Candlestick Pattern :-
Candlestick charts are widely used in financial analysis to visualize the price movement of an asset over a specific time period. Each candlestick represents one trading session and provides information on the opening, closing, high and low prices for that period.
Origin of candlestick :
Candlestick charts have their roots in 17th-century Japan, where they were used to track rice price movements in the Osaka market. This method of charting price movements became known as the “Japanese candlestick chart technique”. Munehisa Homma, a Japanese rice trader from Sakata, is often credited with developing the early principles of candlestick charting. Homa’s techniques formed the foundation of candlestick charting.
Basic of candlestick :
A candlestick consists of four main components: the opening price, the closing price, the high price, and the low price. These values are represented using the shape and color of the candlestick.
The body of the candlestick represents the price range between the opening and closing prices. If the closing price is higher than the opening price, the body is colored green or white to indicate bullish (upward) movement. Conversely, if the opening price is higher than the closing price, the body is shown in red or black. Which indicates bearish (downward) momentum. Thin lines extending up and down the body are called “wicks” or “shadows”. The upper wick represents the highest price reached during the session, while the lower wick represents the lowest price.
You can understand each candlestick in more detail by clicking on the points given below.
- Bullish Candlestick Patterns :-
- Bearish Candlestick Pattern :-
- Continuation Candlestick Patterns :-
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