Log scale (logarithmic scale) is a chart setting where equal vertical distances represent equal percentage changes, rather than equal dollar changes. A move from 10 to 20 occupies the same height as a move from 100 to 200 — both are +100%.
How it works
On linear charts, equal dollar distances take equal space, so early history on a multi-fold rally gets compressed into a flat line and recent prices claim the whole chart.
On log charts, each doubling looks the same size. A straight line on log scale represents a constant percentage pace — usually the more meaningful description of long-term compounding.
Why it matters
The larger the move relative to the price level, the more the two scales diverge — and with them, the meaning of any trendline drawn across the range.
Trendlines drawn on log scale describe a constant percentage rhythm; the same anchors on linear scale describe a constant dollar rhythm. These are different claims with different projections.
A simple market example
A stock travels 50 → 100 → 200. On linear scale, the second leg towers over the first — it earned more dollars. On log scale, both legs are equally tall — both earned 100%, the return an owner actually received.
Common mistakes
Reading “steep recent move” from a linear long-term chart. On a larger base, the same percentage looks much taller — the steepness is arithmetic, not momentum.
Mixing scales: a trendline’s slope means different things on each scale, and comparing angles across settings is meaningless.
Frequently asked questions
Do I need log scale for short-term charts?
Rarely. Within days, price stays within a small percentage of its range and the scales nearly coincide. Divergence grows with the size of the move relative to price.
Which scale do charting platforms use by default?
Most default to linear. Switching to log is usually one click in settings — worth doing on any chart spanning years or multiples of price.
Is log scale only for assets that rise a lot?
It is most useful wherever price has multiplied — multi-year rallies, commodity cycles, or any chart whose range has stretched several times from its start.
Educational content only. Definitions describe common market usage and may vary by jurisdiction, instrument, or institution.