Candlesticks have a formation that displays the open, high, low and closing price of a currency, stock or commodity over a duration. You can typically choose the time frame that you want to show.

Day traders generally choose 5 minutes though 15 minutes can be your option for certain cases. Longer periods may be chosen for longer term trades.

The difference between open and close points are marked by the candle body. If it?s a white or blue / green on charts with color, the lower body is the open and while you were considering it, the value marked up. Should it be black or red in charts with color, the top extent indicates the opening value and during that period, the price moved down.

In candles, vertical lines pointing up from the top and down from the bottom are called wicks. The highest price ever obtained during the period is the top of the upper wick section. On the other hand, the lowest value is the bottom of the lower wick part.

The boon of this kind of analysis is that the trader can straight off see whether prices rose or fell over the period. A white or green candle manifests a rising price or bearish tendency and a black or red candle signifies a dropping price or bullish tendency.

The connection of open and close values to high and low values can be noted spontaneously. Then there is a solid candle without a wick.

The name for this is Marubozu pattern. This means that the opening and closing prices were never reached in either direction by the low and high prices.

The opening was the high price & the closing was the reduced price if the candle was red or black. The low price is the open and the close is the high price when the candle is green or white.

A relatively uniform upward or downward trend is defined by a long body. A reversal is designated by a long wick on the top or on the bottom.

For accurate trend identification a candlestick needs to be examined in conjunction with the others that preceded it. Then you can devise more complex candlestick patterns signifying the anticipated trends to come.

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