Vertical Line Charting

There are different schools in the investment world, and one of the biggest is technical analysis vs. fundamental analysis.

Technical analysis fanboys believe that the answers to future price movements lie in the candlesticks. The stock chart candlesticks, not the fortune teller kind. (They're often right until they're wrong, when they're then very, very wrong, and lose everything.)

Fundamental analysis fanboys believe that the technical analysis kids might as well be reading tea leaves. Instead, they think the trick is to research the intrinsic value of a company's ability to produce earnings by looking over its financial statements, management...things like that. Then you invest in stocks that appear to be have good, long-term future earnings prospects.

Vertical line charting is one of the tools in the technical trading toolbelt, so fundamental fanboys: you can stop reading now.

Vertical line charting is one of the most basic tools of technical analysis. It tracks the price trend of a security, taken as daily averages, with the high and the low price of the day. These are what make up the basic lines on vertical line charts, similar to candlestick charts, which also include opening and closing prices.

It’s pretty easy to “eyeball” basic up-or-down trends on a line chart, which is why vertical line charting is so popular. Easy peasy.