CANDLESTICK

26/6/2018

CANDLESTICK

The candlestick chart pattern, also known as the Japanese chart pattern, is a trading chart pattern used for technical analysis. The chart is similar to a bar chart, with a rectangle as the background instead of a horizontal line. Candlesticks consist of two sections: one section forms the body; the other forms the tail and wicks.

This type of candlestick chart pattern marks a short-term reversal in the price of an asset, while offering powerful insight into trader sentiment.

A candlestick chart pattern (or, more simply, a candle) is a type of financial chart that displays the opening and closing prices for a security over a time period. Candles are plotted predominantly on the upper body or lower body of a single bar. These are not the same thing as shooting stars and dojis.

A candlestick chart is a popular chart for technical analysis. It has a long history, and the data displayed in it can be analysed from a wide range of perspectives. The main use of this chart is identifying trends, but some traders also analyse candlesticks for reversals and reversals themselves (once identified). A reversal can be either bullish or bearish, on the basis that if a reversal occurs at the top of an uptrend then there is high probability it will retest lower prices/fail and if a reversal occurs at the bottom of a downtrend then there is high probability that price will test higher prices before failing.