eToro is one of the leading online trading platforms. One of the reasons it is successful is because of the tools which help traders. These tools are used to help analyse the behaviour of a particular asset or the market as a whole. A very commonly used tool is the price chart. This article provides more insights on how to find charts and read them.
(NOTE: Before we continue, we have to give a disclaimer that the trading products offered by the companies listed on this website carry a high level of risk and can result in the loss of all your funds. CFDs are complicated instruments that are never guaranteed to provide you supplemental earnings. In fact, Around 68% of all retail investors experienced a loss while trading CFDs. Make sure to keep this in mind before attempting to use the eToro platform yourself. All the information found on this website is not official trading advice and all practices shown are referenced for the use of the Demo account only.)
How to find charts on eToro
Navigate to the search bar and enter the name of the asset you want to understand, in this case, we use the stock Apple (AAPL). On the asset page, click on the chart icon. This opens the chart view.
The chart view generally opens with a candle chart. Clicking on the expand icon on the top right of the screen provides access to several chart types and operations.
Once in the expanded chart view, clicking on the chart type icon on the top right allows you to select one of the many chart types available on eToro – Candle, Hollow Candle, Bar, Line and Mountain.
Candle Chart (Hollow + Solid)
Candle charts are meant for slightly advanced users and consist of consecutive Japanese candles. Every candle has four distinct points – the opening, closing, high and low of the time window. The difference between a hollow and solid candle chart lies in the body – which can be hollow or colored. Bearish candles are red, while bullish candles are green.
Edges of the candle depict open and closing prices of the period. The thin lines on either end, called wicks or shadows, represent highs and lows. Each candle tells a story about the prevalent market conditions. This is the reason that the candle chart is a popular option trend following traders. Another plus is that candle charts also work well with a number of technical indicators.
Bar charts can be quite intimidating at first sight, but in essence, they’re quite straightforward to read. Like candles, each bar has four points. The opening price is represented by the foot facing left. The closing price is represented by the foot facing right. The high and low are extensions of the body, beyond the open and close.
Line the candle chart, each bar represents a specific interval of time. Bar charts are great for analysis – easy to picture and identify trends in the market. Key price points, such as, support and resistance levels are also quite easy to identify. In addition, bar charts are used with numerous technical indicators to get a better view of the prevalent market conditions.
Line / Mountain Chart
Line charts are the most basic chart type. When the area under the line is filled, it is referred to as a mountain chart. The chart shows only one data point – the closing price. The points are connected by a line.
The chart is quite simple to read as there are no complex details to consider, unlike with advanced charts, like the candles. Price charts also help easily visualise a developing trend. This is done just by looking at the direction the line is taking.
Advanced Features – For Pro Users
eToro has a set of advanced features, which can be accessed through the settings menu on the top right corner of the screen.
These features and (advanced) chart types provide more personalisation options, increased user-friendliness and additional insights. These features are typically targeted towards the more advanced or professional users.
This is an advanced personalisation option, where the charts can be viewed with a dark background. The dark theme is especially convenient when reading charts in dimly lit environments.
Advanced Chart Types
If the basic charts mentioned earlier in this document do not provide sufficient clarity and understanding, eToro provides some advanced chart options – like Heikin-Ashi and Renko Charts. These can be accessed directly from the settings menu, in the top right corner of the screen.
The Heikin-Ashi chart averages price points and presents the data in the form of a Japanese candle chart. This is done to filter out the market noise. This chart type was developed by Munehisa Homma in the 1700s.
The Renko chart, also developed by the Japanese, is built using price movement. Most other chart types use both price and standardised time intervals. The word Renko is believed to have been derived from the Japanese word for bricks, “renga,” since the chart looks like a series of bricks. A brick is created based on the price movement, in pre-defined amounts. Each one positioned at a 45-degree angle above or below the prior brick. A brick positioned above is typically coloured green, while the one below is typically coloured red.
The Pro Charts, as the name suggests, are most interesting for the professional level users. The method to enter the Pro Charts interface is described earlier in this section – settings icon in the top right corner.
Once in the Pro Charts interface, the settings menu (on the top right corner of the screen) offers a plethora of options to visualise and analyse market trends for a particular asset. It also offers features and functions to compare multiple parameters. The advanced chart types (described earlier) can also be accessed through this menu.
The chart to trade with is largely a matter of personal preference. The most important consideration should be the ease of reading and understanding. If you’re interested in playing around with the different chart types and understand their capabilities, feel free to use the eToro practice account. Be sure to choose the chart that gives you the most personal preference for your trading.
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eToro is a multi-asset platform that offers both investing in stocks and crypto assets, as well as trading CFDs.
Please note that CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 68% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.
Past performance is not an indication of future results. Trading history presented is less than 5 complete years and may not suffice as basis for investment decision.
Copy trading is a portfolio management service, provided by eToro (Europe) Ltd., which is authorized and regulated by the Cyprus Securities and Exchange Commission.
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