Japanese candlesticks are basically an ancient tradition of the Chinese for keeping tabs on the rice markets. Considered by many (safe to say at this point.) to be the best way to view an asses price action. Japanese candlestick have become popular in just about every liquid market.
Japanese candlestick charts display market sentiment like no other form of charting can. With candlestick charts you have basically 2 moving parts. (If you will.) The real body, can be full or hallow, and the wicks or shadows can be long or short, or gone - either way, together you get a nice picture of price action today, or over a period of time.
A high is marked by the top of the upper shadow or a wick. It indicates the highest point of the day in trading. The low is marked by the bottom of the lower shadow. If a security closes higher than it opened, then a hollow body is drawn. The top line of the body itself would indicate the close and the bottom line of the body would indicate the open. If a security closes lower than the opening price, then a filled body is drawn with the top line indicating the opening and the lower one indicating the close. (See below.) [I:0:J]
Candlestick patterns are not only more easy to read, they are also more intuitive once you get the hang of reading them. You see there are patterns with candlesticks you will soon learn to easily recognize, combine this with the intuitiveness and you have yourself a method for assessing price far superior to any other.
There are different sizes of bodies as well. A long hollow body indicates there was a large advance in pricing between the open and close. A long filled body indicates the closing price was much lower than the opening. In return and in keeping with the same analogy, a short hollow body would indicate a small rise in pricing between open and close and a short filled body would indicate a small drop in pricing between open and close.
When you have a body with no shadows its called a Marubozu. I can be black or white in which case its a "black Marubozu or a white Marobozu. In each case the open and close are equal to the high and the low. With the black the open is equal to the high and the close is equal to the low. The white would be the open is equal to the low and the close is equal to the high.
A spinning top is a candlestick with a short body and a long or short wick/shadow. The short body tells us that price opened and closed rather close to one another, while a long shadow/wick tells us that during the session price made its way in that direction but failed to hold its ground. This failure to "hold ground" could be a clue for price direction in the next session. [I:1:J] - 16459
Japanese candlestick charts display market sentiment like no other form of charting can. With candlestick charts you have basically 2 moving parts. (If you will.) The real body, can be full or hallow, and the wicks or shadows can be long or short, or gone - either way, together you get a nice picture of price action today, or over a period of time.
A high is marked by the top of the upper shadow or a wick. It indicates the highest point of the day in trading. The low is marked by the bottom of the lower shadow. If a security closes higher than it opened, then a hollow body is drawn. The top line of the body itself would indicate the close and the bottom line of the body would indicate the open. If a security closes lower than the opening price, then a filled body is drawn with the top line indicating the opening and the lower one indicating the close. (See below.) [I:0:J]
Candlestick patterns are not only more easy to read, they are also more intuitive once you get the hang of reading them. You see there are patterns with candlesticks you will soon learn to easily recognize, combine this with the intuitiveness and you have yourself a method for assessing price far superior to any other.
There are different sizes of bodies as well. A long hollow body indicates there was a large advance in pricing between the open and close. A long filled body indicates the closing price was much lower than the opening. In return and in keeping with the same analogy, a short hollow body would indicate a small rise in pricing between open and close and a short filled body would indicate a small drop in pricing between open and close.
When you have a body with no shadows its called a Marubozu. I can be black or white in which case its a "black Marubozu or a white Marobozu. In each case the open and close are equal to the high and the low. With the black the open is equal to the high and the close is equal to the low. The white would be the open is equal to the low and the close is equal to the high.
A spinning top is a candlestick with a short body and a long or short wick/shadow. The short body tells us that price opened and closed rather close to one another, while a long shadow/wick tells us that during the session price made its way in that direction but failed to hold its ground. This failure to "hold ground" could be a clue for price direction in the next session. [I:1:J] - 16459
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Japanese candlesticks are the choice for professional traders and anyone who wants to have the best perspective on price action, and current market conditions. If you aren't using candlestick patterns to trade, you are absolutely missing out. To start using Japanese candlesticks now visit our website and download our free course material. http://www.candlestickgenius.com
