The candle chart is one of the most popular types of construction price quotations used for trading on financial markets around the world.
This display option of quotations shows us a candle stick and the shadows which makes it visually accessible to estimate the amplitude of price movements during a certain time period and the opening and closing rates of the specified temporary period.
Unfortunately, a small number of brokerage firms in their terminal, to trade binary options, privides their clients with the candlestick quotes charts. In the overwhelming majority of cases such companies use line graphs in the terminals.
Candle graphics are often used in more professional trade terminals, such as MT4 and MT5, and in some types of Web terminals.
What does the Candlestick Chart give us?
With the help of a candle in the charts, as it has been said above, the trader sees perfectly well the amplitude of fluctuations in the value of the investment within a certain period of time, and determines the volatility (mobility) of a financial asset, as well as the graphic shapes of the quotations used in the trade on patterns, as well as in other kinds of Price Action (trade without the indicators).
Building a Candlestick Chart
The candles on the chart are constructed in the following way. For example, our chart of quotations has the timeframe H1. In this case, a new candle is opened every new hour. The price level that the candle has, is the opening price (it is displayed in the terminals as Open), the level at which it is closed - is the closing price (in the terminal it is displayed as Close). The maximum levels of deviation from the opening price are High and Low candles.
Thus, the candle chart gives the trader all the necessary information on temporary price quotations of the financial asset for technical analysis and it is more informative compared to a line chart.