Anatomy of a candle
Each candlestick shows four prices for its period — Open, High, Low, Close (OHLC):
- The body is open → close. Green = closed above open (buyers won the period); red = closed below (sellers won).
- The wicks (shadows) mark the high and low that got rejected.
A long wick means price went there and got pushed back — a footprint of rejection.
The candles worth knowing
- Doji — open ≈ close. Indecision; often a turning point after a strong move.
- Hammer / shooting star — small body, long wick: rejection of lower prices (hammer, bullish) or higher prices (shooting star, bearish).
- Engulfing — a big candle that fully swallows the previous one: a momentum shift.
The trap to avoid
A single candle is a word, not a sentence. Always read candles in context — at a key level, after a trend, with volume — never in isolation.