Technical Analysis
The Point and Figure Chart
This type of chart is
somewhat rare, in fact most charting services do not even
offer the point and figure chart. This is a chart that plots
day-to-day increases and declines in price. Increases are
represented by a rising stack of X's while decreases are represented
by a declining stack of O's. These types of charts were traditionally
used for intraday charting (a stock chart for just one day),
mainly because it can be long and tedious to create P&F
charts over a longer period of time manually.
The idea behind P&F charts is that they help you to filter
out less-significant price movements and let you focus more
on the most important trends. Below is an example of a Point
and Figure chart for AT&T (T):
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| This chart
was supplied by Barchart.com |
Now that we've taken a look at three different types of charts
used by technical analysts, let's take a tour of various indicators.
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