How to use charts properly

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How to use charts properly?

How To Use Charts Properly?

The binary options market has experienced a significant increase of popularity over the last few years, and that trend is more than likely to continue in the future. The main reason for that can be found in the simplicity this kind of trading offers, its fast learning curve and a huge number of brokerage companies. Trading interfaces are usually pretty well designed and easy to understand, but some traders have problems when it comes to charts usage. Every trader needs to learn how to use charts properly in order to experience success, so we will cover the basics here and give you some useful tips. Read on!

How to use charts properly? | Basic types

The first thing you need to familiarize yourself with in order to know how to use charts properly is chart types. Choosing your ideal chart type is connected to knowing How to choose the right strategy. The simplest type is the line chart, created by joining closing prices of a selected asset over a period of time. The drawback is that it doesn’t provide you with any type of history like opening prices for every individual point. However, the closing price is pretty much everything you need to predict right, so this type of chart will do the job just fine, especially if you’re a beginner. Bar charts, on the other hand, display information about high and low prices, as well as opening and closing prices for each point. They consist of vertical bars interconnected with horizontal dashes that represent opening and closing prices. Their colors depend on rising or falling of their price and this makes it easier for traders to understand the future trends. You will also come across candlestick charts, which are very similar to bar charts. However, there are some differences regarding their visual construction. Candlestick charts contain one wider bar that represents the difference between high and low price for every time point. These bars can contain one of three different colors depending on the asset’s price direction. But if you want to know how to use charts properly, you must learn more. Keep reading!

How to use charts properly? | Patterns principle

In order to know how to use charts properly, traders should understand and embrace the concept of patterns as Trend Indicators. Basically, patterns are recurring parts of your chart that are used for predicting current and future asset fluctuations. Binary options signals are based on the pattern principle as well. There are two main types of patterns – reversal, signaling that previous trend will reverse after the pattern is complete, and continuation, which signal that rising or falling will continue after the pattern is complete. There are many popular chart pattern types, such as head and shoulders, cup and handle, triangles and such that have been proven to work, and we have covered most of them here on our website, so be sure to check it out.

How to use charts properly? | Conclusion

We have reviewed the basic principles you need to learn in order to know how to use charts properly. Pretty much every trading platform contains them, so ignoring education about this aspect of trading can hurt your profit a lot. Do your best to acquire as much knowledge on this issue as possible, it will be well worth it. We wish you lots of luck in your trading!

1. A course in financial calculus (A Etheridge – 2002)
2. The Mathematics Of Money Management: Risk Analysis Techniques For Traders (R. Vince, 1992)
3. Cybernetic Analysis For Stocks & Futures (J. F. Ehlers, 2004)
4. Irrational Exuberance (R. Shiller, 2000)
5. Rich Dad, Poor Dad (R. Kiyosaki, 2000)

How to properly use a pie chart

It might seem odd to talk about pie charts out of the blue, but let me guarantee that I want to talk about them precisely because of the timing.

It all began with a post from the Office for National Statistics discussing guidelines on the use of the dessert chart. Then over the weekend Cole Knaflic, author of Storytelling with Data, updated her stance on pies (hint: she still dislikes them).

Whether you love them or hate them, the humble pie chart is here to stay. But if it is to stay, we should at least make sure it stays in the right context. That its used the proper way.

What’s wrong with the pie?

So you might be wondering: Is there an improper way to use the pie chart?

Yes. Lots. Pie charts are one of the most difficult charts to use because it doesn’t have a common baseline.

When comparing values, we’re used to comparing off the same baseline. See the example below where its easy to say which bar is tallest and shortest because all the bars are along the same axis.

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Without having to think I know #3 is the tallest, #5 is the shortest. BBC KS3 Maths: Bar Charts.

But with pie charts, there is no single axis to baseline off. Instead we’re comparing areas of sectors or arc lengths.

What comes more natural to you? Getting the:

  • length of a bar?
  • Or the arc length of a circle?

If you answered the latter, then go ahead and use pie charts.

But assuming you’re like most people, the second one takes takes some extra brain power to process. In data visualization, that extra cognitive load is a sign you’re doing something wrong. The chart is meant to make people’s lives easier by visualizing the data for them, not make it even harder.

If the values can be compared in a bar chart, go with the bar chart. Don’t make your audience do the extra math that comes with using a pie chart.

This problem is further compounded when the chart is in 3D:

The third dimension skews the physical appearance of the chart. This is called forced perspective:

Forced perspective is a technique which employs optical illusion to make an object appear farther away, closer, larger or smaller than it actually is. It manipulates human visual perception through the use of scaled objects and the correlation between them and the vantage point of the spectator or camera.

When in 3D, the sectors that are closer to the eye seem larger due to forced perspective, even though in reality they may be physically smaller. Look at that Firefox sector… doesn’t it seem larger than I.E.?

This defeats the purpose of the chart, which is meant to represent the relative sizes of data.

When should I use the pie?

So, we now know the pie chart isn’t very good at comparing values. But there is one thing the pie is good at, even better than any other chart I know of.

It’s very good at representing something is part of a whole.

When we think of pie charts, what comes to mind is the slice of pie, not necessarily the whole pie itself.

Pie charts are excellent at showing the composition of a whole (i.e., that the sum of parts is 100%).

But does this mean we should always be using pie charts to show composition?

Again, no. As always it depends on context.

If we’re comparing the relative magnitudes of the parts that comprise the whole, again the bar chart wins. Its comparing values after all.

But if we just care to emphasize that yes, these parts comprise the whole, regardless of by how much, then the pie chart wins.

It all depends on where you’re putting emphasis on. Again, it depends on context.

Pie charts are especially effective for single values that are relatively small compared to the whole. See example 10% pie chart above.

Think: Into how many slices do you usually cut your pizza?

Chances are, your average slice looks like the pie chart above. It works because it matches our mental image of what a slice of pie (or pizza) is supposed to look like.

So, part of a whole, and even better if that part is small. When you need to represent your data in such a way then pie charts are the way to go.

Otherwise, stick to other charts that better suit your purpose.

Note that this is bar any aesthetic considerations, such as having lots of roundish shapes in the same page. In that case you’re going to have to consider which is more important: context or design. I’d say context, but this always leads me to arguments with my art-inclined friends ��

UPDATE: I found this great post which talks through use cases of when using a pie chart is okay.

The Ultimate Guide to Gantt Charts: Everything about the Tool You Can’t Ignore for Project Planning

A Gantt chart is a great tool for task management, project planning, scheduling, and progress tracking.

In case you don’t know a fact about these diagrams, here is the complete guide to Gantt charts that covers most of the questions.

What is a Gantt chart?

A Gantt chart is a bar chart with two axes – a horizontal one and a vertical one. The first one is used to define start and end dates while the latter is used to present tasks.

This diagram shows all your assignments and their dates along a timeline. In other words, it is a clear visually appealing schedule of your and your team tasks and dates that can be connected to each other.

As you see, with a Gantt chart, you will know what work has to be done, current work as well as what has already been accomplished. It also helps keep track of the progress of your plan or project and be aware of all the deadlines in advance.

What is a Gantt chart used for?

A Gantt chart is used to cover several project management issues. However, one of them is fundamental.

With its help, you can easily schedule every phase of a plan regardless of its duration with clearly defined start and end dates.

In addition, a Gantt chart helps identify milestones – significant events in your projects with no duration – and deadlines. Don’t want to miss a date? The Gantt diagram is your solution!

With the advance of online Gantt chart software, the chart becomes a handler in other situations. In particular, it helps manage resources, cost, and collaborate between team members.

Put it shortly, a Gantt chart is used for:

  • Task scheduling.
  • Identifying milestones.
  • Keeping track of deadlines.
  • Keeping track of progress.
  • Connecting tasks with dependencies.
  • Collaboration.
  • Resource management.
  • Cost management.

What information is included in a Gantt chart?

A typical Gantt chart should include the following information:

  • Tasks, their duration, status, and priority.
  • Start and end dates.
  • Progress.
  • Timeline with the time scale.
  • Milestones.
  • Dependencies between tasks.
  • Deadlines.
  • Critical path.

A robust Gantt chart tool that is able to cover most of the needs of project managers will also include:

  • Assignees.
  • Estimations.
  • Resource workload: who works on what tasks, who is overloaded, who can be given more tasks.
  • Costs.
  • Options that allow customizing plans.
  • Comments, attachments, notifications for teamwork.
  • Baselines.
  • Templates.
  • Auto scheduling.

So, if you need an answer to the question “What are the main features of a Gantt chart?”, just look above – these features help build solid projects and organize all the teamwork.

Example of a Gantt chart

Here is how GanttPRO online Gantt chart software – one of the most robust and intuitive tools in the market and a perfect example of the diagram – looks like.

How to create a Gantt chart?

Fortunately, this is not even a point to consider when you build a project because modern solutions make this process easy and enjoyable. Of course, applications differ and range from hard-to-manage solutions to intuitive software with easy-to-understand UX/UI design.

It is simple unless you take not designed for Gantt chart building solutions. Like Excel. Or powerful but not modern like MS Project.

Can I make a Gantt chart in Excel?

Unfortunately, you can. Why unfortunately? Because Excel was not designed for creating Gantt chart, especially dynamic ones.

In case you have time and desire to do it, here is a guide on how to make a Gantt chart in Excel.

How to create a Gantt chart in MS Project

MS Project allows working with Gantt charts and offers hundreds of features. However, this tool is too complicated and requires too much time to learn it.

From this MS Project tutorial, you can learn some basic instructions.

In general, you need to follow four simple steps in order to create a Gantt chart:

  • Add tasks.
  • Define dates for tasks and the whole calendar.
  • Connect tasks with dependencies.
  • Assign tasks.

How to use a Gantt chart?

It is very easy to use a Gantt chart as a diagram itself is simple to read yet it is very powerful. Do not be surprised but:

In case you decided to create one in online software (it is 21-st century and I won’t expect anyone to make it in any other way), it largely depends on a tool you’ve chosen. Anyway, it is as simple as ABC.

Why is it simple?

This bar chart is the perfect way to visualize tasks, milestone, and dates.

This is the most efficient solution to connect tasks with dependencies.

And it helps respect deadlines and be aware of them in a timely manner.

You see: a Gantt chart shows the most crucial elements of a project. And it is very easy to use it in project management.

When to use a Gantt chart

Use it when you need to plan any event both personal and team: preparation for an exam, apartment renovation, wedding preparation, house building, in marketing campaign and software development, and much more. If you have tasks with certain timeframes and goals to achieve – meet a Gantt chart.

Advantages and disadvantages of a Gantt chart

It is highly likely that now you think something like “Wow, what a great tool it is! Aren’t there any disadvantages?”

As anything in our world, a Gantt chart is reviewed from different perspectives.

What are the advantages of a Gantt chart?

It is transparent, clear, and structured

Imagine that you need to promote your brand to increase sales volume. You will probably be scared from the very beginning as it is difficult to define where to start and how to measure deliverables.

A Gantt chart allows breaking down projects into smaller pieces that can take from a few hours to a few days. The more you chunk, the higher the chances are to complete a project as each task is clearly defined. This is a critical advantage of a Gantt chart in project management.

It allows connecting tasks

You hardly find a project where tasks exist separately from each other. Usually, they are presented in certain orders. For example, a finish date of one task gives a start to the other.

In a Gantt chart tool, you can easily connect tasks with dependencies to show the relationship between them.

Let’s take an example.

You need to plant a tree. With the help of the diagram, you will be able to connect interdependent phases.

Dig a hole place a tree straighten it if needed fill the hole carefully handle it if needed.

This consequence of events shows that you can’t start with the last action as it is dependent on the previous ones.

It can be shared for presentation

Robust Gantt chart solutions provide with the Sharing and Export features as one of the benefits. They allow showcasing plans, current or any other states of a project to anyone outside your team: stakeholders, clients, customers, etc.

It keeps motivation and focus

Once a project plan is ready, this becomes a point of reference for you and your team in case you manage a team project. This is like the single source of truth that helps to avoid a project scope creep.

Also, some people work more efficiently when they have everything structured in one place and where the progress, goals, and results are shown with a clear focus and no ambiguity. And remember about resource allocation: it will keep project participants motivated as the tasks assigned to them are clearly defined.

It is good for collaboration

Team projects can’t exist without collaboration. Forget about success if there is no collaboration in your schedule.

A cutting-edge Gantt chart generator is no longer a place for tasks and dates. It is far more than that. Tasks always need to be commented and attached with necessary documents as well as project participants need to be constantly notified about assignments, deadlines, and other updates.

A Gantt diagram can become a hub for all project-related information and communication.

It allows allocating resources properly

Without resources, one can hardly imagine a project. Those resources can be real or virtual and they need to be properly managed.

The resource workload feature helps managers avoid situations when some resources are overloaded and some are free for performing tasks.

Proper allocation leads to proper budget management.

It shows the critical path

A critical path is a feature that shows the connection of the most important tasks needed for a project to be successfully completed.

GanttPRO is online Gantt chart software that helps thousands of individuals and teams manage their tasks, deadlines, resources, and costs. Great for communication and collaboration on a project.

Disadvantages of using Gantt charts

No place for uncertainty

One of the core limitations of a Gantt chart is that it perfectly serves for projects where all the tasks, milestones, deliverables, and dates are known from the start – all in all, this is how the Work Breakdown structure works.

However, this is not the dead end. Efficient Gantt chart creators allow making adjustments at any moment of project development. The Auto scheduling function will change the dates of interdependent tasks automatically.

May not be suitable for too large projects

This is the universal truth: a Gantt chart won’t be the best choice for long-term projects. By long-term projects those projects are meant that last two and more years. Adding new tasks and resources to a plan will force you to constantly scroll up and down your chart to find the item you are looking for.

However, breaking down a large project into smaller ones can turn this disadvantage into a benefit. Also, search options are at your service.

It needs to be constantly updated (doubtful)

Yes, projects will require time on management and updates. But what does not require it to do work?

All the work you do will take your time. However, you can make these processes shorter turning yourself into a rockstar of a certain application where you are like a duck to water.

Where to use a Gantt chart?

Thanks to timeline and tasks oriented nature, Gantt charts find their application in dozens of spheres with few limitations.

Gantt chart for IT development:

  • Website development.
  • Software development.
  • Game development.
  • Program development.
  • Agile software development.
  • App development.
  • Android application development.
  • Mobile app development, etc.

Gantt chart for construction:

  • Construction project schedule.
  • House construction, renovation, remodeling, etc.
  • New home construction.
  • Construction management, etc.

Gantt chart for event planning:

  • Performance planning.
  • Conference planning.
  • Fundraising event planning.
  • Exhibition planning.
  • Workshop planning, etc.

Gantt chart for marketing campaigns:

  • Product marketing.
  • Content marketing.
  • Digital or online marketing.
  • Offline marketing, etc.

Gantt chart for design:

  • Architectural design.
  • Web design, etc.

And many more!

What is a Gantt chart template?

A Gantt chart template is the ready-made chart with typical tasks and dates that you can use in a certain industry.

Powerful solutions offer Gantt chart templates for a variety of industries:

  • Software development.
  • Construction.
  • Marketing.
  • Professional services or maintenance.
  • Manufacturing.
  • Retail.
  • Education.
  • Event planning.
  • Design.
  • Consulting, etc.

Conclusion

Gantt diagrams are tools for robust task management, project planning and scheduling, resource and cost management as well as for communication and collaboration on a project.

What’s your attitude to Gantt charts? Do you use any software? Please share your experience with us in the comments below.

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