How to Read a Candle Chart

06

MAR,2018

How to Read a Candle Chart

Candlestick charts consist of a wide vertical line, and a narrow vertical line. Each candlestick includes the open, high, low, and close of the time frame, the direction (upward or downward) of the time frame, and the range of time of the timeframe.

During live trading, you can read the candlestick chart like this

  • Open

The open is the first price traded during the candlestick, and is indicated by either the top or bottom of the wide vertical line (the bottom for an upward candlestick, and the top for a downward candlestick).

  • High

The High is the highest price traded during the candlestick, and is indicated by the top of the thin vertical bar (the wick of the candle stick)

  • Low

The low is the lowest price traded during the candlestick, and is indicated by the bottom of the thin -vertical bar (the upside down wick of the candlestick).

  • Close

The close is the last price traded during the candlestick, and is indicated by either the top or bottom of the wide vertical line (the top for an upward candlestick, and the bottom for a downward candlestick).

5.) Direction

The direction of the candlestick is indicated by the color of the candlestick (specifically the wide vertical line). Usually, if the candlestick is green, the candlestick is an upward candlestick, and if the candlestick is red, the candlestick is a downward candlestick, but these colors can be customized. In the following chart, the upward candlesticks are colored white, and the downward candlesticks are colored black.