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Forex Charts and Historical Prices

Forex currency pair price charts are used to analyze the current trend of the market. The charts also provide those who are able to read the forex trading charts with special clues and insights for the future movements. Forex charts are easy to understand, as they provide a visual representation of price movements. These charts deliver both the current price movements and the historical prices that help experienced traders to identify signals for future price movements. There are different types of forex currency pair price charts that are available in MT4 and MT5, including:
  • Line Charts
  • Bar Charts
  • Candlestick Charts
Of the charts mentioned above, the traders use candlestick charts most widely, in order to analyze forex price movements of a currency pair. The reason is that the candlestick chart provides a user-friendly representation of the change in the prices of a currency pair. One candlestick represents the hourly, daily or monthly movement of the pair's prices, according to the user’s selection. The color of the candlestick reveals the bearish or bullish trend of the pair immediately i.e. green for bullish and red for bearish. The candlestick chart also gives the opening, highest, lowest and closing points of the currency pair.
The most popular currency pair in the Forex trading market is the EUR/USD pair. Even though the Euro only came into existence as a currency 21 years ago, when 19 European nations adopted a single currency as a medium of exchange, the EUR/USD has managed to lead other currencies in the matter of forex trading. This currency pair has appreciated since it came into existence, rising to an all-time chart high of 1.6037 during the Great Global Recession in July 2008. The second most important currency pair is the GBP/USD, which saw a massive decline to the lowest level in 7 years, at 1.40, during the Great Recession. On an all-time chart, the GBP/USD pair dropped to the lowest level ever during 2016, when Britain voted to leave the European Union.
Reading forex currency pair price charts gives a trader useful information about the forex signals and the current price fluctuations. To help readers to understand how to read forex currency pair charts, we will explain it by means of a candlestick chart, as this is the most widely used form.On a candlestick chart, two types of candles are formed: a buyer candle and a seller candle. The buyer candle represents a bullish trend of the forex currency pair. It has a green or white body. The seller candle, which represents a bearish trend, has a red or black body. Both candles also provide the opening, highest, lowest and closing levels for the currency pair.The forex chart analysis provides useful insights, such as how long the bearish or bullish trend will prevail in the market. If, after a red candle, the next candle gives a new lowest level, it means that the selling trend in the market will keep going. It provides short position forex signals, and traders will take new positions or hold their short positions. If the next candle gives a new highest level after a buy candle, traders will take new buying positions or hold their long positions, in order to earn more, as this signals a long position. Traders might encounter different historical price charts, in the form of line charts, bar charts or OHLC bar charts.