Why Use Tick Charts In your trading?
In this comparison video between tick charts and time charts, we break down how they are formed. This allows you, as a trader, to understand when to use tick charts in your trading, and how they can give you an edge over some of the standard charting methods.
Key points about tick charts before the video starts:
- They are based on trades. They ARE NOT based on how many contracts are traded. This means that a trader who buys/sells 1 contract is treated the same as a trader who trades 100 contracts. This is important to know
- Common values are 233T, 466T, and 512T
- They can clean up after-hours trading to make your charts look cleaner. This is because they will form less bars when there is less trading happening.
Comparing Tick Charts and Time Charts because they are the most commonly used.
The truth is that time based charting is king. Most traders use this method for a number of reasons including it is the classic and most common style, traders who look for new methods are few and far between, and it is hard for some people to adopt a new trading method.
Traders should not fall into a rut. Breaking away from standard methods, like using tick charts, can be a great way to get started. We use this comparison to the most classic trading method when we analyze tick charts because starting from a common place, we can understand the advantages and disadvantages of each charting style.
Using tick charts does not have to be an exclusive method for your trading. You can add tick charts to your chart analysis instead of a classic 15 minute chart to give you an in depth view on the actual trades happening in the market. You combine the two charting styles for a wider market analysis, and this give you an edge in the market.
Check out the Video on Candlesticks For Beginners Here:
Candlesticks For Day Traders
Bruce Banks
Trader and Trainer specializing in Forex and Futures
Bruce Banks