Some chartists use only arithmetic scale charts. Some only log scale charts. For a given market, I think it is best to use whichever scale presents the cleanest trend channels. Why? Channels are my favoured charting tool. Why? It is the nature of markets to grow and decay within channels much of the time, and besides, channels present many trading edges with attractive risk:reward setups. Others will have different criteria for selecting the scale of their charts. Each to their own. In charting and even moreso in trading, the only measure of what is right and wrong, is what whatever works for the individual. There are as many different ways of profiting from the markets as there are profitable traders.
With the above in mind, I believe that log scale is best for viewing the ASX 200 monthly chart, as it presents a neat up trend channel, shown in the first chart below. The Elliott Wave count combined with the larger corrective down trend channel on this log scale chart projects a target of around 2700 before the end of 2016.
Next I've shown the arithmetic scale chart monthly chart. It presents no obvious up trend channel, but many chartists and traders swear by it, so here it is. The blue up trend line is giving hope to the bulls, but they will be reminded in coming weeks or months that in a bear market there is no such thing as support. The Elliott Wave count combined with the larger down trend channel in this case projects a target of around 2250 before the end of 2016, though I had to scroll the chart off to the bottom right to pinpoint that level. Arithmetic or log scale for this market? Take your pick.
Weekly chart next, backs the bearish stance for coming months. Why? Simply and crucially, the trend is down. The market has plenty of wriggle room to the upside before it even hints of a trend change from down to up.