Summary
A Candlestick Chart displays price movement using candles that show the opening price, closing price, highest price, and lowest price for each selected period.
This chart type provides more detail than a simple line or area chart and is commonly used in technical analysis.
Why it matters
Candlestick charts help investors understand not only where a price ended, but also how it moved during the period. This can provide insight into buying pressure, selling pressure, volatility, and short-term sentiment.
They are useful for investors who want a more detailed view of market behaviour.
How to read it
Each candle shows a trading range and the relationship between the opening and closing price. A candle where the closing price is higher than the opening price generally indicates positive movement during that period. A candle where the closing price is lower generally indicates negative movement.
Candlestick patterns should be interpreted carefully and are most useful when combined with volume, trend direction, and broader market context.