Line Charts
Line Charts: The Simplest View
A line chart is the most basic type of stock chart. It plots a single data point for each time period — usually the closing price — and connects those points with a continuous line. If you have ever seen a stock chart in a newspaper or on a news broadcast, it was almost certainly a line chart.
How Line Charts Work
For each trading day on the NSE, the chart records the closing price (the last price at which the stock traded before the market closed at 3:00 PM). These closing prices are then connected to form a smooth line that shows the price journey over time.
For example, if you pull up a line chart for Safaricom (SCOM) over the past year, you will see a single flowing line that shows how the closing price moved from month to month.
Advantages of Line Charts
- Clarity — Easy to read and understand, even for beginners
- Trend visibility — The overall direction of the stock is immediately obvious
- Clean look — No clutter from extra data points; perfect for a quick overview
Limitations
- Missing detail — You only see the closing price. You cannot tell how high or low the price went during the day.
- No open price — You do not know where trading started each day.
- Hides volatility — A stock could swing wildly during the day but close near the same price, and the line chart would look flat.
When to Use Line Charts
Line charts are ideal when you want a quick, clean overview of a stock's price history. They are also useful when comparing multiple stocks on the same chart, since overlapping lines are easier to read than overlapping candlesticks. On Stockr, the default chart view for NSE stocks uses a line chart for simplicity.