Which chart type is showing you the most?
Charting platforms offer a dropdown of chart types, and most people never touch it. But the type you choose decides what information reaches your eyes — and each one deliberately throws something away.
The three you actually need
Line chart. Connects one price per period — almost always the close. It discards the open, the high and the low, keeping only the market's final verdict for each period. That sounds like a loss, and it is, but it removes intraperiod noise entirely. The smoothest, least distracting view of direction that exists.
Bar chart (OHLC bars). A vertical line from low to high, with a small tick on the left for the open and on the right for the close. It shows exactly the same four prices as a candle — just drawn thinner. Popular with people who watch dozens of instruments at once, because bars use less ink and less screen.
Candlestick chart. Same four prices as a bar, drawn with a filled body. The body makes the open-to-close distance instantly visible from across the room. That single design choice is why candles have taken over.
There are others — area, Heikin-Ashi, point-and-figure, Renko — that transform or smooth the data. They are legitimate tools with different trade-offs, but they show you a processed series, not the raw one, and that is a distinction worth keeping straight in your head from the start.
A worked comparison
Imagine one dramatic day on a stock trading around $200:
- Open $200, High $201, Low $184, Close $199.
On a line chart this day is a dot at $199, a single dollar below where it opened — a barely visible wobble. On a candle or bar chart it is a small body with a $15 spike hanging below it, immediately visible as the most violent day on the screen.
The two schematics below are the same twelve authored sessions, drawn both ways. The second one is not a simplification of the first; it is a different set of numbers, five of the six thrown away.
Both charts are honest. The line chart tells the truth about where the day ended; the candle tells the truth about where it went. If your question is "how has the market's verdict evolved over three years?", the line chart is arguably the better instrument. If your question is "what happened on 12 March?", the line chart cannot answer it at all.
Choosing on purpose
A workable habit, matching the Markets Foundations rule of question-first:
- Long histories and comparisons between instruments → line. Overlaying five candle charts is unreadable; overlaying five lines is not.
- Recent activity, period by period → candles.
- Many instruments on one screen → bars.
The failure mode is not picking the "wrong" type — it is not knowing which one you are looking at, and therefore not knowing what has been hidden from you.
In the data
A line chart is a chart of one number per session. The daily record holds six: open, high, low, close, the adjusted close and volume. Below is the same month of Apple as the candles in the exercise, drawn as a line; this course's line charts plot the adjusted close, and its candles plot the four traded prices.
Five of the six numbers are gone before you have read anything. A chart rarely says which number it plotted, so two charts of the same stock over the same dates can disagree and both be faithful to the data.
Try it now
- Find the session that differs between the two schematics above, and write down the question the line version cannot answer at all.
- Now the same instrument on real prices, drawn both ways: a month of candles, then the whole history as a line. Find one session in the candles whose drama the long line view flattens to nothing.
- Write one sentence naming which view fits the question you personally care about, and keep using it on purpose. Both charts were drawn from the same six numbers per session — the discarding happens in the drawing, never in the data.