Candlestick Charts
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Introduction to Candlestick Charts
Candlestick charts are a type of financial chart used to describe price movements of securities, derivatives, and currencies. Each candlestick provides a visual representation of price movements for a specific period. This type of chart is highly favored in technical analysis for its ability to convey a large amount of information in a concise and easily interpretable format.
Structure of a Candlestick
A single candlestick consists of the following components:
1. Body:
Open Price: The price at which the asset started trading during the period.
Close Price: The price at which the asset ended trading during the period.
Color: Typically, a green (or white) body indicates a closing price higher than the opening price (bullish), and a red (or black) body indicates a closing price lower than the opening price (bearish).
2. Wicks (or Shadows):
Upper Wick (or Shadow): The highest price during the period.
Lower Wick (or Shadow): The lowest price during the period.
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