Logarithmic or Linear Charts?

Discussion in 'Trading' started by TraderGreg, Jun 6, 2008.

  1. Which are better for trading? I generally use the logarithmic charts because it makes more sense for % gains/losses and price objectivity. But, the case can be made that regular investors rely more on price changes rather than percentage changes, and also look at linear charts when making decisions (for example, oil rising $10 a barrel is more common talk than it rising 7-8%). Thanks for your help.
  2. Log charts are deceptive and I would avoid them at all cost. The world doesn't think in logarithms.

    The problem with log charts is they distort patterns. A blowoff top can be smoothed with a log chart so it looks linear. This is misleading.
  3. think in logs, but trade linear.