Traders use charts to time entry and exit points. A chart will show the actual price history of a specific currency. By learning to recognize trends a trader can identify whether or not he is buying a currency that is in trending higher, moving lower, or trading in a sideways fashion. Learning to recognize chart patterns will help a trader recognize key shifts in the market's direction and profit from the expected move.
Most trading platforms provided from online currency brokers will include some sort of charting service. These charts can be manipulated for various timeframes. One can build an intraday chart to identify short term trends. Long term weekly charts can be built to get a picture of the long term price trend of a currency. Pattern recognition software has become available recently. With this type of software program your computer will "recognize" popular chart patterns. This is a tremendous advantage for the new currency trader. Learning to recognize chart patterns is a challenge that takes time and determination. If your trading platform doesn't come with a charting service there are several available on the Web. Basic charts--bar charts or candlestick charts--can be found for free at various financial websites. Free charts, however, will display only a limited amount of information. For more detailed charts you will need to subscribe to a charting service. With premium charts you will be able to build various moving averages or other technical indicators not found with free charts.
