I've recognized the importance of some consistancy in viewing charts, especially as I have used Big Charts on the internet and they have all sorts of different scales and the "boxes" resemble all different sizes from perfect squares to long rectangles. It really can be a little difficult judging the downtrending action or base of these charts when these distortions are so evidently present and vary from stock to stock.
Ted, in his book, discusses the value of long range charts on page 135. Specifically, the long range charts that we use to base our buy and sell decisions on, should have a contrast of action including the previous top, to have any real value. Ted additionally notes the deceptiveness of chart scaling on page 253 when he discusses that if the chart of CGI was on a 50 cent scale, the uptrend would have been just over 45 degrees.
In trying to get a grasp on properly judging a charts action, I noticed that in both Ted's book and the United States Chart Company Stock Charts (Which Tony Church was very generous in sending them to me-thanks Tony!) that there is one thing that appears to make all these charts have "good contrast". That one thing is that whatever dollar figure or scale that is used on the right of the chart, it almost always forms a "square" box with a one year period along the horizontal axis.
Although this still amounts to a very subjective approach (ie: 45% uptrend is relative to the scale on the right), I believe this practice of using "good contrast" with past long term action will bring about more comfort when viewing on-line charts.
An example of the confusion of viewing on-line charts and of how good contrast can clarify chart reading can be seen with Hurricane Hydrocarbons. I viewed this stock and initially thought that this is one that all Ted Heads would not have entered. Look at the break of that steep downtrend on the long term chart. There appears to be really no decent period of accumulation that occured with this stock.
http://www.bigcharts.com/custom/investorline-com/investorline.asp?sid=103400&o_symb=hhl.a&symb=hhl.a&time=20&comp=&compidx=aaaaa%3A0&country=ca&draw.x=42&draw.y=12
If we take a closer look at this chart, though, we may recognize the "bad contrast" we have in that the rectangular boxes actually compress the whole chart. Look at the chart again with it adjusted to have good contrast as the charts in Ted's book and the US chart company have.
http://www.bigcharts.com/custom/investorline-com/investorline.asp?sid=103400&o_symb=hhl.a&symb=hhl.a&time=12&comp=&compidx=aaaaa%3A0&country=ca&draw.x=53&draw.y=13
We still maintain a long term perspective, and yet by ensuring we have adjusted the chart to show a "square" in regards to the scale on the right with a years period of time, we get a somewhat different view. I believe this is the view that would best represent judging the value of the accumulation period. We can clearly see now that near the end of '98, Hurricane started into a slower downtrending action ending in a nice break about a year latter. Not the 2 year downtrend Ted would ideally like to see, but definatly this chart represents a view much different than the first one which I believe Ted would catagorize as haveing "poor contrast".
In short, I believe that if we adjust our internet charts as I have described above (forming a box in regards to the scale on the right with a one year period), we will eliminate the confusing distortions that appear to occur in the long range on-line charting services.
Opinions and insight into this are welcomed.
Lester.