Candlestick Patterns In Technical Analysis

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Candlestick charts are an effective way of visualizing price movements. There are two basic candlesticks:

  • Bullish Candle: When the close is higher than the open (usually green or white)
  • Bearish Candle: When the close is lower than the open (usually red or black)

bullish and bearish candlestick chart patterns

There are three main parts to a candlestick:

Upper Shadow: The vertical line between the high of the day and the close (bullish candle) or open (bearish candle)

Real Body: The difference between the open and close; colored portion of the candlestick

Lower Shadow: The vertical line between the low of the day and the open (bullish candle) or close (bearish candle)

Candlestick Patterns

Candlestick patterns can be made up of one candle or multiple candlesticks, and can form reversal or continuation patterns. Commodity.com has many detailed explanations of these candlestick patterns; the links are given below:

If you prefer a video explanation of candlesticks, then please see Candlestick Charts Explained.

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