Every trader who opens a MetaTrader 5 terminal faces a choice that seems simple at first glance: which price display mode to use? Candlestick chart type, bar chart type, or line chart type – it would seem to be a matter of personal preference. However, behind this choice lies the depth of analysis, the quality of decisions made, and, ultimately, trading profitability.
Many average traders use candlesticks out of habit, without even thinking about why this MetaTrader5 chart type offers exactly three options and what the fundamental difference between them is. And there is a difference, and it is critical. In this article, we will break down all three types, identify their strengths and weaknesses, and show with practical examples why choosing the wrong display mode can cost you a trade.
In a bar, this data is presented as a vertical line (the range from High to Low) with two horizontal ticks: the left one is the Open, the right one is the Close. In a Japanese candlestick, it is the body (from Open to Close) and the shadows/wicks (from the body to High and Low).
The similarity between candlesticks and bars is fundamental: both types provide complete information about price movement over the period. Both allow you to see where the price was at the beginning and at the end, and what extremes were reached. Both types are suitable for building any indicators and for technical analysis.
The difference lies in visual perception. Candlesticks, thanks to their colored bodies, instantly show the direction and strength of the impulse: a bullish candle (price increased) and a bearish candle (price decreased) are visually distinct. Bars require closer attention: you need to compare the position of the left and right ticks. That is precisely why the vast majority of traders prefer candlesticks – hundreds of strategies and patterns have been developed for them.
At first glance, a line chart seems like an ideal tool for quickly assessing a trend: the line is clean, without "noise," making it easy to visually determine the direction of movement. Many traders use it to identify long-term trends or as a background for overlaying indicators.
Imagine a hypothetical situation: you are trading on the 1-hour timeframe. During the hour, the price opened at 1.1000, rose to 1.1050, then crashed to 1.0950, and closed at 1.1000. On the line chart type, you will only see a flat horizontal line – the price hasn't changed. No signals. No levels.
On the candlestick chart type, you will see a long upper wick (up to 1.1050), a long lower wick (down to 1.0950), and a tiny body. This is a classic "Spinning Top" pattern – a signal of indecision and a potential reversal.
On the bar chart type, you will see a vertical line from 1.0950 to 1.1050 with ticks at 1.1000 on the left and right – the same information.
Why shadows are critically important. Candlestick shadows show which levels were tested during the period. Was a resistance zone tested? Was there a false breakout attempt of support? On a line chart, this is simply impossible to see. You won't know that the price touched a key level, nor will you know if there was a reaction from buyers or sellers. And yet, this data often provides the earliest signals of a trend reversal. Moreover, weekly and daily candlesticks like Doji are among the strongest standalone signal indicators.
This allows you to instantly switch between types, comparing the display of the same market segment. Try it – the difference will be obvious.
Suppose you are analyzing the EUR/USD pair on the daily timeframe. On the line chart type, you see a steady uptrend: the closing price each day is higher than the previous one. Everything looks solid, and you open a long position.
However, if you switch to the candlestick chart type, the picture changes. Over the last three days, the candles have long upper shadows – each day the price tried to make a new high but met strong resistance and pulled back to the close. This is a classic sign of weakening bullish momentum. The market may be preparing for a reversal.
Many average traders use candlesticks out of habit, without even thinking about why this MetaTrader5 chart type offers exactly three options and what the fundamental difference between them is. And there is a difference, and it is critical. In this article, we will break down all three types, identify their strengths and weaknesses, and show with practical examples why choosing the wrong display mode can cost you a trade.
Bars and Candlesticks: Two Views of the Same Story
Let's start with the main point: bar chart type and candlestick chart type display the same information – the open, high, low, and close prices for the selected period. Each bar or candlestick represents four key points:- Open (O) – the opening price of the period;
- High (H) – the highest price;
- Low (L) – the lowest price;
- Close (C) – the closing price.
In a bar, this data is presented as a vertical line (the range from High to Low) with two horizontal ticks: the left one is the Open, the right one is the Close. In a Japanese candlestick, it is the body (from Open to Close) and the shadows/wicks (from the body to High and Low).
The similarity between candlesticks and bars is fundamental: both types provide complete information about price movement over the period. Both allow you to see where the price was at the beginning and at the end, and what extremes were reached. Both types are suitable for building any indicators and for technical analysis.
The difference lies in visual perception. Candlesticks, thanks to their colored bodies, instantly show the direction and strength of the impulse: a bullish candle (price increased) and a bearish candle (price decreased) are visually distinct. Bars require closer attention: you need to compare the position of the left and right ticks. That is precisely why the vast majority of traders prefer candlesticks – hundreds of strategies and patterns have been developed for them.
ℹ INFO
The key advantage of bars and candlesticks over the line chart is that they show the full price range for the period. This allows you to assess volatility and see the resistance and support levels that price tested but did not break. This information is precisely what underlies informed trading decisions.
Line Chart: Convenience That Can Deceive
The line chart type in MetaTrader 5 is a broken line connecting the closing prices of each bar or candlestick. It provides the most simplified representation of price movement.At first glance, a line chart seems like an ideal tool for quickly assessing a trend: the line is clean, without "noise," making it easy to visually determine the direction of movement. Many traders use it to identify long-term trends or as a background for overlaying indicators.
⚠ IMPORTANT
However, this is precisely where the main danger lies. The line chart does not provide an accurate understanding of what happened inside the period. It ignores highs and lows, showing only the final point – the closing price.
Imagine a hypothetical situation: you are trading on the 1-hour timeframe. During the hour, the price opened at 1.1000, rose to 1.1050, then crashed to 1.0950, and closed at 1.1000. On the line chart type, you will only see a flat horizontal line – the price hasn't changed. No signals. No levels.
On the candlestick chart type, you will see a long upper wick (up to 1.1050), a long lower wick (down to 1.0950), and a tiny body. This is a classic "Spinning Top" pattern – a signal of indecision and a potential reversal.
On the bar chart type, you will see a vertical line from 1.0950 to 1.1050 with ticks at 1.1000 on the left and right – the same information.
Why shadows are critically important. Candlestick shadows show which levels were tested during the period. Was a resistance zone tested? Was there a false breakout attempt of support? On a line chart, this is simply impossible to see. You won't know that the price touched a key level, nor will you know if there was a reaction from buyers or sellers. And yet, this data often provides the earliest signals of a trend reversal. Moreover, weekly and daily candlesticks like Doji are among the strongest standalone signal indicators.
How to Switch Between Chart Types in MetaTrader 5
The MetaTrader 5 platform offers several ways to change the display mode:- Toolbar – click the corresponding button to switch between line chart, bars, and candlesticks.
- Charts menu – select the desired type from the dropdown menu.
- Context menu – right-click on the chart and select the type.
- Hotkeys:
- Alt + 1 - bars,
- Alt + 2 - candlesticks,
- Alt + 3 - line.
This allows you to instantly switch between types, comparing the display of the same market segment. Try it – the difference will be obvious.
Practical Example: Why a Line Chart Can Kill a Trade
Suppose you are analyzing the EUR/USD pair on the daily timeframe. On the line chart type, you see a steady uptrend: the closing price each day is higher than the previous one. Everything looks solid, and you open a long position.
However, if you switch to the candlestick chart type, the picture changes. Over the last three days, the candles have long upper shadows – each day the price tried to make a new high but met strong resistance and pulled back to the close. This is a classic sign of weakening bullish momentum. The market may be preparing for a reversal.
⚠ IMPORTANT
A mistake to avoid: never make trading decisions based solely on a line chart. It provides only 25% of the information (the closing price), ignoring the other 75% (open, high, low). This is like diagnosing an illness based on a single symptom while ignoring the rest.
ℹ INFO
The right strategy: use the line chart as an auxiliary tool – for a quick visual assessment of the overall trend. However, all key decisions, level identification, pattern analysis, and trade entries should be based on candlesticks or bars, which provide the complete picture.
FAQ
1. What is the fundamental difference between bars and candlesticks if they show the same data?
There is no fundamental difference in the data – both bars and candlesticks display Open, High, Low, and Close. The difference is solely in visual presentation. Candlesticks, due to their colored bodies, instantly show the direction of movement and the strength of the impulse. Bars require more careful analysis: you need to compare the position of the left and right ticks to understand whether the price rose or fell. Most traders choose candlesticks precisely because of their clarity and the large number of patterns developed specifically for this chart type.
2. Can a line chart be used for technical analysis?
It can, but with serious limitations. The line chart is useful for quickly assessing the overall trend direction, especially on higher timeframes. However, it is unsuitable for analyzing support and resistance levels, identifying reversal patterns, or assessing volatility. Any serious technical analysis should be performed using candlesticks or bars, which show the full price range for the period.
3. Which chart type is best for a beginner trader?
For a beginner trader, the optimal choice is the candlestick chart type. It is the most intuitive, allows for quickly learning basic patterns (Hammer, Hanging Man, Engulfing, etc.), and provides complete information about price movement. Bars can be useful as an additional tool for those who want to see the data in a more "classic" form. The line chart should only be used for auxiliary purposes, for example, as an overlay on the main chart as a trend indicator.
4. How do I quickly switch the chart type in MetaTrader 5?
MetaTrader 5 provides several methods: - On the toolbar, click the button with the corresponding icon. - In the "Charts" menu, select the desired type. - Right-click on the chart and select the type from the context menu. - Use the hotkeys:
(bars),
(candlesticks),
(line).
Code:
Alt + 1
Code:
Alt + 2
Code:
Alt + 3