What is a Candlestick
A candlestick is one of the most basic financial charts to describe price movements, based on 4 important components. It shows the open, low, high and closing price of an asset during a specific time period. On most Cryptocurrency Exchanges the time periods reach from 1 minute to 1 day or even a week. An investor may decide after interpreting candlestick patterns and other circumstances whether he wants to invest or not. The color of the candlestick shows the price trend. While green candles indicate buy pressure, red candles show sell pressure.
Simple Patterns There are different candlestick patterns, a trader should be aware of. We will start with a few simple ones here and speak about more complex patterns in an extra article.
Complex patterns like the following will be explained here.
- Three Soldiers
- Bullish Engulfing Pattern
- Morning Star
Candlesticks have been developed in the 18th century by Japanese people tracking the price of rice. They were Later introduced to the West. Some people will realize the visual similarity to box plots, but box plots show different information