How to Read Trading Candles:

1. Components of one candle:

Body:

It represents the difference between the opening price and the closing price during a specified period of time.

If the price rose during the period, the body is green (or white).

If the price falls, the body is red (or black).

Wicks or Shadows:

Indicates the highest and lowest price reached during the period.

Upper wick: High.

Bottom wick: Low price.

2. Types of candles:

Bullish candle: The closing price is higher than the opening price (usually green).

Bearish candle: The closing price is lower than the opening price (often red).

Common Candlestick Patterns:

1. Individual patterns:

Hammer candle:

It appears after a downtrend.

Small body with long lower wick (indicating a bullish reversal).

Hanging Man Candle:

Appears after an uptrend.

Small body with long lower wick (signal of bearish reversal).

Doji candle:

The opening and closing price are almost equal.

Indicates hesitation in the market.

2. Binary and ternary patterns:

Bullish Engulfing:

A bullish candle completely covers a previous bearish candle.

Indicates a bullish reversal.

Bearish Engulfing:

A bearish candle that completely covers a previous bullish candle.

Indicates a bearish reversal.

Stars pattern:

Like "morning star" for rising or "evening star" for falling.

How to use Japanese candlesticks in trading:

1. Determine entry and exit points:

Use candlestick patterns to identify potential areas of trend reversal or trend continuation.

2. Momentum analysis:

Body length and wicks reflect market strength.

Long bodies = strong momentum.

Long wicks = hesitation between buyers and sellers.

3. Integrate it with other tools:

Combine candlesticks with support and resistance levels, trend lines, or indicators like RSI and MACD to improve accuracy.

Tips for Success Using Japanese Candlesticks:

Learn the most common and effective patterns.

Don't rely solely on candlesticks; use them in conjunction with other analysis tools.

Test your strategies on a demo account.

Risk management is essential in any trading strategy.

Do you need an explanation of a particular pattern or strategy using candlesticks?