How to read forex charts for beginners

Last Update Thursday 20 August 2026 14:20

What is a forex chart?

A forex chart is a graphical representation showing how the price of one currency has changed in relation to another over time. The price of the currency pair is plotted on the vertical y-axis, while the horizontal x-axis shows time. On our trading platforms, you can choose how frequently new data is plotted by selecting your preferred timeframe, ranging from tick-by-tick to a whole month.

How to read a forex chart

Understanding how to read a forex chart is essential to increasing your probability of success and limiting risk when trading currency pairs.

Take the GBP/USD currency pair as an example. The information you'll be able to read from the chart includes the currency pair (the asset name shows the 'base' currency, the pound, first, and the 'quote' currency, the dollar, second), the price (how many dollars you'd pay to buy one pound, shown on the y-axis), and the timeframe (the customisable chart period on the x-axis).

Pips on forex charts are also known as 'ticks' — they're the smallest possible change in the price movement of a currency pair. Pip stands for 'point in percentage' and refers to the minimum standard change in the quote currency. For example, if the price of GBP/USD moves from 1.34000 to 1.34010, the 0.0001 rise represents a single pip.

You can view the current performance of a currency pair's price, or select a certain period to see how it has changed over time, from ticks, seconds, minutes and hours to days, weeks and months.

Types of forex charts

The type of forex chart you choose depends on personal preference and the level of detail you want displayed. Some popular types include candlestick, Heikin-Ashi, HLOC, line and mountain.

Candlestick charts display pricing information in long, thin bars that resemble candles. Each candlestick shows price movement over the period you selected. For example, on a 15-minute timeframe, each candlestick shows how prices developed over a 15-minute period, the only exception being the candlestick on the far right, which shows live prices for the current, incomplete period. A green candlestick indicates the pair moved up in price over the period, closing higher than it opened. A red candlestick indicates the price decreased. Each candlestick shows four specific prices: open (the price at the start of the period), close (the price at the end), high (the highest price traded) and low (the lowest price traded). To learn more, see our guide on how to read candlestick charts.

Dojis occur when the opening and closing prices are equal or very close together, creating a cross. This indicates indecision in the market. Taken on its own, a doji is a neutral pattern, but if it forms within an uptrend or downtrend, it may indicate a reversal is on the way.

Heikin-Ashi is a type of candlestick chart. The Japanese term roughly translates to 'average pace' or 'average bar', and this chart depicts price averages as well as their changes over a period. A long green bar indicates a significant increase in average price, whereas a long red bar shows a sharp decrease. Heikin-Ashi charts are smoother than candlesticks as they show general trends rather than exact prices.

HLOC charts (also called bar charts), standing for 'high, low, open, close', show exactly the same data as a candlestick chart but in a different way. The open price is the notch to the left of the vertical line, the close price the notch to the right, the high price the uppermost point, and the low price the lowest point.

Line charts only show the close price for the time period selected, joined together to form a line. This is a very simple way to display pricing data. Many forex traders only use line charts when assessing long-term trends.

Mountain charts are the same as line charts, except the area beneath the line is shaded, giving the appearance of a mountain in silhouette. Like line charts, they're mainly used to assess long-term trends.

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What are forex indicators?

Forex indicators are overlays you can add to charts — they represent mathematical calculations that can help you identify market signals and trends. While indicators can be helpful as part of your technical analysis, they're just one way of strengthening your trading plan.

The moving average (MA), also known as simple moving average, determines the direction in which the current price trend is moving. It can also help identify the strength of a trend and possible reversals via support and resistance levels.

The relative strength index (RSI) shows the direction in which a market is likely to move. Represented as a figure from 0 to 100, support and resistance levels are set at 30 and 70. An asset with an RSI around 30 is considered oversold, while one around 70 is considered overbought.

The slow stochastic, like the RSI, is an oscillator that can help you find oversold or overbought environments by tracking momentum and trend strength. A figure below 20 often represents an oversold market, while 80 and above is considered overbought.

Moving average convergence divergence (MACD) compares two moving averages to detect fluctuations in momentum. Convergence means the moving averages are moving towards one another and momentum is decreasing, while divergence means they're moving apart and momentum is increasing.

What is technical analysis?

Technical analysis involves studying historical chart patterns and formations to predict the future direction of a market's price — for example, looking at the relationship between consecutive candlesticks or HLOC bars. While this guide has introduced the basic concepts you need to read forex charts, many experienced traders use more advanced technical analysis to forecast price movements. Learn more in our guide on technical vs fundamental analysis.

How to access forex charts

You can access forex charts for free on our platform. You can use your live account to access charts and take a position, or view charts and practise on our demo account for free, without using any real capital.

To open a live account: fill in a simple form (we'll ask about your trading knowledge to ensure you get the best experience), get verification, then fund your account and start trading.

Ready to start reading the markets? Open a demo account to practise with charts and £10,000 in virtual funds, or open a live account to trade over 80 currency pairs. For more, see our guides on how to trade forex and technical analysis.