Candlestick charts are commonly used in trading to represent the price movement of an asset over a specific time period. Each candlestick on the chart provides information about the opening, closing, highest, and lowest prices of that period.
A bullish candlestick, often represented as a green or white candle, indicates that the closing price is higher than the opening price, suggesting positive price movement. Conversely, a bearish candlestick, often represented as a red or black candle, indicates that the closing price is lower than the opening price, suggesting negative price movement.
The "body" of the candlestick represents the price range between the opening and closing prices, while the "wicks" or "shadows" represent the highest and lowest prices reached during that period.
Candlestick patterns can provide insights into market sentiment and potential price reversals. Traders often analyze these patterns, such as doji, hammer, engulfing, and many others, to make informed trading decisions.
