As a full-time trader, I use a great number of tools in my trading tool chest. Software is one of the greatest tools and I take for granted how much easier it is for me to do analysis compared to even 10 years ago – things keep improving. But there is one thing that software has an issue with, and that’s with the perspective of a price chart.

Because I am a technical analysis ultra-nerd, I chart some of the instruments I trade by hand – just the weekly candles though. I’m not sure if I coined the phrase or not, but I called it terrestial charting. When I was catching up with the past few weeks, I again realized how much more accurate trendlines are on hand-made charts compared to software. And it reminded me of the perspective I get from a hand drawn chart. Perspective is key to technical analysis, and it’s especially important for instruments like Bitcoin.

Logarithmic charts VS Linear charts

Let’s go through a quick definition of what linear and logarithmic charts are.

Linear chart – price is scaled to be equal, so 5, 10, 15, 20, 25, 30, etc. You see an equally divided price chart.

Logarithmic chart – price is scaled according to percent changes, so two equal percent changes are going to have the same vertical change/distance.

Ok, that sounds confusing, but let’s look at an example, the Nasdaq.

### Nasdaq Linear Price Scale Chart

This chart is probably the type of scale you are most familiar with, it’s the scale I use for charting 90% of the time. It’s the scale of charting I show here quite often.

### Nasdaq Logarithmic Price Scale Chart

This looks different, doesn’t it? Provides a little different context and perspective than the linear chart. Especially the slope and the angles. Trend lines are especially important here. But let’s look at Bitcoin’s linear and logarithmic charts.

### Bitcoin Logarithmic

Bitcoin, especially, shows the difference between the two chart scales. Bitcoin is actually a perfect example of an instrument that benefits the most from a logarithmic scaled chart. Why? Trendlines.

### Bitcoin logarithmic trendlines

We can see that the logarithmic scale is not only much easier to draw a trend line against for the entire price history on this chart, but it provides a very easy to identify support zone for the present trading conditions.