How To Read Stock Market Charts

1. The Volume Bar.
   Usually, there are two vertical lines in stock index charts. One will appear at the bottom and the other will be located a few notches above it. Most of the time, there is a line at the lowermost part of the chart that corresponds to the one above. The lower bar signifies the volume of the stocks at a given point.

2. The Low and High Value Indicator.
   The vertical bar on top of the volume bar indicates the low and high values. The top part of this short bar signifies the high value and the bottom part of the bar is the low value. Several bars maybe scattered across the chart so just look at what figure the bar corresponds to in order to determine the right numerical figure.
3. The Open and Close Marker.
   On some stock trading charts, the bars appear short and stout with a thin line inside it. The thin line is usually called wick, because the figure now looks like a candle, judging from its form. The thin line or the wick signifies the low and high values, as explained above. Now the fat line, which also looks like a short bar covering the thin line, indicates the open and close values. To differentiate the open from the close, the bar is shaded. If the bar is colored, then that means that the open is the value indicated by the top of the bar and the close is the bottom value. If on the other hand, the bar is hollow, it means that the close is higher than the open.

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There are different types of charts you will encounter in the stock market world. But these are the basics you have to know. Some charts are presented in a more understandable form like a bar graph or a line graph. But once you know what the figure signifies, interpreting the data becomes easier.

Just keep in mind that these stock market charts can only serve as guides in your investment activities. They are by no means an accurate indicator of what the future of stock market is going to be. But then again, they offer intensive information that could help you in your next course of action.

With these information, you will surely appreciate stock charts more. If you want to practice reading, get free stock charts over the Internet or directly from stock market dealers. If you became a master on reading these charts, you will be more guided in your everyday investment on the stock market!

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