About Tick Charts
What are tick chartsCharts used for day trading can be based on several different criteria, some of them being time, ticks, price range or volume.
Tick based charts represent price change during given number of transactions on the market. E.g.
while time-based charts draw a new bar after a set period of time, tick charts display a certain number of trades (ticks) before printing a new bar.
BenefitsUsing tick charts exclusively or in combination with the classic intraday time-based view could enrich your chart analysis and provide you with some additional information.
Tick Charts - A quick look at how they're used.
This helps to notice momentum and increasing volatility.
The same way during low activity periods (like noon or after-hours) tick charts only display a few bars as opposed to time based charts where you'll usually see a row of smaller less important candles. Without this accumulation of small candles tick charts make it easier to spot trends and properly identify real support and resistance levels.
This might be especially helpful for traders scalping.
DisadvantagesUnfortunately only some brokers/charting packages provide tick charts. As an addition looking at tick charts from different data feeds you will notice that none of them are the same.
The reason is that tick charts are based on the number of completed transactions, however this number can change because of some factors like:
70-tick chart at broker Alpari UK using RainWood's Tick Chart indicator70-tick chart at broker Pepperstone using RainWood's Tick Chart indicator70-tick chart at broker FXCM using RainWood's Tick Chart indicator70-tick chart at broker Dukascopy Europe using JForex platform (not MT4) provided by the broker
What tick chart time frame to chooseThe time frames to choose from are limitless.
Some prefer charts with 33, 133 or 233 ticks, others choose from fibonacci numbers like 13, 21, 34, 55, 89, 144, 233, etc.
E.g. if someone trades 5 minute charts, he may choose a tick chart looking similar to that chart in an average market activity period.
Then he would be able to see when the market volume changes during high or slow activity periods and trade accordingly.
1. Tick Charts allow you to follow the Professionals
How to trade using tick chartsJust as with any other chart types there are many trading strategies using tick charts.
One could prefer 2000-tick charts for day trading while another would use 70-tick charts for price action scalping.
What is a Tick Chart?
You need to look around on the internet, experiment and find (or develop your own) one that suits you the best.
Read more…If you would like to learn more about tick charts, check out the Links section.