Candlestick patterns: a guide to candlestick charts
Published on: 08/12/2021 | Modified on: 31/01/2023
This article explains the basics of how to to read candlestick charts and interpret price action across thousands of financial instruments, such as forex, stocks, indices, commodities, treasuries, and ETFs. See how you can apply candlestick patterns to your trading strategy.
- Candlesticks are one of the most popular chart types as they clearly display price action
- The body of the candlestick shows the difference between the trading day’s opening and closing prices
- A bullish candlestick pattern suggest that asset prices are rising, whereas a bearish pattern suggests that prices are falling
- Popular patterns include doji, engulfing, hammer, three black crows and evening star
- Many types of technical indicators can be applied to candlestick charts, including moving averages and support and resistance lines