The open, high, low, close market price of the stock, commodity or currency over a period of time is illustrated in the candlestick form. The period covered is mostly user selectable.
5 minutes is probable for day traders but you might select 15 minutes in some circumstances. For longer term trading you can pick longer periods.
The difference between open and close points are designated by the candle body. If it?s a white or blue / green on charts with color, the lower body is the open and while you were considering it, the value marked up. Should it be black or red in charts with color, the top line indicates the opening rate and during that period, the price descended down.
In candles, vertical lines poking up from the top and down from the bottom are called wicks. The highest value ever obtained during the period is the top of the upper wick section. On the other hand, the lowest value is the bottom of the lower wick component.
This kind of analysis allows the trader to know at a glance if values dipped or shot up during the analysis time frame. Bearish tendencies or rise in price are evidenced by green or white candles while bullish temperament or fall in price would be pointed out by red or black candles.
Aside from this, the high and low relative to open and close prices are directly clear. Then you may have an entirely solid candle without a wick.
This is named as the Marubozu pattern. In this situation the market prices never went lower or higher than their opening and closing points.
If the candle is black or red, the opening rate was the high and the closing market price was the low. If it is white or green, the opening market price was the low and the closing market price was the high.
A lengthened body means a relatively steady movement either up or down. A lengthy wick situated on either bottom or top would imply a reversal.
In short, to ensure precise trend reading, candlestick must be read within the context of the preceding candlesticks. You then can continue to make more thorough candlestick patterns that will denote probable future trends.
