Candlestick charts are the most popularly used charts of all forex charts. Candlesticks offer all the data of bar (OHLC) charts, all in an easy to read and graphical dataset. After learning the basics of candlestick charts, you’ll be able to decipher data faster and make decisions quicker, a valuable skill in the world of forex trading.
What are Candlestick Charts
Candlesticks have been in use for centuries, first created as a way to easily see the changes in price of rice on Japan commodity exchanges. The image below will give you a better idea of what candlestick charts are:
Reading the Candlestick
Colors are used to differentiate between a candlestick that is positive (price going up) and a negative candlestick (price going down). For this tutorial, we have utilized the colors green for advancing candlesticks and red for declining candlesticks, a popular color combination on a plurality of forex trading platforms.
Candlestick Terminology
Candlesticks show all the data of a OHLC bar, but do so in a graphical way and utilize a different terminology. The middle colored portion of the candlestick is called the
