Use a linear scale when you care about equal absolute changes, such as a $1 move, and want raw price differences to be easy to see. Use a logarithmic scale when proportional or percentage changes matter, especially on long-term charts where large moves can compress earlier price action.
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Logarithmic vs. Linear Chart: Detailed Comparison
investing10 min read
Use a linear scale when you care about equal absolute changes, such as a $1 move, and want raw price differences to be easy to see. Use a logarithmic scale when proportional or percentage changes matter, especially on long-term charts where…
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Many charting platforms let you switch between linear and logarithmic scales in chart settings. For one platform example, see TradingView’s guide to chart configuration: How to configure your Supercharts — TradingView.
Linear and logarithmic charts at a glance
A chart scale controls what equal vertical spacing means.
On a linear scale, each equal step on the vertical axis represents the same absolute change. If the spacing between $10 and $20 is one unit of chart height, the spacing between $90 and $100 is also one unit. The chart is showing equal dollar differences equally.
On a logarithmic scale, each equal step represents the same proportional change. A move from $10 to $20 is a 100% increase, while a move from $50 to $100 is also a 100% increase, so those moves can appear comparable in vertical distance. The chart is emphasizing percentage change rather than raw price change.
That difference can make the same price history look very different. A long-term chart with large cumulative gains may look steep and compressed on a linear scale, while a logarithmic scale may make earlier moves easier to compare with later ones.
Side-by-side comparison
| Aspect | Linear scale | Logarithmic scale |
|---|---|---|
| What equal vertical distance means | Equal absolute change, such as the same dollar amount | Equal proportional or percentage change |
| Visual effect on big moves | Large absolute moves dominate the vertical span | Large moves compress; proportional moves remain comparable |
| Best for | Short windows and small absolute-range comparisons | Long-term performance, exponential trends, and percent-based analysis |
| Trendline behavior | Reflects straight-line fits of absolute price | Can change slope and breakpoints for proportional trends |
| Common use | Intraday charts or situations where absolute price differences matter | Long-term charts, growth series, and percent-return focus |
This table is a quick reference, not a rule that covers every chart. The right scale depends on the question you are asking. If you are comparing dollar moves, linear may be clearer. If you are comparing growth rates, logarithmic may be more informative.
How to choose the right scale
Start with the analysis goal rather than the chart style. The scale should match the type of change you are trying to interpret.
Use this checklist before drawing trendlines, marking levels, or saving a chart:
- Analysis goal: Are you focused on percentage moves or absolute moves? If percentage moves are central, a logarithmic scale usually fits the question better. If raw price differences matter, a linear scale may be easier to read.
- Time horizon: Longer-term series with large cumulative changes often look clearer on a log scale. Short intraday snapshots often suit a linear scale.
- Signal type: Tools or rules based on proportional relationships, such as percent-based channels, pair naturally with logarithmic charts.
- Consistency: Keep the same scale across related charts when comparing them. Switching scale between charts can make similar moves look different.
- Documentation: Before recording a trade rule or sharing a chart, note the scale used. This helps avoid confusion later.
A simple decision table can help:
| Reader intent | Immediate action |
|---|---|
| Compare recent dollar moves across a single day | Use linear and label absolute changes |
| Evaluate long-term percent growth or drawdowns | Use logarithmic and focus on proportional change |
| Backtest a price-level strategy that uses fixed dollar stops | Use linear for rule design and testing |
| Compare assets with very different price levels | Prefer a proportional view, such as log, to avoid visual dominance by higher-priced assets |
The most important habit is consistency. If a trendline, support level, or exit rule was created on one scale, do not assume it will look the same after switching scales.
When a linear scale is useful
A linear scale is most useful when absolute price differences are the main point of analysis.
For example, if you are watching an intraday chart and care whether a stock moves by $0.50, a linear chart makes that kind of fixed-dollar move visually straightforward. The same vertical distance always represents the same dollar amount, regardless of where the price is on the chart.
Linear charts can also be easier for audiences who are less familiar with percentage-based analysis. A reader can usually understand that a move from $20 to $25 is a $5 move without converting it into a percentage. If the conversation is about raw gains, losses, price levels, or fixed-dollar targets, the linear view may communicate the idea more directly.
A linear scale is also relevant when a rule is built around fixed dollar stops or targets. If a strategy uses a fixed-dollar threshold, designing and testing that rule on a linear chart keeps the visual framing aligned with the rule.
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When a logarithmic scale is useful
A logarithmic scale is most useful when proportional or percentage changes matter.
This is common on long-term charts where price has moved many multiples from its starting point. On a linear chart, later large absolute moves can dominate the vertical space and make earlier changes look nearly flat. A log scale compresses large absolute values and helps show whether similar percentage changes occurred at different price levels.
Consider a conceptual comparison between two stocks over five years:
- Stock A moves from $5 to $50.
- Stock B moves from $50 to $250.
On a raw dollar basis, Stock B increased by more dollars. On a percentage basis, the comparison is different. A logarithmic view helps keep proportional growth visually comparable, so the chart is less dominated by the higher-priced asset.
Log scales can also help when reviewing percent-based drawdowns or percent-based rules. If the decision is framed as “10% from entry,” the chart view should make percentage relationships easier to see.
Practical examples
Intraday fixed-dollar target
Suppose you track a single stock intraday and plan around a $0.50 profit target. Because the target is stated in dollars, a linear chart is the simpler visual match. Each equal vertical distance represents the same dollar amount, making it easier to compare the target with recent price movement.
This does not mean a log chart is “wrong.” It means the linear scale better matches the specific question: “Has the price moved by this fixed dollar amount?”
Long-term performance comparison
Suppose you compare two stocks over five years. One started at $5 and rose to $50; the other moved from $50 to $250. On a linear chart, the second stock’s larger absolute dollar change may dominate the visual impression. On a logarithmic chart, percentage growth is easier to compare because equal proportional changes have more comparable spacing.
Here, the log view better matches the question: “How do these assets compare in percentage terms?”
Percent-based exit rule
If your rule is, “I will set an exit when the position loses 10% from entry,” the rule is percentage-based. A practical workflow would be:
- Define the decision clearly: for example, “Exit if the position loses 10% from entry.”
- Use a logarithmic scale while charting the setup, because the rule is proportional.
- Mark the entry and the 10% loss level.
- Record that the chart was viewed on a logarithmic scale.
- Make sure any backtest or written rule maps the visual decision to the same numerical price rule.
The chart scale is a visual setting. The numerical rule still depends on the actual prices used in the analysis, so documentation matters.
Common mistakes to avoid
The same data can look different when the scale changes. That is useful when you are exploring a chart, but it can create problems if you do not track what changed.
Avoid these common mistakes:
- Switching scales mid-analysis without noting it. A trendline drawn on a linear chart may appear broken after switching to log, and the reverse can also happen.
- Mixing chart scales across comparisons. Comparing one asset on a linear chart with another on a log chart can create misleading visual impressions.
- Applying percent-based interpretation to a linear chart without care. If the rule is based on percentage change, a log view may better match the logic.
- Sharing unlabeled charts. A reader may interpret the same image differently if they do not know whether the chart is linear or logarithmic.
- Assuming trendlines transfer cleanly. Scale changes can move where a line visually intersects price, which can affect how a breakout or support test appears.
When sharing a chart, add a short caption such as “Scale: logarithmic” or “Scale: linear.” If any trendlines or stop levels were created under a different scale, state that as well.
FAQ
Does switching between linear and logarithmic change technical indicators?
Switching scales changes the visual placement of prices and trendlines, which can alter how you interpret indicators tied to price levels. If an indicator uses percentage relationships, viewing the underlying price on a logarithmic scale may align better with that interpretation. If it uses absolute levels, check it on a linear scale. When possible, fix the scale before finalizing any rule.
Which scale do most charting platforms support?
Many charting platforms allow switching between linear and logarithmic scales in chart settings. For an example of chart-scale configuration, see TradingView’s guidance: How to configure your Supercharts — TradingView.
Will changing the scale affect backtest results?
The scale itself is a visual setting. A numerical backtest still uses the same underlying prices. However, if visual decisions such as trendline breaks or chart patterns inform the rule, the chosen scale can influence the design. Document the scale used so the rule and the test are aligned.
How should I label charts I share?
Use a one-line note near the chart title, such as “Scale: logarithmic” or “Scale: linear.” Also state whether any trendlines or stop levels were created under a different scale.
Conclusion
Linear and logarithmic charts answer different visual questions. Linear charts make equal dollar changes look equal, which is useful for short time frames and fixed-dollar analysis. Logarithmic charts make equal percentage changes look comparable, which is often clearer for long-term performance and proportional growth.
Before analyzing or sharing a chart, ask whether the decision depends on absolute or percentage change. Then choose the scale that matches that question, label it clearly, and keep it consistent. For more chart-reading basics and related learning resources, visit Finelo.
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