The term "horizontal line" is used in finance and economics as the x-axis in the chart. We proceed this line from left to right. The term comes from the geometric analysis, where this line is widely used alongside with the vertical line (y-axis).
In technical analysis, the horizontal lines represent the part of the charts. A chart shows the movement of prices over time, with the horizontal axis showing the time scale and vertical axis showing the price scale. You can insert additional horizontal and vertical lines to the chart. The vertical ones are used to determine the time when the candlestick appears. The horizontal lines, in their turn, serve as a necessary trading instrument which helps a trader to determine support and resistance levels.
Horizontal lines are used in horizontal analysis. It compares the value of prices over time. The horizontal analysis may be helpful for a fundamental analyst, where an analyst compares the reports or statements over time. Time acts as the x-axis here and allows to calculate the percentage changes over time.
Horizontal lines are also a part of supply and demand curves with the price on the vertical line and quantity demanded on the horizontal line on a graph.
2020-07-23 • Updated