Point and Figure Charts
Module Units
- 1. Introduction
- 2. History and Development
- 3. Characteristic
- 4. Construction with Xs and Os
- 5. Point and Figure construction 1-box
- 6. Point and Figure construction 3-box
- 7. Understanding point and figure charts
- 8. Reversal patterns in 1 -box charts
- 9. Triple-Top and Bottom Patterns
- 10. The strength of the pattern
- 11. Symmetrical Triangles - Sloping Top And Sloping Bottom
- 12. The Breakout And Pullback
- 13. Traps
- 14. Poles
- 15. Congestion analysis
- 16. Trend Lines On Point And Figure Charts
- 17. Bullish Support And Bearish Resistance Lines
- 18. Parallel Trend Lines
- 19. Key takeaways from Point and Figure charts
- 20. Projecting Price Target
- 21. Counts on 1-Box Reversal Charts
- 22. Counts on 3-box reversal charts
- 23. Horizontal Counts On 3-box Reversal Charts
- 24. Things You Should Know About Point And Figure Counts
- 25. Risk-Reward Ratio From Vertical Counts On 3-Box Charts
- 26. Point & Figure Indicators
- 27. Point And Figure’s Contribution To Market Breadth
- 28. Conclusion
Characteristic
In the last unit, we focused on the origin of Point and Figure Charts. Now, let us learn some of its characteristics.
Point and Figure charts have the following unique features, all of which are explained in greater detail below:
- They are usually constructed with Xs' and Os' instead of lines or bars.
- Xs represent up movements in price.
- Os represent down movements in price.
- The Xs and Os are called 'boxes'
- Each X and 0 represents a discrete price interval, which is called the 'box size'.
- Price changes below this interval are ignored when plotting the chart.
- A column of Xs changes to a column of Os (and vice versa) when the price changes direction by a given number of boxes.
- This is called the 'reversal size' which is a very important aspect of point and figure.
- The columns of Xs and Os represent demand and supply.
- The chart sensitivity can be varied to show the short, medium and long-term position using the same data.
- No record is made of price gaps.
- Price is scaled on the vertical Y axis.
- There is no time-scale along the horizontal X axis.
- Time plays no part in the construction or analysis of Point and Figure charts.
- Although there is no time axis, Point and Figure charts are two-dimensional charts.
- Volume plays no part in the construction or analysis of Point and Figure charts.
- Point and Figure charts are named according to their box and reversal size.
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