Reading Candlestick Charts

Candlestick charts are the most common way traders visualize price movement, packing four pieces of information into a single shape for each time period.

Anatomy Of A Candle

Each candle shows the open, high, low, and close for its period. The thick part, called the body, spans the open and close. The thin lines above and below, called wicks or shadows, mark the highest and lowest prices reached.

• A candle where the close is higher than the open is typically shaded one color (often green or white)
• A candle where the close is lower than the open is typically shaded another color (often red or black)
• Long wicks show that price moved far in one direction before being pushed back