In short
- A chart shows how a price has moved in the past.
- A candlestick sums up four prices: open, high, low and close.
- A chart does not say why the price moved or what it will do next.
The line chart
The simplest chart joins the closing prices, day after day. It gives a quick view of the trend, but it does not show what happened during each session.
The candlestick
Here is a made-up session, summed up by one candlestick:
| Data | Price | On the candlestick |
|---|---|---|
| Open | 100 DH | Bottom of the body, if the session rises |
| High | 108 DH | Top of the wick |
| Low | 98 DH | Bottom of the wick |
| Close | 105 DH | Top of the body, if the session rises |
The body joins the open and the close. The wicks show the session’s extremes. The colour often shows a rise or a fall, but it can differ from one platform to another.
Settings to check
- The period: a fall over one week may be a small move over five years.
- The scale: a narrow scale can make a move look very strong.
- The volume: it shows the amount traded and helps you spot very active sessions.
- Corporate actions: a stock split or a dividend can change the picture if prices are not adjusted.
An example of an illusion
Made-up example: a share goes from 100 to 102 dirhams. If the axis runs from 100 to 102, the line fills the screen and looks dramatic. If the axis runs from 0 to 200, it looks almost flat. The rise is the same in both cases: 2%.
A chart describes the past. It does not predict the future and does not replace reading the company’s results.
Frequently asked questions
Why do charts differ from one site to another?
They may use delayed data, other settings or prices adjusted in a different way.
Does a long wick announce something?
It shows that the price moved a lot during the session. It does not reliably announce what comes next.
This article is for information and educational purposes only. It is not investment advice or a recommendation to buy or sell any security. Investing in shares involves a risk of capital loss. Check figures against official sources (Casablanca Stock Exchange, AMMC) and consult a licensed professional. Read the full disclaimer.
