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Candlestick Charts

Traditional charts compared with candlestick charts

The majority of traders consider the Japanese candlestick charts are an easier system to interpret and more visually appealing than other types of charting systems. Each type of candlestick provides an easy to understand picture about the price movement during the period in question. The interpretation of the candlestick will depend on the open and close price during that specific period of time. Candlestick analysis is part of most trading systems.

– Hollow or White Candlesticks:
In those candlesticks, the closing price is higher than the opening price, which indicates buying pressure.

– Filled or Black Candlesticks:
In those candlesticks, the closing price is lower than the opening price, which indicates selling pressure.

Candlestick charts | FXLORDS

Long versus Short Bodies

The long and white candlesticks show strong buying pressure, similarly the long black candlesticks show strong selling pressure. Conversely, short candlesticks represent less price action or movement, or in other words, more price consolidation.

Marubozu Candlesticks

Marubozu | FXLORDS

Marubozu Candlesticks are those white or black candlesticks, which do not have any shadows and only contain a body.

– White candlesticks:
The opening price is the lowest price and the closing price is the highest price during that period.

– Black candlesticks:
The opening price is the highest price and the closing price is the lowest price during that period.

Long versus Short shadows

The upper and lower shadows of candlesticks can provide valuable information about the trading session. The upper shadow represent the point where the highest price has been reached during that period, and the lower shadow represent the point where the lowest price has been reached during that period or trading session. Candlesticks with short shadows indicate that most prices offered during that session were limited to the open and close prices, whereas long shadows indicates that prices offered exceeded the opening and close price of that period or trading session.

FXLORDS | Hammer Hanging Man

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About Razi Hammoudeh

Razi’s professional experience was gained over the course of more than a decade working with leading Forex market makers in the Middle East, Asia and Europe where he learned about trading, financial instruments and global markets. Being exposed to the wide range of skills he acquired along the years, he continued to develop his trading strategies and further improving his track record in Forex trading. He used innovative business development strategies to find FXLORDS, helping it to rapidly become a major provider of education and trading tools to the successful trader. He is an enthusiastic individual, motivated by challenge and renowned for pushing the limits, always looking to gain some more experience and help as much as possible along the way.

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