chart is the simplest, depicting only the closing price.  The High Low Close Chart shows the price high low & close.  As we move to OHLC , Candlestick and Point & Figure Charts a new world of understanding supply and demand is unleashed. We explore the best 8 stock chart types and the benefits of each.

8 Types of Stock Chart

  1. Line Stock Chart
  2. High Low Close Bar Stock Chart (HLC)
  3. Open High Low Close Bar Stock Chart (OHLC)
  4. Japanese Candlestick Charts
  5. Volume at Price (VAP) Stock Chart
  6. EquiVolume Stock Charts
  7. Point and Figure (P&F) Charts
  8. Market Profile Stock Charts

Stock charts come in many shapes and sizes.  From the differences in the bars to the different concepts applied to the chart itself.  Here you will find a reference guide to the many types of chart available with an overview of their potential uses.

1. Line Stock Chart

Line Stock Chart
Line Stock Chart

This is one of the most basic charts, probably giving the least amount of information.  The line in the top pane is drawn using the close price for each unit of time.  So if this is a daily line chart, the close price for the day is used.  If this is a 5-minute chart, then the close price for every 5 minutes of trading is used.

The Positives of Line Stock Charts

A very simple view of the price movement.  Good to use when comparing the performance of many stocks on the same chart.

The Negatives of Line Stock Charts

Does not show the Price Open / High / Low for the trading period.  The trading range for the day is important in price based decision making as it indicates bullish or bearish momentum.

Stock Charting Services With Line Charts

  • TradingView – Our Number 1 Stock Charting & Analysis Package
  • Stock Rover – The Best For Value & Dividend Stock Screening
  • TC2000 – Best For US Trading & Stock Analysis
  • TrendSpider – Best For Automated Technical Analysis

2. High Low Close Bar Stock Chart (HLC)

High Low Close Bar (HLC) Chart
High Low Close Bar (HLC) Chart

Using bars is a step up from the line chart as is allows us to plot additional useful data on the chart.  Here we have each bar representing a trading period with the price High, Low and Close represented.  Refer to the diagram.

The Positives of High Low Close Bar Charts

More information is available, showing the range of the days trading, meaning did the stock price close near it’s high (bullish) or near it’s low (bearish).

The Negatives of High Low Close Bar Charts

No opening price is reflected in this chart.  The opening price is important as it allows us to immediately see if the price gapped up or down on open, and also where the closing price is in relation to the opening price.

Stock Charting Services With Line Charts

  • TradingView – Our Number 1 Stock Charting & Analysis Package
  • Stock Rover – The Best For Value & Dividend Stock Screening
  • TC2000 – Best For US Trading & Stock Analysis
  • TrendSpider – Best For Automated Technical Analysis
-

Watch our Stock Chart Types Comparison Video Walkthrough

Stock Charts – Review

Watch The Video Overview
-

3. Open High Low Close Bar Stock Chart (OHLC)

Open High Low Close Chart (OHLC)
Open High Low Close Chart (OHLC)

The complete bar chart.  The chart of choice for those who like to use bar charts.  Here we see the range of the day’s trading including the open price and the close price.

The Positives of Open High Low Close Bar Charts

We can see instantly if the trading period closed higher or lower than the open.  We can also see the length of the bar, which shows us the volatility or the strength of the trend.

The Negatives of Open High Low Close Bar Charts

There are few downsides to this chart type and it is used by many investors and traders.  Most chart packages also allow you to color the up days green and the down days red.  For those who prefer even more information in the price chart, the following charts can also be used.

Stock Charting Services With Line Charts

  • TradingView – Our Number 1 Stock Charting & Analysis Package
  • Stock Rover – The Best For Value & Dividend Stock Screening
  • TC2000 – Best For US Trading & Stock Analysis
  • TrendSpider – Best For Automated Technical Analysis

4. Japanese Candlestick Charts

Japanese Candlestick Chart
Japanese Candlestick Chart

 

Used widely in Japan and gaining a strong foothold in the rest of the world the Japanese Candlestick chart gives an excellent insight into current and future price movement. Named Candlesticks because they look like candlesticks with a wick and the main body.

The Positives of Japanese Candlestick Charts

Gives an excellent view of the Open, High, Low and close of the price.  Pictorially illuminating and easy to see trends.  There is a full reference below of 1 bar to 4 bar patterns which help us to make judgments on the future direction of price.  They connect psychology with the price pattern.

The Negatives of Japanese Candlestick Charts

Although Candlesticks have many advantages, they can seem like information overload to the beginner.  There are also many Candlestick patterns to learn.

Further Reading on Japanese Candlesticks.

Stock Charting Services With Candlesticks Charts

  • TradingView – Our Number 1 Stock Charting & Analysis Package
  • Stock Rover – The Best For Value & Dividend Stock Screening
  • TC2000 – Best For US Trading & Stock Analysis
  • TrendSpider – Best For Automated Technical Analysis
-

Stock Charts Using Volume

The use of volume in technical analysis is important as volume allows us an insight into the supply and demand situation.  The following charts incorporate volume into the price window to provide additional information.

5. Volume at Price (VAP) Stock Chart

Volume at Price (VAP) Chart
Volume at Price (VAP) Chart

The price at volume chart is an exciting new development, as instead of showing volume for a certain time period, it shows us the volume of trades at a specific price level.

This enables us to see at what price level most of the market participants believe the stock is fairly priced.

The Positives of the Volume at Price Chart

Innovative and intuitive, this method of charting combined with standard volume bars can enable you to see market psychology both in time and price.  It is also easy to see volume increasing as price rises, this is a very bullish sign.

The Negatives of the Volume at Price Chart

Not all stock charting packages offer this type of indicator

Stock Charting Services With Volume at Price Charts

  • TradingView – Our Number 1 Stock Charting & Analysis Package
  • TC2000 – Best For US Trading & Stock Analysis

6. EquiVolume Stock Charts

EquiVolume Stock Chart
EquiVolume Stock Chart

EquiVolume Charts attempt to provide the solution of Volume at Price in a different way.  Instead of plotting volume in separate bars, it is in fact incorporated into the price bars themselves.

The wider the price bar, the more shares were traded during that period.

The Positives of Equivolume Stock Charts

Visually impressive and extremely easy to interpret.

The Negatives of Equivolume Stock Charts

This type of chart can distort the timeline running across the bottom of the chart.  This makes drawing accurate trend lines more challenging.  Few Stock Charting service providers offer EquiVolume.  I would not recommend using EquVolume as a tool.

7. Point and Figure (P&F) Charts

Point & Figure Stock Chart (P&F)
Point & Figure Stock Chart (P&F)

There are a few other types of charts that you probably have never heard of before.  They are however quite useful and you would be required to learn them if you wanted to become a Certified Technical Analyst.

Point & Figure Charts are very unusual as they feature no timeline along the bottom horizontal axis.  The Chart is made up only of price swings.  The vertical price bar is arithmetic and shows only units of price.

A “0” is plotted if the price moves down a whole price unit (for example 50 cents).  Then when the price changes direction and starts to move upwards an “X” is marked in each box.  This filters out smaller price moves and enables us to focus on trend quality.

Trend lines are always plotted either horizontally or at 45-degree angles.

The Positives of Point & Figure Stock Charts

An excellent tool for doing price target calculations.  Simple to learn and interpret, few price patterns to learn.

The Negatives of Point & Figure Stock Charts

Learning this type of charting can be easiest when performing the charting by hand.  That means you marking the “X” and “O” on a piece of paper.  This can also be very time-consuming.  Few services offer Point and Figure Charts, however, StockCharts.com offer a free Point and Figure Charting Service that is well worth investigating.

Stock Charting Services With Line Charts

  • TradingView – Our Number 1 Stock Charting & Analysis Package

8. Market Profile Stock Charts

Market Profile Chart - Old School and Cool
Market Profile Chart – Old School and Cool

Developed in the 1980s by Chicago Board Of Trade Pitt Trader J. Peter Stiedlmayer.  The letters on the chart show time units.   “A” represents the first 30 minutes of trading, “B” represents the second 30 minutes of trading.

The point of control is the area (price range) at which the most trades occur during the day.

The value areas are the price range at which 70% of the action happens.  When the price is above and below the value areas this represents a possible ideal buying or selling point.

The Positives of Market Profile Stock Charts

People who use market profile chart become evangelists to the cause.  They believe it offers unique insights into buy and sell opportunities.  Can be a good option is you are a quick-fire day trader.

The Negatives of Market Profile Stock Charts

Can require quite an effort in order to learn how to use them, and very few stock chart services offer this type of charting.

Stock Charts Summary

Best Free Stock Charting Software Review
Right the Best Free Stock Charting Platforms

Some people refer to investing in the stock market as gambling.  I do not see it this way.  With the vast array of technical and fundamental data available you have a wealth of information at your fingertips.  Knowing how to use it is key.

As you can see there are many types of charts, the ones I would recommend are OHLC Bar, Candlestick Charts and Price at Volume Charts.

However, the choice is yours.

Top 10 Best Stock Market Trading Software Review
Read Our Top 10 Best Stock Market Trading Software Review

3 COMMENTS

  1. I have to say that for the past few of hours i have been hooked by the amazing articles on this blog. Keep up the good work.

  2. Market profile stock charts certainly must be a goto for day traders. Gotta spot activity during each time frame.

LEAVE A REPLY

Please enter your comment!
Please enter your name here