How to Use Thinkorswim Charts — Global Trading Software

How to Use Charts in ThinkorSwim

Trading stocks is a mind game, and the fuel is data — you’ll spend your fair share of time looking at charts.

Charts offer much-needed information regarding the stock beyond price and volume. They help traders discover trends, identify support and resistance levels, and mark entry and exit points.

The ThinkOrSwim platform offers easy-to-use and customizable charting options. ThinkOrSwim charts offer several indicators and tools for both beginners and professional traders. The image below shows the xBrat VWAP Predator and xBrat BIAS Depth Heatmap on a ThinkorSwim Chart:

thinkorswim charts

Generally speaking, ThinkOrSwim pan chart diagrams are representations of price over time (you can add other subgraphs too). You also get hundreds of technical indicators that will help you analyze the price action.

Whether you want to compare two stocks on one chart or set an alert in case the price breaks out of a trend line, ThinkOrSwim charts have got you covered. The platform has hundreds of preloaded studies and strategies.

Let’s dive into what ThinkOrSwim charts have to offer!

ThinkorSwim Chart Modes

If the default settings for ThinkOrSwim charts don’t feel right, you can switch between chart modes and choose whatever fits your needs better.

By default, you get the candle chart type. But, you can change it into a bar chart, line chart, or others as you see fit.

You have access to these chart modes:

  • Monkey Bars: These charts display price action over the timeframe under study.
  • Seasonality: This chart mode shows the number of months per year (or multiple years) when a stock rose or fell, via bars in a histogram.
  • Monkey Bars Expanded: This mode is a further expansion of the Monkey Bars.
  • Standard: This umbrella includes bar charts, area charts, candle charts, line charts, candle trend charts, and so on.

If you wish to get copies of your charts, you can always use the ThinkOrSwim charts download option and study the patterns whenever you feel like it.

ThinkorSwim Charts Aggregation Periods

The aggregation period for ThinkOrSwim charts is the timeframe of your choice for the market’s volume or price. By default, you’ll see a 1-year 1-day time frame; this means that the chart will display one-year data aggregated daily.

You can change the aggregated period to:

  • 5-minute aggregation period
  • 15-minute aggregation period
  • 30-minute aggregation period
  • 1-hour aggregation period
  • 1-day aggregation period
  • per week aggregation period

Why would you need these though?

Well, if you wish to analyze data for one month, would you be able to do so in real time? Of course not, it would be highly inconvenient. Instead, you’d be better off squeezing that information into a 30-minute aggregate period.

This way, you’d be able to analyze long-term market conditions (in the past) within a practical timeframe.

Using Chart Drawings

ThinkOrSwim web multiple charts let you draw information about market trends and help you make informed investment decisions. You can use the chart drawings and additional features to help you plan your trade and investments:

  • Overlay Stock Charts: An overlay stock chart helps you plot several stocks or indexes on a single price chart. It allows you to measure relative strength and correlations between stocks, sectors, or asset classes. For example, you can compare the financial sector and the S&P 500 index.
  • Drawing Alerts: You can also set alerts according to trendlines, retracement levels, price channels, and so on. Whenever a security price breaks through a trend, you’ll know about it right away. As soon as the prices “cross the line,” it triggers an alert.
  • Backtesting: You can backtest strategies according to indicators and get hypothetical profit and loss results via the ThinkOrSwim desktop app.
  • Future Corporate Actions: The ThinkOrSwim app also allows you to plot future dates to the right of the current date. It helps track upcoming earnings and dividend dates. Plus, you can extend drawings (i.e., trendlines) into the future to set probable price targets.
  • Probability Cone: The cone draws upper and lower bounds of a price range for ThinkOrSwim paper trading. It can enclose a predefined extent of probability, according to your preference.

ThinkorSwim Chart Patterns

Patterns in ThinkOrSwim charts help investors spot market trends that they can use to their advantage — there are three such patterns that you’ll find in the ThinkOrSwim charting software:

  • Candlestick Patterns: This pattern involves, as the name suggests, candles that show whether the market is bullish (green candles) or bearish (red candles).
  • Classical Patterns: These patterns are bigger than the rest and will only be complete after a couple of weeks.
  • Fibonacci Patterns: These patterns are based on the Fibonacci ratios (the Fibonacci sequence is a series of numbers in which one number is the sum of the pair preceding it, starting with 0, 1, 1, 2, 3, 5, and so on).

ThinkorSwim Chart sCustomization

You can create a custom ThinkOrSwim chart via simple tools you’ll find on the interface of ThinkOrSwim chart settings:

  • Symbol Selector & Header Controls: First things first, you have to determine the symbol to display the price plot on. You can type in the symbol name you need in the Symbol Selector box.
  • Volume And Lower Subgraphs: You’ll find additional subgraphs icons just below the option tabs. By default, the only visible subgraph is volume. It displays the volume histogram and volume-based studies. When you add a study to be displayed on an individual subgraph, a new subgraph is added below the volume.
  • Other Controls: Below the lowest subgraph, you have several additional controls that often come in handy:
  1. The cursor type, for instance, brings up the menu for customizing the cursor shape.
  2. If you click the right expansion, it will bring up a menu to select desired chart’s expansion area.
  3. The scrollbar lets you scroll the time axis; a single click on either arrow will allow you to scroll your chart to the left or the right.

Feel free to explore the tools you need to customize your chart drawing.

Now that you have a basic idea of how ThinkOrSwim charts work, try experimenting a bit and see what features work best for you. Study market trends to understand how you can benefit the most from your trading strategy.

Happy trading!


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