Line vs bar vs candle (and why candles dominate)

Three ways to draw a price

A chart is just a way to draw what price did over time. There are three common styles, and you should know all of them before you settle on one. A line chart connects the closing price of each period with a single line. It looks clean. It's also the most simplified — it hides everything that happened inside the period.

A bar chart, sometimes called an OHLC bar, shows four pieces of information per period: the open, the high, the low, and the close. The high and low are the top and bottom of the vertical line. The open is a tick on the left. The close is a tick on the right. Same data as a candle, just rendered with ticks instead of a body.

A candlestick chart shows the exact same OHLC data, but it draws the space between the open and close as a filled rectangle, called the body. The thin lines poking out the top and bottom are wicks (also called shadows). If the close is higher than the open, the body is green (or hollow on some platforms). If the close is lower than the open, it's red. Color does the work your eyes had to do on bar charts.

Why do candles dominate? Speed of reading. When you're scanning fifty bars, you don't want to squint at left and right ticks to figure out direction. A green or red body tells you in a glance. That's why almost every charting platform — TradingView included — opens to candles by default. We'll stay on candles for the rest of this curriculum.

Recap: line shows only closes, bar and candle both show OHLC, candles win because the colored body lets you read direction at a glance.