Bars and Candles

OHLC Bars

Open, High, Low and Close

The OHLC Bars are used to show movement of the price over the time. Instead of analyzing each tick during the period of the time only four prices are taken into account:

• Open Price. Depending on the trading system rules the open price of the bar can be either the price on the market when the period of the time was started or the price of the first tick during the period of the time. In the first case the Open price of the bar is equal to the close price of the previous bar.

• Close Price. The last price occurred during the period of the time.

• High Price. The maximum price occurred during the period of the time.

• Low Price. The minimum price occurred during the period of the time.

Time frame

Time frame is the length of the time period used to collect the prices into the bar. The trader must choose the period which satisfies trader's goals. The mostly used time frames are:

• 1 minute
• 5 minutes
• 15 minutes
• 30 minutes
• 1 hour
• 2 hours
• 4 hours
• 8 hours
• 12 hours
• 1 day
• 1 week
• 1 month

Volume

Sometimes additional information can be collected into a bar during the period of the time:

• The total Volume of market orders executed during the minute. The volume can also be collected separately for sell and buy orders.

• The number of ticks (Tick Volume) during the period.

See Also

Tick, Median Price, Typical Price, Weighted Price