A price chart plots price against time. A line chart connects closing prices only. A bar or candlestick chart shows four values for each period: the open, high, low and close. A candlestick fills the space between open and close as a body and draws thin wicks to the high and low, which makes the direction and strength of each period readable at a glance.
A price chart plots price against time. Every chart type shows the same underlying transactions — they differ only in how much of each period they keep.
Understanding what each one throws away is the difference between reading a chart and just looking at one.
Step 1: a chart is made of time slices
A chart does not show every individual trade. It groups them into equal slices of time, and draws one shape per slice.
On a 1-hour chart, each shape covers one hour of trading. On a daily chart, each shape covers a day. Choosing that slice size is Part 3; for now, just know that each shape on a chart is a summary of one time period.
Step 2: the four numbers in every period
Split any period and four prices define it. Remember these four and the rest of this course follows.
| Value | What it records |
|---|---|
| Open | First traded price of the period |
| High | Highest price reached |
| Low | Lowest price reached |
| Close | Last traded price of the period |
These four together are called OHLC.
The close matters most. It is the price participants were willing to end the period on — the settled opinion, rather than the argument that happened along the way.
Step 3: the three chart types
Line chart — connects one point per period, the close, and drops the rest. Simple and quiet. Useful when a chart looks messy and you want to see the shape of the move.
Bar chart (OHLC) — a vertical line from low to high, with a small tick on the left for the open and on the right for the close. All four values, plainly drawn.
Candlestick chart — the same four values, but the space between open and close is filled in as a body, with wicks reaching to the high and low.
Step 4: reading a candle’s shape
This is the skill that carries through the whole course. Two things to look at, in this order.
How long is the body? The body is the settled part — where the period began and ended. A long body means one side pushed price and held the gain into the close. A small body means the period finished close to where it started.
How long are the wicks? Wicks are the rejected part — prices reached and not held. A long lower wick means sellers pushed price down and buyers pushed it back before the close.
Key takeaway Body = what was settled. Wick = what was rejected. Those two words let you describe any candle on any chart, without memorising a single pattern name.
A note on colours
One colour marks periods that closed above their open, another marks periods that closed below. Green and red are the common pairing, but this is a platform setting, not a standard.
Check which way yours is configured before relying on it — and note that on a black-and-white printout, colour disappears while body and wick proportions remain readable. That is another reason to learn shape before colour.
Which to use, and when
- Candlesticks for almost everything — entries, structure, patterns
- Line when a chart looks noisy and you want the underlying shape
- Bar if you find candle colours visually loud on longer timeframes
On InnoMP, WebTrader offers 4+ chart types across 8 timeframes with 30 drawing tools, and MetaTrader 5 adds 46 graphical objects. Far more than anyone needs — the tool matters far less than reading the same instrument the same way every time, so what changes on screen is the market and not your settings.
Next: Choosing a timeframe — how much time each candle should cover, and what each choice hides.
- Every period on a chart has four values: open, high, low and close.
- A candle's body spans the open and close; its wicks span the high and low.
- A long body means one side controlled the period; a small body means neither did.
- Candle colours are a platform setting, not a standard — check which way yours is set.