What do the lines mean on a stock chart?

Trendlines, also known as bounding lines, are lines drawn on a stock chart that connect two or more price points. Since stock prices tend to trend, trendlines that connect the highs or lows in the stock’s price history can help identify the current trend and predict what the stock price might do in the future.

What does a horizontal trend line mean?

A horizontal channel is a trend line that connects the variable pivot highs and lows to highlight the price movements during a trading period. Otherwise known as a sideway trend or price range, horizontal lines are used by traders for identify breakouts to determine where price action is decisive.

What is the best type of chart pattern in determining price movements Why?

Triangles. Triangles are among the most popular chart patterns used in technical analysis since they occur frequently compared to other patterns. The three most common types of triangles are symmetrical triangles, ascending triangles, and descending triangles.

What are the lines at the bottom of a stock chart?

The vertical lines displayed at the bottom of the chart represent the number of shares traded during the specific time period of the chart. The length of the volume bar indicates a value that corresponds to the scale at its right.

What is line chart example?

A line graph, also known as a line chart, is a type of chart used to visualize the value of something over time. For example, a finance department may plot the change in the amount of cash the company has on hand over time. The line graph consists of a horizontal x-axis and a vertical y-axis.

What is the rule for a horizontal line?

A horizontal line is one the goes left-to-right, parallel to the x-axis of the coordinate plane. All points on the line will have the same y-coordinate. In the figure above, drag either point and note that the line is horizontal when they both have the same y-coordinate. A horizontal line has a slope of zero.

What is the horizontal line in a stock chart?

A horizontal line is a line drawn touching the support or resistance level on a price chart in technical analysis. Horizontal lines are commonly used to identify price breakouts and are deemed essential when analyzing trades.

What is BN pattern?

A double bottom pattern is a technical analysis charting pattern that describes a change in trend and a momentum reversal from prior leading price action. It describes the drop of a stock or index, a rebound, another drop to the same or similar level as the original drop, and finally another rebound.

What are vertical and horizontal lines?

Horizontal lines are lines that run directly from left to right and are parallel to the x-axis. Vertical lines are lines that run directly up and down and are parallel to the y-axis.

How do you read a chart?

Important things to know when learning how to read a stock chart

1. Identify the trend line. This is that blue line you see every time you hear about a stock – it’s either going up or down right?
2. Look for lines of support and resistance.
3. Know when dividends and stock splits occur.
4. Understand historic trading volumes.