What is a candlestick chart?

Candlestick charts are a technical tool that packs data for multiple time frames into single price bars. This makes them more useful than traditional open, high, low, and close (OHLC) bars or simple lines that connect the dots of closing prices. Candlesticks build patterns that may predict price direction once completed.

What are the 4 components of a candlestick chart?

A candlestick chart consists of four key components: open price, close price, high price, and low price. Each candlestick represents a specific time period and displays these price points through its body and wicks, providing traders with a visual representation of price movements. How can traders interpret bullish and bearish candlestick patterns?

What are candlestick patterns?

Candlestick patterns are technical trading tools that have been used for centuries to predict price direction. There are dozens of different candlestick patterns with intuitive, descriptive names; most also have a corollary pattern between the upside and downside.