How to Read a Trading Chart — Understanding Price Charts

What a Chart Is Actually Showing You

A price chart is simply a picture of how a currency pair's price has moved over time. The horizontal axis (left to right) represents time, and the vertical axis (bottom to top) represents price.

Every point plotted on the chart records a trade or a group of trades that happened at a specific price and a specific moment. When you zoom out, you're seeing thousands of those moments compressed into a single visual pattern.

[Read the lesson: How to Read a Trading Chart](/learn-to-trade/understanding-price-charts/how-to-read-a-trading-chart)

Line Charts: The Simplest View

A line chart connects a series of closing prices with a single line. It's easy to read because it strips away the noise, but it hides a lot of useful detail about what happened between opens and closes.

Beginners often start here because it's uncluttered, but most active traders move on to charts that show more information per time period.

[Read the lesson: How to Read a Trading Chart](/learn-to-trade/understanding-price-charts/how-to-read-a-trading-chart)

Bar Charts and Candlestick Charts

A bar chart (sometimes called an OHLC chart) shows the Open, High, Low, and Close for each period using small tick marks on a vertical line.

A candlestick chart shows the same four data points — open, high, low, close — but displays them as a 'body' and 'wicks', which many traders find faster to interpret at a glance. We'll break down candlestick anatomy in detail in the next lesson.

[Read the lesson: How to Read a Trading Chart](/learn-to-trade/understanding-price-charts/how-to-read-a-trading-chart)

Reading the Time Axis

Each candle or bar represents a fixed chunk of time called a timeframe — for example, one hour, four hours, or one day. A chart set to the 1-hour timeframe will show one new candle every hour, no matter what the price does.

Understanding the timeframe you're looking at is essential: the exact same price swing can look dramatic on a 5-minute chart and barely noticeable on a weekly chart.

**Same Pair, Different Story:** Imagine EUR/USD moves from 1.0850 to 1.0900 within a single day. On a 5-minute chart, this might appear as a long series of jagged candles suggesting a strong rally. On a weekly chart, that same 50-pip move might be a tiny blip inside a much larger sideways range.

[Read the lesson: How to Read a Trading Chart](/learn-to-trade/understanding-price-charts/how-to-read-a-trading-chart)