Types of Gold Charts
In xauusd trading there are three types of charts that traders can use to trade XAUUSD.
Charts are graph representations of the price movement that are drawn on a grid & they can be drawn using different chart timeframes like 1 minute trading charts, 5 minutes charts, 15 minutes trading charts, 1 hour, 4 hour, daily, weekly and monthly chart timeframes.
One will choose the chart timeframe to trade with depending on their style of for the day traders they'll select and choose the 15 minutes trading charts and scalpers will use the 1 minute charts, swing traders will use the hourly trading charts.
These trading charts can be drawn using different chart representations, these are:
- Line Charts
- Bar Charts
- Candles Charts
Line Charts
The line chart is one continuous line that is drawn to represent the closing price, if a trader is using the five minutes charts then the closing price for every 5 minutes is drawn and linked to the next close of the next 5 minutes thence this forms one continuous line that forms the line chart.
This chart type leaves out a lot of information about the gold price movement; this chart only draws the closing price & leaves out the high price, the low price and the opening price. Because of this the line chart isn't very popular among gold traders - xauusd traders instead prefer to use other chart types like the bar charts and candlesticks charts that include this info on their chart representations.
Bar Chart
Bar charts will plot all the info about price info - this information is known as O-H-C-L - Opening price, High of Price, Closing Price and Low of Price.
This info is represented in the format of a bar. The bar charts have 2 different colors; these are red for when prices move down & blue for when price moves up, the bar chart is displayed below.
These bar charts plot all the price info as is shown above. The vertical bar represents the overall total price movement, the left horizontal bar shows the opening price & the right horizontal bar shows the closing price, the highest & lowest points represent the high of price and low of the price respectively.
These charts are not very visually appealing when drawn close together just as shown below and for this explanation these bar charts aren't commonly used when trading gold.
Candle Charts
These are the most commonly used types of charts - these chart show all the info of price - OHCL in an easy to interpret and analyze format.The candle charts are of two different colour, red for when price moves down and blue for when price heads upward.
These candlesticks charts look like candlesticks with wicks on both sides. The body of the candle illustrates difference between opening price and closing price. The high and low that are represented by what's known as the shadow this is the part that looks like candle wicks represents the highest price & lowest price.
An illustration of how xauusd charts look is displayed below:
This is the most commonly used chart when it comes to gold.
To select between any of these chart types on the trading platform a trader can use the buttons shown below.
A trader can switch between various different chart types using the above platform buttons when trading the xauusd market.
More Topics and Courses:
- RSI Overbought and Oversold XAUUSD Levels
- How to Set a Pending XAUUSD Order on MT5 Platform
- Drawing Downward Trend Lines & Channels in XAUUSD Charts
- Methods of Scalping XAUUSD, Day Gold, Swing Trade Gold and Position XAU/USD
- Meaning of Fib Extension Levels in MT4 XAU/USD Trade Platform
- List of Beginner XAU/USD Strategies for XAU/USD Beginners
- How Can You Trade Inverse Head and Shoulders XAU/USD?
