Forexbeginner

How to read forex charts

Bid/ask, spread, time frames, and session overlap.

TL;DR

Forex charts look like stock charts but with different conventions. The pair tells you what you're charting (EUR/USD = euros per dollar). Daily candles roll at 17:00 New York time, not at midnight.

Reading the quote

EUR/USD = 1.0850 means it costs $1.0850 to buy €1. If EUR/USD rises, the euro is strengthening vs the dollar.

Charting conventions

A few quirks unique to forex.

→Daily candles roll at 17:00 New York time
→Sunday 17:00 NY = new week's open
→No overnight gaps within the trading week
→Volume is broker-specific (no centralised data)

Session overlap

Spreads tighten and volatility rises during the London/NY overlap (13:00–17:00 UTC). EUR/USD, GBP/USD are most active here. Trade outside the overlap and you pay wider spreads.

Worked example

EUR/USD daily candle breakdown

Today's daily candle: open 1.0825, high 1.0860, low 1.0810, close 1.0850.

1DirectionGreen (close > open)
2Range50 pips
3Body25 pips
4WicksUpper 10, lower 15
5ReadSteady advance, bulls in control, not exhausted

Takeaway

FX daily candles roll at NY close. Comparing to crypto/stock charts that use midnight UTC, you're looking at different windows.

Common mistakes

What to avoid

!Trading thin Sydney candles as if they reflect global sentiment
!Comparing FX volume across brokers
!Ignoring rollover (swap) charged at 17:00 NY
!Reading USD/JPY as 'dollars per yen' — it's yen per dollar

Self-check

Test yourself

Q1If EUR/USD goes from 1.08 to 1.10, did the euro strengthen?+

Yes — it now takes more dollars to buy one euro.

Q2When do forex daily candles roll over?+

17:00 New York time.

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