Episode 5 — Understanding Price Charts
Learn how to read the basic information contained in a share-price chart.
Welcome to Price Charts
A price chart is one of the most important tools used in technical analysis.
It shows how the market price has changed over time and helps you see trends, turning points and periods of strong or weak activity.
What Is a Price Chart?
A price chart is a visual record of how an asset's price has moved during a selected period.
Price Is the Main Character
The vertical part of a standard price chart represents price.
If a share moves from $10 to $15, the chart records that movement visually.
Time Runs Across the Bottom
The horizontal axis shows time.
Meet the Two Axes
Read the Price Move
Don't immediately search for patterns. First ask a simple question:
Has it risen, fallen or moved sideways?
Line Charts
A line chart usually connects closing prices to create a simple view of price movement.
Best for: quickly seeing the overall direction of price.
OHLC Charts
OHLC stands for Open, High, Low and Close.
Candlestick Charts
Candlesticks provide the same basic OHLC information in a more visual format.
What Does One Candle Tell You?
Bullish & Bearish Movement
Don't Forget Volume
Volume shows how many shares or units were traded during a period.
Timeframes Change the Story
Start Looking for Direction
Once you understand the chart, look at the structure of price.
Higher highs and higher lows.
DowntrendLower highs and lower lows.
SidewaysPrice moves within a relatively defined range.
🇦🇺 Australian Market Example
Imagine you're looking at an ASX-listed company on a daily chart.
1. What is the current price?
2. What period does each candle represent?
3. Is price rising, falling or moving sideways?
4. Is volume increasing or decreasing?
🧠 Quick Check
1. What does the vertical axis normally represent?
2. What does OHLC mean?
3. What should you check before analysing a chart?
You now understand the basic language of price charts.
+100 XPA price chart is one of the most important tools in technical analysis. It turns thousands of individual price movements into a visual story that can be easier to understand.
In this lesson, you’ll learn how to read the basic parts of a price chart, including price, time, OHLC data, candlesticks, volume and different timeframes. You’ll also learn how to identify whether a share price is generally rising, falling or moving sideways.
For Australian investors and traders, these skills can be applied when studying ASX-listed shares, ETFs and market indices.
The goal isn’t to predict exactly what a share will do next. Instead, the aim is to understand what the chart is showing and build a foundation for more advanced technical analysis.
Key Learning Outcomes
By the end of this lesson, you should be able to:
- Understand what a price chart represents
- Identify the price and time axes
- Understand line charts
- Explain OHLC data
- Understand the basic structure of candlesticks
- Understand trading volume
- Compare different chart timeframes
- Recognise basic uptrends, downtrends and sideways movement
- Start reading an ASX price chart with greater confidence