Market Basics · Chart Academy · Chart literacy · Updated 2026-08-30
How to read a price chart
Time, price, OHLC, intervals, volume and scale — what a candle actually compresses, and why the same asset looks different on every timeframe.
가격 차트 읽는 법 — 시간, 가격, OHLC, 캔들 간격, 거래량과 스케일 — 캔들 하나가 무엇을 압축하고 있는지, 그리고 왜 같은 종목이 시간대마다 달라 보이는지.
What it is
A price chart plots time along the horizontal axis and price along the vertical axis. Each mark on it — a candle, a bar, a point on a line — summarises everything that happened during one interval of trading.
The four numbers that summarise an interval are the open, the high, the low and the close: OHLC. The open is the first traded price of the interval, the close is the last, and the high and low are the extremes reached in between. Most charts also carry a volume panel underneath showing how much was traded in that same interval.
How to spot it
Before reading anything into a chart's shape, check three settings, because all three change what you are looking at.
- Interval — a 15-minute, daily and weekly chart of the same asset can tell three different stories. Neither is wrong; they answer different questions.
- Scale — a linear axis gives equal space to equal price moves; a logarithmic axis gives equal space to equal percentage moves. Over long histories the difference is dramatic.
- Adjustment — adjusted prices account for splits and dividends. Unadjusted prices show what actually printed. Comparing one to the other produces phantom gaps.
Why people watch it
A chart is a record of an auction. Every candle is the compressed result of buyers and sellers disagreeing about price for a fixed span of time, then settling somewhere. Reading charts well is mostly reading that record honestly rather than projecting a story onto it.
Confirmation
There is nothing to confirm at this stage — this lesson is about literacy, not about a setup. The habit worth building now is stating your interval and scale out loud before you say anything about the shape.
Invalidation
If your read depends on a shape that disappears when you switch from a linear to a log axis, or from adjusted to unadjusted prices, the shape was an artefact of the setting, not a feature of the market.
Common mistakes
- Comparing two charts with different intervals or scales and treating the difference as a market signal.
- Reading an unadjusted chart across a stock split and calling the gap a crash.
- Assuming a longer timeframe is always 'more correct' — it is more durable, which is not the same thing.
Quick check
1. A daily candle's close is near its high. What does that tell you on its own?
- Price will continue higher tomorrow
- Buyers controlled the interval into the close
- The asset is overbought
- Nothing at all
Show answer
B. Buyers controlled the interval into the close
Close location describes who controlled the interval as it ended. It is an observation about that candle, not a forecast about the next one.
2. The same stock looks like an uptrend on the weekly and a downtrend on the 15-minute. Which is right?
- The weekly — longer is always correct
- The 15-minute — it is more current
- Both, at their own timeframes
- Neither, the chart is broken
Show answer
C. Both, at their own timeframes
Timeframes answer different questions. The honest label is 'mixed' or 'counter-trend', and GMR states that disagreement rather than hiding it.
3. Why can a log scale change how a long-term chart looks?
- It hides volatility
- It gives equal space to equal percentage moves rather than equal price moves
- It removes dividends
- It only affects crypto
Show answer
B. It gives equal space to equal percentage moves rather than equal price moves
On a linear axis a move from 10 to 20 looks the same size as 100 to 110. On a log axis the first is far larger, because it is a much bigger percentage.