Hello everyone!
Who are the stronger sellers or buyers right now?
The one who finds out the answer will be able to earn a lot.
Over time, one side weakens, the other gains strength.
It is not easy to catch this moment, but there are several methods for determining a possible change in the dominant force in the market.
Japanese candles, namely their bodies, can help us with this.
The body shows how strong or weak one or the other side is.
The body shows whether buyers are losing strength and whether sellers are gaining strength.
Are buyers or sellers strong?
By looking at a particular candle and its body, we can understand what was happening in the market in a given period of time.
If we see a full-bodied green candle that has no shadows, then we can say with confidence that buyers are winning.
The point is that buyers were able to push the price up after the opening and until the closing, which sellers could not resist.
On the other hand, if we see a full-bodied candle of red color, we can say that the sellers won.
Without much resistance, sellers pushed the price down from the beginning to the end and were able to close at the very bottom of the candle.
Full–bodied candles speak of enormous strength, they can appear confirming the trend or starting it, in any case - this is a strong sign.
Still strong, but…
If you see a green candle with a long body and small, short shadows on the chart, then you can say that buyers dominate the market.
But what are these shadows?
These shadows remind us that sellers, although losing heavily, still did not give up.
It's the same with candles that have long red bodies and short shadows.
Sellers are strong, but buyers are still here, as the shadows remind us.
Seeing such shadows, you should not be afraid and open positions in the opposite direction, no.
It's just a reminder.
The fight is getting harder.
A candle with a small green body, which is located at the top, shows us that buyers have taken over the market, but the victory turned out to be very difficult.
The long shadow under the body indicates to us the rage of the sellers, who dragged the price down for a very long time, but still lost in the end.
Maybe it was the last impulse of buyers?
This fight was almost on an equal footing, but the victory remained with the buyers.
In such situations, you can ask the question - Will there be a U-turn?
Red body on top, with a long shadow.
The sellers won here, but the buyers fought with dignity.
Depending on the context, this figure can serve as a signal of an imminent reversal.
After all, sellers were able to push the price very deep, but buyers did not give them a foothold there.
The last push?
The short body is green, and above it is a long shadow.
The victory remained with the buyers, but was it easy? No.
Perhaps it was the last rush of buyers, after which there is no strength to fight anymore.
Maybe the price will not turn right away, because the buyers have won and they still have strength, but their strength is clearly running out.
The same is the case with candles, whose bodies are red, indicating the victory of sellers, but long shadows over the body indicate the strength of buyers.
The forces of buyers were able to push the price, but not to fix it.
This signal is even more bearish, because the price closed below the opening.
Conclusion
Each candle is important, but the context is more important.
Candles help to get the first signals if you are able to understand them correctly.
The shadows of candles are the story of a struggle that usually escapes the eye, but at the same time carries a lot of information.
Be careful and don't stop learning.
Traders, if you liked this idea or if you have your own opinion about it, write in the comments. I will be glad 👩💻