What are the candlesticks?
Candlesticks are a way to express visually the size of the price movement.
There are different colors used for the candlesticks, but in pairs of 2: one color for an uptrend (usually marked in green) and one for a downtrend (usually marked in red).
Candlesticks are placed in graphics and by their movements create patterns. Starting from those patterns traders decide on a possible future pattern: where will/can the price go from now, based on the previous movements of the price.
On any chart, you can use more ways to see the price of an asset:
1. Candles - full candles (usually red or green)
2. Hollow candles - a full candle for a candle that show a downtrend (usually red) and an empty one for an uptrend (usually green and used only on the edges)
3. Bar
4. Line
5. Mountain
The main advantage of the candles is that they are more visual. In other words, you can see faster what is going on in your chart.
Why usually red or green?
The candles are said to show the emotions, so:
Red when something is not good
Green when something is loved/liked
Why do most people use the candles system?
The main advantage is that in any time frame you can see these prices:
1. Open price
2. Close price
3. High price
4. Low price
What are time frames?
There are many time frames: 1, 5, 10, 30 minutes / 1, 4 hours / 1 day / 1 week.
For any time frame chosen by the trader the pattern of the candles changes.
Depending on what you want to do (invest short, medium or long term) you look at different patterns/timeframes that the candles made.
The body of the candle represents the price range between a determined timeframe.
If the candle is red - the price is lower than 5 minutes ago (where 5 minutes is the selected timeframe)
If the candle is green - the price is higher than 5 minutes ago (where 5 minutes is the selected timeframe)
Sometimes the candle looks like a cross (the body for the candle is missing). That means that the opening and close prices are the same.
Any candle has 2 wicks or “shadows”:
1. Up - representing the maximum price
2. Down - representing the minimum price
There are bigger and smaller candles. Why?
The bigger the candle the bigger the price movement.
The smaller the candle the smaller the price movement.
If the up wicks are smaller it shows that the price closed near the maximum price of that timeframe. The same is valid for a down wick.
If the down wicks are bigger it shows that the price closed far from the minimum price of that time frame. The same is valid for an upper wick.
There are different colors used for the candlesticks, but in pairs of 2: one color for an uptrend (usually marked in green) and one for a downtrend (usually marked in red).
Candlesticks are placed in graphics and by their movements create patterns. Starting from those patterns traders decide on a possible future pattern: where will/can the price go from now, based on the previous movements of the price.
On any chart, you can use more ways to see the price of an asset:
1. Candles - full candles (usually red or green)
2. Hollow candles - a full candle for a candle that show a downtrend (usually red) and an empty one for an uptrend (usually green and used only on the edges)
3. Bar
4. Line
5. Mountain
The main advantage of the candles is that they are more visual. In other words, you can see faster what is going on in your chart.
Why usually red or green?
The candles are said to show the emotions, so:
Red when something is not good
Green when something is loved/liked
Why do most people use the candles system?
The main advantage is that in any time frame you can see these prices:
1. Open price
2. Close price
3. High price
4. Low price
What are time frames?
There are many time frames: 1, 5, 10, 30 minutes / 1, 4 hours / 1 day / 1 week.
For any time frame chosen by the trader the pattern of the candles changes.
Depending on what you want to do (invest short, medium or long term) you look at different patterns/timeframes that the candles made.
The body of the candle represents the price range between a determined timeframe.
If the candle is red - the price is lower than 5 minutes ago (where 5 minutes is the selected timeframe)
If the candle is green - the price is higher than 5 minutes ago (where 5 minutes is the selected timeframe)
Sometimes the candle looks like a cross (the body for the candle is missing). That means that the opening and close prices are the same.
Any candle has 2 wicks or “shadows”:
1. Up - representing the maximum price
2. Down - representing the minimum price
There are bigger and smaller candles. Why?
The bigger the candle the bigger the price movement.
The smaller the candle the smaller the price movement.
If the up wicks are smaller it shows that the price closed near the maximum price of that timeframe. The same is valid for a down wick.
If the down wicks are bigger it shows that the price closed far from the minimum price of that time frame. The same is valid for an upper wick.
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Join our community via discord.gg/FGUTfkmYbW
All content from AngelAlgo is for informational and educational purposes only. Please note that past performance does not guarantee future results.
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