Problem with using chart

Hello Babypips I’m having a problem here why we using a chart when we trade and why we use it?

Hello Chris! :smiley: Welcome to BP! :blush: Maybe you could tell us more about the problem? :slight_smile: Like, why do we use charts in general? Or are you referring to a paticular chart pattern or something? :slight_smile: Haha.

I mean like why do we use charts general and how do we use it cause this thing it’s very confusing?

I see no problem on the charts. I see opportunities.

The idea is that the charts show how much the big players like international banks want to buy or sell the currencies in the pair. If they want to buy EUR they will offer higher and higher levels of other currencies in order to get their required quantity of Euros. For example if they are offering GBP in exchange for EUR, this makes the EUR/GBP exchange rate go up.

This is useful for us because we can see from the movement of price on the chart that EUR are being bought and we might think we would like to be part of this movement as long as it continues, so we can take a buy position or a long position on the EUR/GBP pair. Or we might see signs that the rate is not rising so fast and is maybe going to fall and we might decide we want to ride the downward move, so we can take a sell position or a short position on EUR/GBP.

Either way, the chart gives information about recent price movements from which you can decide which next movement you want to be part of.

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