Different Perspectives: A Look at Charting Techniques
by Richard Evans
A stock’s price at any point in time is the sum total of what all investors think about the stock. Whether an investor makes money or loses money depends on what others think about the stock, so keeping track of price, which is what technical analysis is all about, should be of interest to all investors.
There is, though, more than one way to plot a stock’s price, and these various plotting techniques afford different perspectives on a stock.
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To demonstrate the different patterns, I’ve decided to use Intel as an example, because the stock is well-known and has made some interesting patterns.
BAR charts
One of the first ways of plotting stock prices was line charts, based on closing prices. Among the first line charts were the closing prices of the Dow Jones industrial and rail indexes. In 1928, high and low prices were added, and the utilities average was started. And, as a note for history buffs, the charts covered six days a week, since trading on the New York Stock Exchange included Saturdays—not until June 1952 was trading cut back to five days a week.
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